Home' Hotel Management : HM APL 2016 Contents properties have a lower development cost, are faster and easier to build
and enjoy better returns. We will continue to selectively invest in the right
properties in the right locations.
The markets in which we operate remain undersupplied with an
increasing demand for affordable quality accommodation. Our customers,
both business and leisure, are looking for good value and a good night's
sleep -- the ibis brand is perfectly placed to deliver this.
Has performance of your hotels in Australia matched
your expectations, and how much potential for
growth exists in the Australian hotel sector?
Our first hotel development in Australia, ibis Glen Waverley, has been
very successful. The hotel is doing well in a strong corporate market. The
opportunity to acquire the ibis Budget at Melbourne Airport was also a
great investment opportunity for us. Whilst our growth has originally been
opportunistic in Australia, we will selectively continue to grow in Australia.
You have built a relationship with AccorHotels over the past
decade, how important are owner-manager relations for you?
Our relationship with AccorHotels is very strong and the owner-
operator relationship is vital to the success of any hotel investment.
We partner with leading hotel brands like Accor that provide first class
operational expertise, strong marketing and distribution capabilities and
consistent quality offerings.
The accommodation sector is notoriously cyclical, but have you
found that AccorHotels has been able to consistently deliver
above-market performance irrespective of the cycle?
Most of our guests are business travellers and as a result we are less
Action Hotels' Founder and Chairman,
Sheikh Mubarak Al-Sabah
Sheikh Mubarak Al-Sabah's Action Hotels PLC has surprised
many hotel property observers in Australia by targeting the
economy hotel sector, but his astute choices have shown a very
keen eye for market trends.
The Kuwaiti entrepreneur founded the Action Group over a decade ago,
and he has since built an extensive portfolio of commercial real estate in the
Middle East, Europe and Australia.
With locally-based Andrew Nehme, he entered the Australian market
in 2008, with the purchase of the ibis Melbourne Glen Waverley, and
despite the GFC, the investment proved an immediate success, tapping
into Melbourne's commercial growth along the eastern corridor. That was
followed by the purchase of the ibis Budget Melbourne Airport, and the
group's newest addition -- ibis Styles Brisbane Elizabeth Street -- which is
set to change the face of economy hotels in Brisbane.
You chose to make your first foray into the Australian
hotel scene in the middle of the GFC, why did you
choose Australia ahead of Europe or Asia?
Action Group has been an active investor in the Australian real estate market
for a number of years, so it is a market we know extremely well and have been
able to access prime sites and hotel opportunities. We have enjoyed a close
relationship with AccorHotels for nearly 10 years especially in the Middle East
and were the natural choice of partner to work with in Australia.
Our first hotel in Australia, ibis Glen Waverley, opened in December
2007. Glen Waverley was a location which lacked quality, value for
money three-star accommodation for the local businesses. The location
is optimal as Glen Waverley is a popular business hub and is in close
proximity to Melbourne's city centre as well as the airport, catering to
both business and leisure travellers and has traded strongly since opening.
When you decided to invest in Australian hotels, many
commentators thought that you would be looking for top-end
hotels, but you deliberately chose a 3-star product and in a non-
CBD location -- why was ibis your first hotel choice in Australia?
We have a very contrarian investment style and are driven by value
creation for our shareholders. We believe that the branded 3-star hotel
market remains undersupplied in many locations throughout Australia
and we identified Glen Waverley as being in this category. There are a
number of large international companies in Glen Waverley that require
good quality affordable accommodation with little supply.
You have gone on to extend your ibis network, purchasing
the ibis at Melbourne Airport and now building the new
ibis hotel in the Brisbane CBD, you clearly have a preference
for the economy and mid-market sectors. Why?
Action Hotels PLC is a leading owner, developer and asset manager of
branded 3 and 4 star hotels across the Middle East and Australia and
are actively growing the portfolio.
Economy and mid-market hotels remain our key focus as these
Action Hotels' Chairman
SHEIKH MUBARAK AL-SABAH
HM sits down with the man behind global investor
Action Hotels' success, the company's Founder and
Chairman, SHEIKH MUBARAK AL SABAH.
30 HM The Business of Accommodation
AN ACCOR HOTELS PROMOTION
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