HM February 2019 by The Intermedia Group

IN THIS ISSUE

WHY HOTELS NEED TO RESPOND QUICKLY TO NATURAL DISASTERS MAXIMISING GUEST LOYALTY AND DIRECT BOOKINGS

DISRUPTING THE DISRUPTORS AND BEATING THEM AT THEIR OWN GAME INSIDE THE WORLD’S BIGGEST DATA MACHINE

THE BUSINESS OF ACCOMMODATION IN ASIA-PACIFIC Vol.23 No.1 Bi-monthly February 2019

2019 INDUSTRY LEADERS FORUM HM surveys the leading industry opinions, challenges and targets for the year ahead

New era for

TFE Hotels It’s a new year and TFE Hotels has outlined its resolutions for 2019. With a new leader set to take charge, the company says it’s ready to achieve

HOT THIS MONTH Industry regulation, innovation, elections to come, tourism booming and more

CONTENTS

February 2019

Vol. 23 No.1

22 THE 2019 INDUSTRY LEADERS FORUM

The most comprehensive accommodation industry outlook for 2019, featuring exclusive columns from the region’s leading owners, hoteliers, major suppliers and association and tourism leaders

24 TOURISM LEADERS

A 2019 outlook from Tourism Australia, AAoA, TAA, TIANZ and TTF

30 GLOBAL LEADERS

HM gets an exclusive outlook for 2019 from some of the biggest names in the hotel business

45 LEADING SUPPLIERS

Seven of Australasia’s top suppliers give HM their predictions for the 12 months ahead

52 LEADING OWNERS

Three of Australasia’s eminent hotel owners look at what to expect in 2019

Brisbane searches are on the rise with Expedia’s US market

IN THIS ISSUE

MAXIMISING GUEST LOYALTY AND DIRECT BOOKINGS DISRUPTING THE DISRUPTORS AND BEATING THEM AT THEIR OWN GAME INSIDE THE WORLD’S BIGGEST DATA MACHINE

THE BUSINESS OF ACCOMMODATION IN ASIA-PACIFIC Vol.23 No.1 Bi-monthly February 2019

2019 INDUSTRY LEADERS FORUM

18 EXPEDIA’S COMMANDER

HM’s Editor-In-Chief sits down with the CEO of Expedia Group, Mark Okerstrom, to find out the latest with the world’s largest travel company

Regulars

HM surveys the leading industry opinions, challenges and targets for the year ahead

06 EDITOR’S LETTER

New era for

James Wilkinson on the industry outlook for 2019

TFE Hotels It’s a new year and TFE Hotels has outlined its resolutions for 2019. With a new leader set to take charge, the company says it’s ready to achieve

08 NEED TO KNOW

HOT THIS MONTH Industry regulation, innovation, elections to come, tourism booming and more

On the cover

Presented this month by TFE Hotels. Pictured is the TFE Hotels Senior Executive Team at Vibe Hotel, North Sydney.

Expectations for the year ahead from Australasia’s leading hoteliers

HM Q&A

WHY HOTELS NEED TO RESPOND QUICKLY TO NATURAL DISASTERS

56 AUSTRALASIAN LEADERS

The 17 essential stories you need to know this month – spanning operations, development and tourism industry news

71 hotelmanagement.com.au 5

EDITOR’S LETTER Managing Director Simon Grover

Publisher

Expectations high for a successful 2019

James Wells

Editor-In-Chief

James Wilkinson jwilkinson@intermedia.com.au

s we head into 2019, expectations across the accommodation and greater travel industry worldwide are for another bumper year. The travel sector is currently experiencing significant growth, boosted by the proliferation of low-cost airlines and new hotels in the Asia-Pacific region, alongside record numbers of new routes by full-service airlines and consumer confidence for travel in 2019. In the past few weeks alone, Virgin Australia revealed 83 per cent of customers say they expect to travel at least – if not more – in 2019 as they did in 2018, while the world’s largest travel company, Expedia Group, says it’s expecting travel globally to grow by 5.3 per cent compared to 2018. At the 2019 Americas Lodging Investment Summit (ALIS) in Los Angeles, which was held in late January as this edition of HM went to press, Hilton’s President and Chief Executive Officer, Christopher J. Nassetta, told delegates it would be a strong year for the company. “We have big plans to continue to grow, innovate and positively impact the world around us, and we expect that 2019 will be our best and most dynamic year yet,” he said. It is a sentiment that is being echoed here in Asia Pacific as the region prepares for another year of sustained growth. “As a result of a buoyant market and new supply there is no doubt that market performance of operators is very important and in terms of demand we are seeing strong growth throughout the Pacific region,” said AccorHotels’ Chief Operating Officer – Pacific, Simon McGrath. Over the 76 pages of this special leaders forum edition of HM, you’ll find confidence right across Australia, New Zealand, the South Pacific and greater Asia Pacific region as hotels and airlines expand at record levels. To find out just what you can expect, we have again put together the most comprehensive accommodation industry outlook in Asia-Pacific from the leading hoteliers, owners, suppliers and tourism executives in the region. I hope you enjoy our especial Industry Leaders Forum edition of HM and I wish you all the best for a prosperous year ahead. Yours in hospitality,

James Wilkinson Editor-In-Chief, HM hotelmanagement.com.au AccorHotels’ Chief Operating Officer, Pacific, Simon McGrath.

