SBG: Our top 8 highlights of 2018

As 2018 draws towards a close and we reflect on the past year, we wanted to share with you our top 8 highlights from across our Property, Private Equity, Credit and Emerging Companies Funds offering in 2018.

Property – SBG Hotel Group, Australia

1. Acquiring the Watermark Hotel, Gold Coast and converting to new IHG global brand voco in just 5 months

SBG Hotel Group acquired the Watermark Hotel on the Gold Coast in March 2018 and from settlement in June, worked closely with partner IHG to refurbish the hotel and launch it as the first Vocohotelin the world in just 5 short months. The AUD$7.5M refurbishment included refurbishing all 389 rooms and all outdoor spaces, making it a sought after new hotel experience for the flourishing Gold Coast tourism and business leisure market, further strengthening SBG’s partnership with IHG.

 

2. Successfully completing Stage 1 AUD$25M renovation of Crowne Plaza Melbourne

As 1 of the 5 initial SBG Hotel Group hotels acquired in 2015, the Crowne Plaza Melbourne’s Stage 1 refurbishment of all 402 guest rooms, completed in November 2018, was an important milestone for the Hotel Group.

The property is absolute riverfront and ideally located close to Melbourne’s CBD, Convention Centre and Southbank entertainment and leisure precinct, making it highly appealing for business and leisure travellers. Stage 2 Refurbishment of the hotel’s restaurants, bars and reception areas have just commenced and will be complete in 2019.

 

3. Development of 2 new Hotels in Melbourne and Canberra in 2019/2020

With much of the planning work carried out throughout 2018, SBG Hotel Group has committed to the development of 2 new hotels in Australia in 2019/2020– being a Holiday Inn Express, Canberra, to compliment our existing Crowne Plaza Hotel in Canberra, and a new hotel in Flinders Lane, Melbourne.

These new developments will take the SBG Hotel Group portfolio to 8 hotels across the 4 major markets of Melbourne, Sydney, Gold Coast and Canberra in 2019/2020.

 

 

SBG Hotel Group planning to launch AUD 200M Capital Raise in 2019

SBG’s 2 new hotel developments in Canberra and Melbourne, together with our current capital expenditure plans, will see the Group launch a capital raise of up to AUD200 Million in 2019 to be predominantly funded by local and international institutional investors including major Australian Superannuation Funds. Our existing Atlas and SBG investors will be able to participant to invest in the Hotel Group. Please contact us for further information.

Property – SBG Hotels USA

4. Establishing 2 new USA Hotel Funds in partnership with IHG

This year, we launched 2 new USA Hotel Funds focused on the Upscale and Luxury segments of the USA hotels market. Established to gain exposure to $USD assets and meet strong client demand, on objective is to develop a USD 1bn hotel portfolio over 3-5 years and further strengthen the Group’s partnership with IHG into the USA. Opportunities to invest into these Funds are available, please contact us for more information.

 

 

Launching the SBG Upscale Hotel Fund, USA with our first hotel investment in Washington DC

The new SBG Upscale Hotel Fund builds on the expertise and success of the SBG Hotel Group in Australia as it invests in existing hotels and refurbishes and rebrands them to Crowne Plaza Hotels. This is supporting IHG’s vision for Crowne Plaza to become the leading hotel brand in the US for business travellers through its US$200 Million Accelerate Program. The Fund’s initial USD$22M investment was made into the Washington DC-Greenbelt Marriott hotel in July 2018, which is currently being refurbished and converted to Crowne Plaza in early 2019.

 

 

Launching the Luxury Hotel Fund, USA with a primary hotel investment in Charlotte, North Carolina

The SBG Luxury Hotel Fund partners with IHG and Valor Hospitality to develop luxury Kimpton and InterContinental hotels in several locations in the USA. The Fund’s seed investment is the development of a new InterContinental Hotel in Charlotte, North Carolina, a 5 star, 283 room full-service hotel located above the historic Carolina Theatre.

 

Property – Residential

5. Everlea 116 Townhouse Residential Development in Keysborough, Melbourne

In May, we released Everlea, a residential development of 116 townhouses in Keysborough Melbourne.

In a year that has been challenging for many residential areas of Melbourne, Keysborough continues to perform strongly and is in the top 3 suburbs for price growth. Perfectly located 30km from the city in Melbourne’s south east and 8km from Port Phillip Bay, Keysborough has performed very well over recent years, and with our Everlea townhouse prices increasing by 2-4% since May 2018, this demonstrates that good properties are still performing well in the Melbourne market.

Everlea is situated next door to Haileybury College, one of Melbourne’stop private schools, and early 2019 will see the release of some of the best townhouses in the development. A small number have been reserved exclusively for current SBG and Atlas clients, please contact for more information.

 

 

Private Equity

6. AUD$16M Private Equity Investment into Inference Technologies Group’s global expansion

In July, the SBG Private Equity Fund, together with the Atlas Capital Group’s Emerging Companies Fund, partnered with leading US Venture Capital Fund, PeakSpan Capital Growth Partners, to invest AUD$16M into Inference Technologies Group, a leading provider of solutions designed to help organisations automate and facilitate interactions with their customers

 

Inference Technologies will use the capital to further expand into regional markets, strengthen their support of international partners in the US, UK, Europe and Asia, and continue product expansion and undertake a corporate restructure to become a US company.

7. SBG Capital’s Emerging Companies Fund exceeds the index by 10.3%

SBG Capital was appointed the manager for the Atlas Capital Emerging Companies Fund in December 2017. Since then, the gross performance of the Fund has exceeded the S&P/ASX Small Ordinaries Accum. Index by 10.3%, to the end of November 2018, improving the relative performance of the Fund.

 

 

Credit

8. (a) Launching bond products with US dollar investment opportunities

In a year which has seen the US Dollar perform strongly against most currencies, SBG launched a suite of (USA) Bond Funds. Based on client demand, the Fund offers clients an investment option with a fixed income return, denominated in $US dollars and secured against real property assets, including premium IHG branded hotels.

 

 

(b) Launching bond products with AUD dollar investment opportunities

SBG Property Opportunity Fund Ltd increased its existing debt facility to AUD $80m through the issue of 3 year and 5 year bonds. This facility, offered to investors, is Senior debt secured by 1st ranking charge over the assets of the company.

 

 

Special Bonus Point: Having a great team who work hard and are committed to creating value

The success of our business and the value we deliver to our clients is the result of the hard work of many on the SBG and Atlas teams.

From Investment Managers to Client Relations, to the Finance and Admin teams, our staff share a strong commitment to creating value for our investors. Our culture is about thinking differently, encouraging team members to use their experience to analyse opportunities from multiple perspectives and to create new ways of working and partnering with brands and people we trust. It is a culture we are proud of and what we believe underpins our success.

 

 

We would like to take this opportunity to thank our staff and investor clients for what we have collectively achieved in 2018 and we wish you a safe, happy and joyful season, as we look forward to 2019.

 

Robert Salter

CEO, SBG