Industry Leaders Forum
Salter Brothers were pleased to be invited to be part of the HM Magazine 2019 Industry Leaders Forum, published in February/March 2019.
Business outlook for 2019
As an international specialist fund manager with a focus across a range of asset classes and geographies, innovation continues to be a key theme and driving factor across Salter Brothers’ operations for 2019. While 2018 was a year of expansion and acquisition for Salter Brothers, 2019 will be a year of consolidation and active asset management within our Hotel Group. CapEx will be up on 2018, but our spending this year will be strategically focused on our existing portfolio with investments planned to improve existing products, introduce new offerings and to progress our plans for bringing brand new hotel developments to market.
Value-add initiatives: Crowne Plaza Melbourne & Coogee
In support of our market opportunities in 2019, we have a number of value-add initiatives in play to strategically position our assets to perform well against competitors. This includes completing the refurbishment of Crowne Plaza Melbourne where we will be increasing our room count by another 35 rooms and increasing our meeting space facilities by 100%, taking the asset to 1200sqm, and opening up new customer and business segment opportunities. We also plan to undertake a comprehensive refurbishment of Crowne Plaza Coogee Beach over the winter where we will add an additional 10 rooms and 150 sqm of meeting space, and relaunch with two new restaurant & bar facilities.
New Developments: Melbourne & Canberra
With regards to new build hotels, we will be progressing plans for our two developments in Canberra and Melbourne. Our property at 475 Flinders Lane, Melbourne was acquired in 2017 and our vision here is for a new 350+ room upscale hotel, scheduled to be completed in 2020. In Canberra, a new Holiday Inn Express will be added to the current Crowne Plaza site, complementing the existing hotel and diversifying the offering.
Hotel Investment, Operations & Development
We consider hotel development across Australia to be at its peak right now which means there is a massive injection of talented new staff required. We have now fully recruited and established an experienced, industry specialist hotels team at Salter Brothers with recognized capabilities in hotel investment, operations & development. We take an active investment management approach and will be setting high expectations from our management companies and key partners such as InterContinental Hotel Group (IHG), to invest in attracting, developing and retaining talent to fill our asset requirements, and in support we will invest in ensuring our assets have programs and facilities to promote a strong staff culture, opportunities to learn and opportunities for career advancement.
Market outlooks for 2019 and industry impacts
Whilst we consider we may face some head winds in our various markets at different times in 2019 with either new supply entries, a short-term election-related travel slow down or possible refurbishment timeline changes, our projections for the markets we operate in are positive, with strong underlying fundamentals remaining.
With many commentators forecasting for unemployment to remain low and potentially further decrease, we consider this to be a very positive factor in driving continued growth in our markets providing our hotels in 2019 an opportunity to outperform 2018 trading.
A focus on Hotel Restaurants & Bars
Further to the refurbishments across Crowne Plaza Melbourne and Crowne Plaza Coogee Beach, we will be innovating our restaurant and bar model across our portfolio together with hotel management partner IHG, by creating new restaurant facilities and new talent to deliver on-trend experiences.
New in-room technologies
As Crowne Plaza hotels and other brands in our portfolio largely cater to business travellers and to the corporate and MICE market segments, in another planned value-add to increase guest satisfaction and stay preference, we will roll out new in-room technologies across certain portfolio hotels following successful prototyping conducted last year. We are focused on delivering improved technology and connectivity within our hotels and an overall quality experience through greater flexibility and personalisation.
voco – Gold Coast
A new opportunity for trading growth in our Group in 2019 is our recently acquired voco Gold Coast property. During Q3 & Q4 of 2018 the hotel went through a refurbishment and rebranding to launch as the first IHG ‘voco” branded hotel in the world. The hotel commences the 2019 year now primarily positioned as one of the Gold Coast’s leading upscale hotels equipped with a fresh new product and service culture to lure guests seeking an on-trend experience. This, we expect, together with the low Australian dollar helping to drive increased domestic tourism and the upgrade works at the Gold Coast airport delivering increased airlift capacity, will drive a significant increase in annualised earnings from this property.
Expectations for year ahead
With the outlook for 2019 and two new hotel builds scheduled for 2020, Salter Brothers will this year launch a significant capital raise towards our stated target of $1billion.
Our focus for the coming year will be to maintain a competitive edge across our portfolio through the deployment of refurbishments and value-add initiatives. In particular, the changes to restaurant and bar offerings across the Group will emerge as a key point of difference and innovation.
The culture at Salter Brothers is about thinking differently, encouraging our 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 we believe underpins our success.
Our achievements and investments over the last twelve months have set us up for an exciting year and we are looking forward to working hard and building on this success throughout 2019.
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