MEET THE HM TEAM…

James Wells Publisher

Matt Lennon Deputy Editor

6 HM The Business of Accommodation

Adam Daff Group Sales and Sponsorship Manager

Adrian Tipper Creative Director

Deputy Editor

Matt Lennon mlennon@intermedia.com.au

Group Sales and Sponsorship Manager Adam Daff adaff@intermedia.com.au

Contributing Writers

Peter McBrearty, Carol Giuseppi, Richard Munro

Production Manager Jacqui Cooper jacqui@intermedia.com.au

Circulation and Subscriptions Manager

Chris Blacklock cblacklock@intermedia.com.au

Subscription enquiries

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Things You Need To Know The essential hotel and travel news and trends from across the globe. Get the latest news every week at HotelManagement.com.au

Dr Jerry Schwartz purchases first Queensland hotel Prominent hotel investor taps into Gold Coast market

Hotel and tourism industry magnate Dr Jerry Schwartz has purchased the Hilton Surfers Paradise hotel from Chinese group Ja Feng for AUD$70 million. The transaction is the first for the Schwartz Family Company, which prior to this sale owned 13 hotels and resorts in New South Wales, the ACT and Victoria. Among the existing portfolio is the Sofitel Sydney Darling Harbour and Crowne Plaza Hunter Valley. Along with the land and building ownership, the purchase also includes management rights to the 169room hotel and 200 apartment residences. Also on site are four restaurants and bars, four swimming pools, conference and event spaces, a day spa, car park and an expansive outdoor deck area. Dr Schwartz said the Gold Coast was perfectly placed to take advantage of ongoing growth in both domestic and international traveller markets, particularly from Asia and the Pacific, so it was “the perfect time to enter the market”. The Hilton transaction will be finalised in May 2019.

Hilton Surfers Paradise is steps from the centre of town

8 HM The Business of Accommodation

THINGS YOU NEED TO KNOW 04

Insta standouts Movers and shakers this month on Instagram

Travellers love Ovolo Woolloomooloo’s quirky design 02

TripAdvisor names Australia’s best hotels Poll comes from posted online guest reviews Feedback from TripAdvisor members and users has placed Ovolo Woolloomooloo in Sydney’s inner-city as Australia’s Best Hotel in the travel website’s annual Travellers’ Choice Awards for 2019, the company has announced. The hotel, housed within one of Sydney’s historic finger wharves in the trendy harbourside enclave, is steps from a number of the city’s most celebrated restaurants and trendy bars and offers creatively designed loft rooms. Ovolo Hotels also claimed third place in the poll, with Ovolo 1888 Darling Harbour, on the other side of the city, voted into third place. The world’s largest travel site bases its Travellers Choice Awards each year on the standard of feedback posted by its users for a particular hotel across millions of reviews posted in a single year. The poll disregards quality standards in hotel marketing and star standards, basing outcomes solely on the opinions of its posted reviews.

01 Ovolo Inchcolm, Brisbane @ovolohotels

02 Loyalty to BW 03

@bestwestern

Hilton unearths its future culinary and bar superstars Next-gen talent nurtured from within

Barista Cup winner Nickie Chan in her element Hidden food and beverage passions and skills among Hilton’s Australasian team were thrust into the spotlight as the company hosted its annual 2019 Food & Beverage Masters finals. Hosted at the Hilton Sydney, the annual showcase sees finalists from Hilton group hotels around Australia compete for titles across four F&B disciplines – the Culinary Cup, Wine Cup, Barista Cup and Bar Cup. Always a hotly contested competition, the talent pool at the 2019 edition of the event was as tight as ever, with categories open to all Hilton employees except for Executive Chefs. However, it was Hilton Brisbane which almost scooped the pool, leaving with three of the four major awards. Claiming the Culinary Cup for 2019 was Chaoyi “Charlie” Song, while colleagues Chris Barker took home the Wine Cup and Andrew Purse headed home with the Bar Cup. Hilton Sydney’s Nickie Chan was the night’s fourth winner, claiming the Barista Cup. Entrants in the contest, as well as team members at all levels throughout Hilton, are given access to professional development to further their careers within the company. These may include on-the-job-training, virtual courses, management development programs and seminars.

03 Next Hotel, Brisbane @nextbrisbane

04 Vibe Gold Coast @tfehotels

hotelmanagement.com.au 9

THINGS YOU NEED TO KNOW

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Senior Westfield executive to lead TFE

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TFE Hotels appoints new CEO

Australia.

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Expat Australian Antony Ritch has been named as the new Chief Executive Officer at TFE Hotels, following a global search to replace former boss Rachel Argaman. Ritch will take command of TFE from February 2019, relocating from his current senior role in Los Angeles as Executive Vice President of Shopping Centres and Venues with Westfield Corporation offshoot OneMarket – which became a standalone company following Westfield’s merger with Unibail Rodamco. He brings over 20 years’ experience in a variety of senior executive roles to his new post with TFE Hotels. “I have always admired the TFE Hotels business, and I’m thrilled to be joining the team in Australia. As travel and hospitality continue to evolve globally, I am excited by the unique opportunities that TFE Hotels’ growing portfolio and guest experiences will bring to this dynamic industry,” Ritch said. Silky Oaks Lodge is positioned deep in the Daintree rainforest 07 06

Baillie Lodges buys Silky Oaks Lodge… First move just weeks after investment deal Baillie Lodges has moved fast, announcing a new addition to the fold in the Daintree National Park in North Queensland. Nestled along the Mossman River, Silky Oaks Lodge will become the fifth member of the Baillie Lodges family, joining long-time stablemates Capella Lodge, Southern Ocean Lodge, Latitude 131 and the soonto-open Remarkable Lodge in Tasmania. The new addition, also recognised as a member of Tourism Australia’s ‘Luxury Lodges of Australia’ group, marks the entry of the Baillie group into Queensland. Guests at Silky Oaks Lodge can indulge in naturebased activities including bushwalks, driving safaris and river snorkelling as well as access to Port Douglas and the Great Barrier Reef. As part of the Baillie Lodges collection, the property will be able to take advantage of a wider distribution network, operational expertise as well as capital for future property enhancements and new product development. Staff at the property will be absorbed into the Baillie network, giving them opportunities to relocate to other lodges within the group when chances arise. 10 HM The Business of Accommodation

