Home' Hotel Management : HM AUGUST 2016 Contents Limited backed by well-known hoteliers, the Sarin Family. This will
mark the arrival of the Holiday Inn Express brand to New Zealand when
it opens in 2018.
Judging by the immediate success of Holiday Inn Express Sydney
Macquarie Park, this is a brand that will continue to attract business and
leisure guests, and deliver extremely high yields.
Development Manager - Acquisitions
Why is budget and economy one of the most popular
segments in the industry at present?
Like most goods and services, hotels must offer a
compelling value proposition to successfully influence
the markets they seek to attract. Whilst this idea is
not exclusively about pricing, the underlying appeal of the economy
accommodation segment is undeniably about affordability.
Low-cost hotel rooms have a long history of speaking to budget-
conscious travellers who value experiences and destinations above a menu
of in-house extras (that are inevitably either extra costs or built in to their
room rate). And today this cohort of travellers is larger, more mobile, and
more diverse than ever.
Whether motivated by the new world order of low-cost air travel,
tightening corporate travel budgets, or the instant price comparisons
the internet affords them, most travellers' expectations of affordable
accommodation are about far more than a psyche of finding a cheap
room. It's the way they prefer to travel.
Which are your key brands in this space and why should developers brand
Since 2004, Mantra Group has stayed true to our three-brand strategy,
avoiding the trend of complex hierarchies and concentrating our efforts
on building the profile of the Peppers, Mantra, and BreakFree names.
Mantra Group's offering in the economy segment is the BreakFree
brand, which has been an accommodation name of choice for over 15 years.
Today, the portfolio includes 25 properties, located across Australia and New
Zealand, where fresh, contemporary accommodation combines great value
with access to the best beaches, city highlights and holiday attractions.
A positive bi-product of the distinct market positioning of our brands
has been the clear perceptions that developers and hotel investors share.
Like our guests, the hotel investment community understands where
BreakFree 'fits' in the hotel landscape.
Importantly, the BreakFree name can be adapted to resorts, serviced
apartments, and hotels, meaning that developers and hotel owners can
benefit from a powerful brand solution, regardless of the location or scale
of the property.
What are your expectations for budget/economy hotels when it comes to
development over the coming 12-18 months?
Mantra Group engages in the full range of hotel operating models,
meaning we're in a position to have flexible conversations about leases,
management agreements, marketing agreements, management rights
purchases, and freehold acquisitions. With that approach, we have the
advantage of being well positioned to capitalise on a range of expansion
opportunities for the BreakFree brand.
In particular, we are seeing growing developer appetite for new
building technology, such as modular construction. This approach is
clearly well-suited to the economy hotel segment due to its affordability,
however, it is equally encouraging to see developers exercising
imagination in the execution of their plans.
From a hotelier's standpoint, we welcome the coming together of
low-cost construction with innovative design as it facilitates viable
development solutions whilst delivering a distinctive product with a
global pedigree. We expect to see more of this juxtaposition, particular in
its application to limited service hotel developments.
What are your latest budget/economy projects in the pipeline?
In recent months, Mantra Group opened BreakFree hotels in
prominent Sydney, Melbourne and Christchurch CBD locations, in
response to our loyal customers' desire to access the brand in even more
destinations they visit for leisure and business.
As a continuation of this strategy, BreakFree's ongoing portfolio growth
will be characterised by more footholds in the Asia Pacific region. This will
not only occur through our engagement in all management models, but
also as a hotel owner, in line with Mantra Group's mandate to selectively
acquire hotel assets in capital city and iconic leisure destinations.
Area Vice President - Business Development
Why is budget and economy firmly still one of the most
popular segments in the industry at present?
At SilverNeedle Hospitality, we see that the lines
are blurring between live, work and play and if people
no longer see boundaries, why should we in hospitality
create them? There is a change in attitude by travellers seeking simplicity,
connectivity, flexibility and value surrounded by well-developed
infrastructure invested in fringe and second-tier city centres, this adds to
the convenience and demand for the economy style hotel for both leisure
and business travellers. With the saturation of hotels being built in city
centres of capital markets, we are reminded of a 'two-speed economy'
as pricing is getting pushed artificially high with strong competition for
assets right now, in particular in Sydney and Melbourne.
For investors, the preference of budget- and economy-style, provides a
stronger return on equity.
What are your key brands in this space and why should developers brand
The brand portfolio of SilverNeedle Hospitality is designed with
travellers in mind, to meet their expectations. They are the tech native
corporate travellers along with the emerging Gen Z travellers.
A new brand in our current portfolio will be announced in Australia when
construction begins and software infrastructure is finalised. In the context of
the current generation of travellers, it is important hospitality transforms.
The industry is grounded in the traditional real estate business - it is
room and product-centric, yet in the age of the connected traveller; the
global citizen, their values have changed and SilverNeedle aims to align
itself with those values and needs. We have to keep testing, keep coming up
with ideas to become the developer's key partner, as leaders of innovation.
Developers invest in us as a cohesive team that blends techies and
hoteliers. SilverNeedle Hospitality is led by the son of the co-founder of
Infosys Technologies, and the strategy is based on his vision of combining
scale with customisation in hotels.
What are your expectations for budget and economy brands when it comes to
development over the coming 12-18 months?
We expect that individual customer behaviour and the ability to
understand will eventually be critical in our prediction that will change
the way we look at the customer, such as customer segmentation and
channel mix will change -- there will be nuances which technology can
help us pinpoint.
BreakFree Aanuka Beach Resort
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