…just five weeks after signing joint-venture with KSL Investment Investment plants seed for new luxury lodges Luxury experiential lodge operator Baillie Lodges has outlined a plan to significantly expand its network of premium and remote accommodations following a major investment by private equity firm KSL Capital Partners. An affiliate of the firm has confirmed the purchase of a major stake in the company to help it identify opportunities to develop new and unique luxury lodge and travel experiences. The new venture will continue to be operated by company founders James and Hayley Baillie. With the extra capital at their disposal, Baillie Lodges will be able to grow its network both in Australia and in new markets overseas. KSL Capital Partners said the company was open to the idea of expanding the Baillie Lodges vision to other parts of the world. Hallmarks of the Baillie Lodges brand will be rigorously maintained with any potential additions to the network. The company says these hallmarks include luxury accommodation in highly remote and natural locations which offer access to unique Australian experiences while upholding a commitment to sustainability.

Southern Ocean Lodge on Kangaroo Island

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THINGS YOU NEED TO KNOW Ne wi n

ries

rity bring t heir own secu

Tech brand to build on success in hospitality

du st

Restructure for Assa Abloy to expand into new markets

ll e cha

Security technology firm Assa Abloy Hospitality has announced an internal restructure designed to take further advantage in the growth of its hospitality operations and pursue opportunities in new industries. The company says the newly renamed Assa Abloy Global Solutions will allow it to cater to new security challenges in more diverse market segments. The company’s existing Hospitality division will now sit under the wider Assa Abloy Global Solutions umbrella as one of several new market-specific business units. New units will be established focusing on the marine industry, aged care, student housing, asset management, logistics and more. Each vertical will operate with a direct sales channel, with the company’s entire suite of products and services to be rolled out across all business units.

es ng

TFE Hotels unveils new-look Adina Coogee New look evokes a relaxed beachfront lifestyle A major, multi-million dollar renovation project has been completed at the Adina Apartment Hotel Coogee, with managing firm TFE Hotels pulling the curtains back to reveal the finished product. Decked out in a grey, caramel, teal and navy colour palette, the range of 86 self-contained studio, one and two-bedroom apartments now feature a much brighter, energetic look and feel, aimed at delivering guests an example of beachside living in Sydney’s eastern suburbs. The new interior design came as a collaboration between TFE Hotels’ inhouse design team and design brand D’Cruz, intended to evoke feelings of a relaxed lifestyle with the city still only a few kilometres away. All apartments feature new kitchen and laundry facilities along with free wifi connectivity. Guests can also access a modernised gym and indoor swimming pool along with inner courtyard area.

Rooms have adopted a calming ocean-inspired colour palette

12 HM The Business of Accommodation

Oaks Port Douglas is a highly popular destination for families 10

Oaks Hotels increases FNQ with Port Douglas purchase Adds second property north of Cairns

Freehold interest in the premises and adjoining land of QT Port Douglas in Tropical North Queensland has been acquired by Oaks Hotels and Resorts as the serviced apartment brand grows its presence in the state’s north. The 170-room property has transferred its management rights to Oaks Hotels and is now operating under the new name. The resort will operate in tandem with the existing Oaks Lagoons property a little over a kilometre away. Oaks Port Douglas becomes the group’s 56th branded property Australia-wide. It is located close to Four Mile Beach and five minutes from Macrossan Street, the town’s main dining and shopping strip. Designed to suit the relaxed lifestyle of its surroundings, the property features a tropical theme around a mixture of studio rooms, one and two-bedroom apartments, each offering views over the resort’s landscaped gardens or swimming pool with swim-up bar. Each room is fitted with king beds, private balconies or courtyards and lounge areas.

THINGS YOU NEED TO KNOW Kakadu’s iconic Crocodile Hotel draws tourists from across the globe

Kakadu Tourism to benefit from government funding Both sides of federal politics commit to spend in Kakadu

Promises are flying thick and fast ahead of this year’s federal election, with the two main combatants pledging millions to build tourism in Kakadu National Park. In a year where the park celebrates its 40th anniversary in April, up to AUD$220 million is on the table from both the Liberal National and Labor parties to go toward upgrading the region’s ageing infrastructure. Improvements will include upgrading roads, accessibility and camping facilities as well as establishing Jabiru as the park’s beating heart and central element to tourism. Kakadu Tourism has indicated it would like to make its attractions accessible year-round and no longer inhibited by wet season rainfall and flooding. The organisation cited one of its “most prized attractions” being open only for two months, saying it was “clearly not good enough”.

Marriott International ushers in ‘Bonvoy’ loyalty program Three loyalty programs become one

LVMH owns many elite liquor and fashion brands 12

Belmond to join luxury LVMH conglomerate Follows board pledge to drive activity for shareholders The LVMH Group (Moët Hennessy Louis Vuitton) has acquired Belmond Ltd – a collection of 46 luxury hotels, restaurants, trains and river cruises – for USD$3.2 billion (AUD$4.5 billion). Belmond’s move to sell and go private comes as part of a company review set up to stimulate market activity for shareholders. The company operates in 24 countries including Thailand and Indonesia, with luxury hotels in its portfolio such as the Belmond Jimbaran Puri in Bali and Belmond Napasari in Koh Samui. In addition to its namesake brands, LVMH also owns global household names such as Dom Pérignon, Veuve Clicquot Ponsardin, Christian Dior Couture, Givenchy, Marc Jacobs, Sephora, TAG Heuer, Hublot and more.

Bonvoy will come into effect from February 13

Three long-standing, iconic and individually successful hotel industry loyalty programs have been amalgamated into one by Marriott International, which has announced ‘Bonvoy’ as the singular entity soon to encompass its three merged programs. The new brand marks the next completed phase in the Marriott Starwood merger first detailed last August, with Bonvoy replacing the Marriott Rewards, Ritz-Carlton Rewards and Starwood Preferred Guest (SPG) programs. Marriott websites and mobile apps for all three predecessor programs will be deactivated on 13 February, automatically redirecting users to the new Bonvoy platform. Logos and branding will also begin rolling out globally to all consumer touch points from this date, including all sales channels, co-branded credit cards and in more than 6,000 hotels in 130 countries. Alongside the unveiling of the new name, perhaps the biggest change for members is the introduction of two new loyalty tiers splitting the current Elite status into two levels. ‘Marriott Bonvoy Titanium Elite’ replaces Platinum Premier Elite for members who stay more than 75 qualifying nights in a year. The pinnacle of the program will be the ‘Marriott Bonvoy Ambassador Elite’ tier and will be exclusively reserved for members spending more than USD$20,000 and staying more than 100 nights per year.

hotelmanagement.com.au 13

THINGS YOU NEED TO KNOW 14

Crystalbrook Collection to expand into Newcastle Group to build hotel in former Council building

‘Kingsley’ will be the city’s first five-star hotel

Newcastle’s iconic circular ‘Roundhouse’, which currently houses the Council Administrative Centre, will be transformed into the city’s first five-star hotel, with Crystalbrook Collection announcing it will open a new property in the Hunter harbour city at the end of 2020, to be named ‘Kingsley’. Initial surveys indicate a hotel development of 100 rooms will feature inside the property. Renderings from Barney Collins of EJE Architecture also show plans for a rooftop swimming pool, restaurant and recreation area. The title ‘Kingsley’ is an adaptation of Newcastle’s original name of Kingstown, which dates back to 1804 and continues the company’s tradition of using gender-neutral labels. Crystalbrook Collection is in the middle of an $800 million phase of expansion and investment covering six new hotels and resorts either operating or under construction.

Perri Projects names Ovolo to manage new Melbourne hotel

Has been playfully dubbed the ‘shopping trolley’ hotel

Will be the second Ovolo in the Victorian capital Melbourne’s rapidly growing CBD south precinct will welcome the city’s second Ovolo hotel from 2020, with the energetic brand selected by developers to manage a new AUD$50 million designer hotel in the area. Located around an even distance between the Yarra River through the CBD, Albert Park and Port Phillip Bay to the city’s south, the new Ovolo South Melbourne will feature 100 rooms in the brand’s customary ‘uber-trendy chic’ style. It will become Ovolo’s second Victorian hotel alongside Ovolo Laneways on Little Bourke Street. New for Ovolo in the announcement is that its new South Melbourne development will be the company’s first property on which it holds only management rights. Its ten other hotels in Australia and Hong Kong are all fully owned by the company in addition to being managed under its own brand. Construction on the new six-storey Ovolo hotel will begin later this year and is due to open to guests in 2020.

Hotel is located in South Melbourne, near Albert Park

14 HM The Business of Accommodation

Quirky hotel design plans revealed by MONA

‘Motown’ hotel to be partially suspended over the Derwent River Tasmania’s Museum of Old and New Art (MONA) has officially unveiled its longrumoured on-site hotel project, with formal paperwork for an estimated AUD$400 million development lodged with Glenorchy Council. The hotel project has been on-again, off-again for some time, with plans for a 90room hotel first mooted back in 2013 and then again two years later. Designed collaboratively by MONA Owner David Walsh along with Nonda Katsalidis, the planned suspension bridge design – panned by some as resembling a shopping trolley – has been accepted as something of a hybrid between the two. Plans call for a five-star, 176-room visual masterpiece offering guests views of nearby Mt Wellington or the Derwent River. Public facilities in the works include an outdoor concert stage, indoor theatre seating 1,075 people, day spa facility, conference rooms and an auditorium for smaller parties seeking a plenary format. Dining options will consist of a 180-seat public restaurant and 50-seat bar. A dedicated art centre featuring a variety of newly commissioned and sourced pieces will be housed within the hotel, along with some special “experience rooms” which hint at an interactive art experience for guests. In addition, a carpark, upgraded jetty and outdoor playgrounds for kids also feature in the design.

THINGS YOU NEED TO KNOW 17

CBRE Hotels says domestic tourism will thrive in 2019

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for the re

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A low AUD and hot new Queensland resorts to drive local demand

p reo The

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Holidays under the perpetually warm Queensland sun are expected to be a major driving force in Australia’s tourism industry in 2019, as the state significantly raises its game to cater to luxury-seekers. That is one of the key predictions from hotel asset manager and real estate broker CBRE Hotels, which cited the low Australian dollar as a catalyst to driving up domestic tourism as medium and long-haul overseas options become less affordable. Recent months past and the first half of 2019 has seen a significant upshift in the scale, variety and grandeur of North Queensland hotel options as ‘Riley’, the first of three new five-star options from the Crystalbrook Collection opened in Cairns. The opening was the city’s first ever five-star product and first major new hotel product in over two decades and reflected the scale of the associated AUD$500 million investment from Dubai’s GA Group. Sister properties ‘Bailey’ and ‘Flynn’ are on track to open in the middle and latter months of 2019 respectively. In addition, the reopening of Daydream Island and Hayman Island in the Whitsundays will breathe new life into the state’s far north as competition heats up. Work is also expected to continue on Great Keppel Island and Dunk Island to further prepare the once-popular destinations for future revivals. Conversely, growing housing supply in the capital cities of Melbourne and Sydney are creating suggestions the short-term letting market may be shaping for an influx in new inventory – a move which may put pressure on hotel room prices. CBRE said it expects hotels in Australia’s two biggest cities to weather the storm but not without breaking a sweat or two.

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AUSTRALIA’S OUTSOURCED HOTEL HOUSEKEEPING LEADER FOR OVER 25 YEARS hotelmanagement.com.au 15

AN HM x TFE HOTELS PROMOTION

A new CEO and growing to 100 hotels worldwide As TFE Hotels’ new Captain, Antony Ritch, prepares to take the helm this month, the company is heading into unchartered waters of prosperity with major growth milestones on the horizon both at home and abroad

Front row L-R: Shaizeen Contractor; Allan Vidor Middle row: Michael Herman; Michelle Bevan Back row: Chris Sedgwick; Gino Sorrentino

or Australian-based international hotel group, TFE Hotels, 2019 heralds one of the biggest phases of growth seen for quite some time. With fourteen hotels under active construction and a development pipeline of 28, the company is striding towards a key milestone of 100 properties in its global portfolio. Of these, seven are underway in Australia and a further seven in Germany, solidifying TFE’s targets for global expansion. Back home and after an exhaustive global search for the right candidate, TFE Hotels will this month welcome new Chief Executive Officer, Antony Ritch, a distinguished international executive who will lead the team through this extraordinary period of growth and beyond. Returning to his homeland of Australia after several years abroad, Antony is an Australian with a global career spanning 20 years with Westfield Corporation. During his accomplished career to date, he has held a diverse range of senior roles across Australia, the USA and the UK which have honed his leadership, commercial and entrepreneurial skills. In his time with Westfield, Ritch has held international roles in shopping centre operations, property development, regional operations, business development, digital disruption and corporate management. “TFE Hotels is delighted to have Antony onboard. With his proven track record and extensive leadership and entrepreneurial skills, he will 16 HM The Business of Accommodation

play an invaluable role in leading our team and supporting our growing global pipeline of new and existing hotels,” says Allan Vidor, Chairman of TFE Hotels. Antony’s experience of over 20 years in bringing property management and digital strategies together will be invaluable as TFE Hotels fills over 700 new hotel and operational roles, while continuing to be a leader in hotel technology solutions.

NEW HOTEL OPENINGS

In 2018, TFE Hotels added four new properties to its portfolio in key destinations. Kicking off with Adina Serviced Apartments in Dickson, Canberra, TFE Hotels followed this with the cool and contemporary Vibe North Sydney, which has helped reinvigorate the bustling business precinct north of the Bridge. Developed by Cromwell Property Group, the redeveloped Northpoint offers guests access to an exciting “eat street” and new retail precinct and a rooftop bar and pool opening later this year. In Brisbane’s premier fashion and lifestyle precinct, James Street, TFE Hotels recently launched Australia’s first urban resort, The Calile Hotel. Part of the TFE Hotels Collection, a portfolio of beautiful discovery hotels with a sense of story, place and purpose, The Calile is an example of modernity and relaxed sophistication. Bursting onto the local scene, it has

COVER STORY

ob er 201 8

advanced gym equipment and personal training, in a boutique space with well-considered and luxurious facilities. Australia’s most sought-after O in fashion labels, including Dion Lee, d The Calile opene Bassike, Venroy, Bec & Bridge and Love Stories, have opened new Queensland flagship stores on the ground floor of the hotel, fronting James Street and the hotel entrance. In Melbourne, TFE Hotels has also recently unveiled a reimagined Art Deco gem, The Savoy on Little Collins, Melbourne (once the famous Savoy Plaza), after a multi-million-dollar refurbishment. Across the Tasman in New Zealand, 2020 will see the Hotel Britomart open in Auckland’s burgeoning upmarket urban precinct. Both of these new properties will operate under the TFE Hotels Collection brand.

TFE Hotels’ Chairman Allan Vidor has been acting as the company’s interim CEO during a period of transition

“As travel and hospitality continue to evolve globally, I am excited by the unique opportunities that TFE Hotels’ growing portfolio and guest experiences will bring to this dynamic industry.” Antony Ritch – Incoming CEO, TFE Hotels already built a global reputation for itself as a must-visit hotel for 2019 and beyond. The Calile Hotel’s 175 generous guest rooms include nine suites and two premier suites. Each is designed with an individual balcony, Bluetooth sound bar, motorised blackout blinds, 55-inch flat screen television and complimentary new-release movies. Numerous elegantly decorated and versatile event spaces cater to everything from intimate culinary soirees such as poolside cocktail parties to elaborate wedding parties for up to 500 people in its grand ballroom. The Lobby Bar, on the ground-floor, offers a contemporary space to enjoy cocktails inspired by Brisbane and its surroundings. Flagship restaurant, Hellenika, opens out to the pool terrace and has an exciting modern Greek menu, similar to its award-winning sister restaurant by Simon Gloftis on the Gold Coast. The restaurant has a vast 600 square metres of dining space and poolside cabanas. What a way to live! One of Australia’s top wellness and spa facilities completes the Calile experience. Meaghan South, of Brisbane’s famed Dome Retreat, has opened KAILO Wellness Medispa on the pool deck level, boasting 10 treatment rooms. A holistic wellness experience combines ancient wisdom with modern approaches to skin health, medical aesthetics and beauty essentials. Brisbane Cosmetic Medicine Specialist Dr Edwina Morgan heads up a team of therapists and doctors. Forme Fitness offers technologically

HOTELS UNDER CONSTRUCTION

Looking ahead, there is excitement aplenty concerning the Vibe brand. Construction is well underway at Vibe Hotel Hobart; Vibe Hotel Sydney Darling Harbour, Vibe Hotel Queen Street, Melbourne – and the Vibe Hotel Adelaide has just been signed. Vibe Hotels are known for their appeal to the millennial set with social spaces and inspired design. This marks a huge milestone for the brand, which will soon have 12 hotels around Australia, after first launching in Sydney in 2003. Since its debut in 1982, the Adina Apartment Hotels brand has become a major brand with 36 hotels in five countries – and at least another 13 in the pipeline. These include several apartment hotels which will create new lifestyle precincts for the cities in which they will be located. The former Pentridge Prison in Melbourne will be transformed into a spectacular Adina Apartment Hotel, creating a destination in itself with apartments, an outdoor cinema and microbrewery all contributing to the local flavour. An Adina in Canberra will offer a ‘Theatre Lane’, forming a new foodie and retail precinct for the city centre. At Melbourne’s West End, an exquisite Adina hotel draws on a rainforest and futuristic elements in its design, with a yoga pod, massage studio, Jacuzzi, indoor lap pool and indoor garden ‘social hub’. Later this year, Adina will open in Southbank, Melbourne, and in 2020 there are two new Adina hotels set for Fremantle in Western Australia and a stunning new-build in Sydney’s CBD on George Street. Also on the horizon are Travelodge Hotels in Auckland and Adelaide, with a fresh new design ethos for the brand.

EXPANDING IN GERMANY

TFE Hotels is the second largest operator of serviced apartments in Germany, with 11 Adina Apartment Hotels under management, according to a Horwath HTL report. In 2017, the brand’s 10th year in Germany, TFE opened two beautiful new Adina hotels in hip Leipzig and in the port city of Hamburg. In all, seven new Adinas are scheduled to open in the coming years. Antony Ritch will this month take charge of a shining hotel portfolio which is also brimming with potential in its development pipeline. “I have always admired the TFE Hotels business, and I’m thrilled to be joining the team in Australia. As travel and hospitality continue to evolve globally, I am excited by the unique opportunities that TFE Hotels’ growing portfolio and guest experiences will bring to this dynamic industry,” says Antony. “It’s a very exciting time to join.” n hotelmanagement.com.au 17

HM Q&A Brisbane is high on the radar for the United States tourists in 2019

THE WORLD’S LARGEST TRAVEL COMPANY, EXPEDIA GROUP, IS EXPECTING 2019 TO BE A RECORD YEAR, AS TRAVEL CONTINUES TO GROW AT A PHENOMENAL RATE GLOBALLY. THE PROJECTIONS WERE A HIGHLIGHT OF EXPEDIA’S EXPLORE ‘18 GLOBAL PARTNER CONFERENCE, HELD RECENTLY IN LAS VEGAS, WHERE HM EDITOR-IN-CHIEF, JAMES WILKINSON, CAUGHT UP WITH SEVERAL OF THE COMPANY’S SENIOR EXECUTIVES.

his year is shaping up to be a massive year for Expedia Group, with the world’s largest travel company set to exceed USD$100 billion in total gross bookings for the first time. At the company’s Explore ’18 global partner conference, attended by over 4,500 delegates at Aria in Las Vegas, Expedia Group CEO Mark Okerstrom reported the company’s total gross bookings at September 30 2018 was at USD$97.5 billion - a 13 per cent year-on-year jump. Based on a 2019 travel outlook by PhocusWright – which revealed travel bookings globally are forecast to increase by 5.3 per cent compared to 2018 – Okerstrom said the company was on target to reach the key USD$100 billion milestone in a year where he was “extremely

18 HM The Business of Accommodation

optimistic” about the success of the travel market globally. “The opportunity in Asia-Pacific is absolutely massive,” he told HM. “That will be a key market to help get us over the USD$100 billion mark. Okerstrom said one of the keys to success in AsiaPacific was the growth of online travel bookings, which now counts for 40 per cent of all travel transactions. An interesting point to note, Okerstrom said, was how fast it took Asia-Pacific to reach that 40 per cent mark compared to the North America at 47 per cent, a region which has had access to better technology for a much longer period of time. “If you think about how long it has taken for North America to grow online to just south of 50 per cent, it is a really long time given Expedia started (in North America) 20 years ago,” he said. “One of the big barriers has been internet connectivity and now broadband cellular and WiFi has (finally) changed the game. Then, there’s the cost of mobile devices, which now is only USD$100 for a smartphone. “When Expedia started, it was going to cost you USD$1,500 for a PC and you had to pay AOL USD$20 a month to get your dial-up. Those restraints don’t actually exist any more in Asia and most places. “Secondly, one of the other biggest hurdles has been credit card penetration and with the proliferation of alternative payment types and digital wallets – and you can see the growth of that in India, Indonesia and other parts of Asia – many barriers are removed and

HM Q&A

“We will see over time whether the concern about rate parity mellows out and I suspect it probably will.” MARK OKERSTROM, Chief Executive Officer, Expedia Group it’s providing very quick penetration. “Add to that a middle class, which is growing faster than ever before particularly in many Asia-Pacific countries. “[This all means] there is potential for very significant growth in travel and with the barriers being broken

EXPEDIA BY THE NUMBERS $97.5 BILLION

Total gross bookings at end of Q3, 2018

675 MILLION

Monthly online visits

343.5 MILLION

Rooms nights booked at end of Q3, 2018

60 MILLION

Contracts handled annually

1.8 MILLION

Active Corporate Travellers

895,000

Global hotel partners

150,000

Online travel agents powered

10,000

Affiliate partners

Countries where Expedia is present

down, it is making it very easy to travel and people are wanting to go away on their first trip, be it to places like New York or Phuket. “We are here to help breakdown the barriers of travel and our purpose is to bring this world within reach.” Okerstrom said artificial intelligence continues to be on the rise – through devices like Amazon Alexa and Google Home – and that should also help enable online bookings to achieve record levels in many global markets during 2019. He said the company has also seen a rise of independent, unbranded hotels using Expedia Group’s platforms to offer their best rates and that’s seen a shift away from customers booking branded hotels. It has also raised the question of whether rate parity will continue to be a major issue in markets globally, including Australia. Okerstrom said he believed the rate parity issue would “mellow out” and that was following the experiences of working with airlines and other travel companies in the past. “Airlines experimented a long time ago with something called ‘web fares’, where flights were cheaper on their sites than they were on the OTAs [Online Travel Agents] and it wasn’t successful,” Okerstrom said. “I think they have learned from that and they have embraced the fact that we are a great partner and we have a huge audience that’s way bigger than they will ever have and the point is to use this platform to get your best prices out there and the same goes for our car rental partners. “Hotels have gone and put in their own book-direct strategies in place and put discounts on their own sites,” he told HM. “What we have seen is independent hotels have come in and given our customers incredible offers. Our customers have been choosing those offers, not the ones that are cheaper somewhere else. And those chain hotels have drifted to the bottom of the sort order and the market works itself out.” “We will see over time whether the concern about rate parity in this dialogue mellows out and I suspect it probably will,” Okerstrom said.

Expedia Group also used the Explore ’18 global partner conference as an opportunity to reveal the latest travel trends amongst Americans, with several Australian cities firmly on the radar for one of the world’s best-spending and most frequent travelling populations. Expedia’s 2018 Year in Review crunched airline and accommodation data over the past 12 months and the biggest trend reported was Americans venturing to secondary destinations such as Brisbane and Perth, alongside the rise of non-traditional lodging options and a return to architectural landmarks. According to Expedia, the results show that American

travellers are increasingly interested in unique and novel experiences. Secondary destinations like Brisbane and Perth, Chiang Mai (Thailand), the Azores (Portugal) and Cartagena (Colombia) recorded double or triple-digit growth from last year, as did non-traditional lodging options such as ‘tentalows’ and houseboats. In the activities and attractions space, observation decks and architectural landmarks saw the biggest growth, with cooking classes and other culinary experiences close behind. “In this day and age, it’s possible to have the exact type of experience and trip you want, whether it’s visiting a breathtaking island off Portugal, or staying on a family farm where you can gather your own fresh eggs in the morning,” said Brand Expedia’s Senior Vice President, John Morrey. “Being able to meet the needs of every kind of traveller is our driving force at Expedia, and why we strive to make it easy and affordable to find the perfect accommodation for any trip and bundle it with flights or car for even more savings.” While traditional resorts and hotels continue to be a favorite for United States travellers, Expedia data shows a growing interest in alternative lodging options. Some of the fastest-growing accommodation types for 2018 included: Tentalows (cross between a tent and a bungalow) – up 135 per cent year-over-year; Chalets – up 85 per cent year-over-year; Villas – up more than 45 per cent year-over-year; Agritourism properties – up more than 40 per cent year-over-year and Houseboats – up more than 35 per cent year-over-year. On the activities front, setting the pace were observation decks, architectural landmarks and culinary experiences, with the Eiffel Tower, Rome’s Colosseum, the 360 Chicago Observation Deck and the High Roller Observation Wheel in Las Vegas some of the most popular. n

hotelmanagement.com.au 19

PRESENTS

Meet the Board It’s shaping to be another big year for the Accommodation Association of Australia. We are proud to have shaped our National Board of Directors which we will introduce here. We believe the advocacy challenges facing the accommodation sector are in infinitely qualified and capable hands under the careful watch of the following group of esteemed individuals. PRESIDENT – JULIAN CLARK (Lancemore Group)

Julian is the Chief Executive Officer of The Lancemore Group, a family owned and managed business and one of the largest boutique hotel operators in Australia. Julian has extensive experience in the accommodation industry and in his current role manages several iconic properties across Australia that regularly feature in Gold Lists and Good Food Guides. Julian is also a past board member of Victorian Tourism Industry Council (VTIC).

DEPUTY PRESIDENT – SIMON MCGRATH (AccorHotels)

Simon is the Chief Operating Officer for AccorHotels Pacific, responsible for over 385 hotels, 53,000 rooms and 21,000 employees in this region. He has had an extensive and highly respected career in the hotel sector, having worked in management positions in major cities in Australia and Asia including Malaysia and Thailand. Simon holds positions on industry boards including: Deputy Chairman of TTF, Deputy President of AAoA and outside of industry, holds the position of Independent Director of GenesisCare.

TREASURER – BRUCE COPLAND (Independent Director)

Bruce is a professional company director and hotelier who has worked in the hotel, hospitality, tourism and related consulting business since 1969. A former Chief Executive Officer of Toga Hospitality, he continues to serve on the board of TFE Hotels. Bruce is a Director of McKenzie Scott & Associates, providing consulting services and back-office systems to a wide variety of companies across Australia. Bruce is the Chair of the Audit and Finance Committee, overseeing all remuneration, accounting and compliance issues for the Association.

COLIN HUGHES (Independent Director)

Col’s background is in Aviation, having held senior Executive positions at Cathay Pacific Airways, Continental Airlines, Northwest Airlines and Qantas in Australia, Asia, Europe, Middle East and USA. He is a member of the Australian Institute of Company Directors (AICD) and Director International Operations for Aviation Online (AOL). Among other Directorships, he is also past Chair of Business Events Sydney (BES) as well

He was appointed to this role in April 2012 after joining Choice Hotels in 2002. Trent has been at the forefront of property growth for Choice Hotels throughout his 15-year tenure and has developed and implemented strategic, growth focused business plans, leading to substantial increases in group RevPAR and business delivery.

BARRY ROBINSON (Wyndham Vacation Clubs)

Barry Robinson serves as the President and Managing Director of International Operations for Wyndham Vacation Clubs, overseeing operations of the company’s timeshare business outside North

America. He served as President and Managing Director of Wyndham Vacation Resorts Asia Pacific for 14 years, driving significant property acquisitions and enhanced resort developments. He was also responsible for leading Wyndham Hotel Group’s growth across South East Asia and the Pacific Rim. The service culture that Barry strives for at Wyndham Vacation Clubs is to create personalised, memorable experiences at every customer touchpoint.

DINO MEZZATESTA (The Star Sydney)

Dino Mezzatesta was appointed the Chief Operating Officer (COO) at The Star Sydney in January 2019. Responsible for the property’s day to day management and operations and in guiding the delivery of outstanding guest and team member experiences, his appointment comes following two years as COO of Hotels, Food & Beverage and Retail. With more than 30 years in the corporate travel and leisure markets, Dino is deeply experienced in hospitality and hotel management, leadership and setting solid strategic direction.

CHRIS SEDGWICK (TFE Hotels)

Chris Sedgwick has been the Chief Operating Officer for TFE Hotels since April 2017 and is responsible for over 70 hotels, 10,000 rooms and 2,500 employees across Australia, New Zealand, Germany, Denmark and Hungary. Prior to TFE Hotels, Chris worked with AccorHotels for 10 years in various leadership and executive roles. He has over 22 years’ experience in the hospitality industry and has held senior leadership, management and executive positions in key Australian city and tourism destinations as well as internationally in New Zealand and Thailand.

RAMY FILO (Classic Holidays)

as being the Chair & Co-founder of the National Tourism Alliance (NTA).

TRENT FRASER (Choice Hotels Asia-Pac)

Trent is the Chief Executive Officer for Choice Hotels Asia-Pac – the largest Hotel Franchisor in the region, with more than 300 properties. 20 HM The Business of Accommodation

Ownership Council.

Ramy is the Chief Executive Officer of Classic Holidays, a timeshare resort management company with 34 Resorts representing 65,000 timeshare owners in Australia and New Zealand. He is also the current President of the Australian Timeshare and Holiday

KEY NEWS

Around 100 people turned up to our event in Melbourne

Upcoming Accommodation Association of Australia Events HOTEL MARKET UPDATE – SIGNATURE EVENT SERIES

Don’t miss the opportunity to hear valuable presentations from industry leading analysts who will provide insights into trends, opportunities, threats and market dynamics. Listen to the latest in market intelligence, analysis and performance outlook for the local hotel market, which will assist with budget preparations and marketing plans to better prepare your strategies and manage your hotels’ performance moving forward. Presentations will be designed to provoke thought, discussion and exchange of ideas to assist you with improving your hotels’ performance in the short and longer term.

LOCATIONS AND EVENT HOSTS INCLUDE:

• Melbourne Hotel Market Update (6th February 2019 at William Angliss Institute) • Brisbane Hotel Market Update (19th February 2019 at Novotel Brisbane) • Gold Coast Hotel Market Update (20th February 2019 at Mantra on View) • Adelaide Hotel Market Update (21st May 2019 at Intercontinental Adelaide) • Canberra Hotel Market Update (23rd September 2019 at Hotel Realm) • Cairns (Date and Location TBA) • Perth (Date and Location TBA) • Hobart (Date and Location TBA) • Sydney (Date and Location TBA)

LOCATIONS AND EVENT HOSTS INCLUDE: • Launceston (1st March 2019 at Mantra Charles Hotel) • Bendigo (28th May 2019 at Quality Hotel Lakeside) • Ballarat (29th May 2019 at Mercure Ballarat Hotel and Convention Centre) • Byron Bay (Date and Location TBA) • Darwin (Date and Location TBA)

OTHER EVENTS TO LOOK OUT FOR

• Launch of the National Advisory Board for Employment (4th April 2019) • ATHOC Golf Day (14th May 2019) • ATHOC – AAoA Industry Race Day – Gold Coast (22nd June 2019) Visit our website www.aaoa.com.au or email events@aaoa.com.au for more information on our upcoming events. Our round-table Strata Breakfast was highly effective and energised.

ADVOCACY UPDATE WITH ACCOMMODATION ASSOCIATION CEO, RICHARD MUNRO

These advocacy update sessions provide members with the opportunity to hear from the Accommodation Association CEO, Richard Munro, discuss our advocacy agenda and ongoing work in tackling issues within the industry. hotelmanagement.com.au 21

Special Report

THE INDUSTRY LEADERS FORUM THE ACCOMMODATION INDUSTRY’S ‘CONFERENCE IN PRINT’ IS BACK FOR 2019. WE HAVE COMPILED THE MOST COMPREHENSIVE WRAP-UP OF THE HOTEL LANDSCAPE IN AUSTRALIA, NEW ZEALAND AND THE ASIA-PACIFIC. INSIDE, YOU’LL FIND CANDID COMMENTS FROM LEADING OWNERS, HOTELIERS, MAJOR SUPPLIERS, ASSOCIATIONS AND TOURISM LEADERS, ALL IN THEIR OWN WORDS. Compiled by James Wilkinson and Matt Lennon

22 HM The Business of Accommodation

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TOURISM LEADERS

John O’Sullivan

Managing Director, Tourism Australia 2018 was another strong year for Australian tourism with continued growth in both domestic and international travel. AS WE WELCOME in the 2019 new year, it is an opportune time to reflect on the immediate opportunities for Australian tourism as we work together with industry towards achieving our shared Tourism 2020 goals. This growth in 2018 contributed to overnight visitor expenditure once again reaching record levels and placing our industry closer to achieving the Tourism 2020 target of AUD$115 billion annually later this year. The latest figures (year-end September 2018) confirm overnight tourism expenditure from domestic and international visitation grew eight per cent year-on-year to AUD$113.4 billion. We saw domestic overnight spend grow 10 per cent to AUD$70.3 billion and international visitor spend growing five per cent year-on-year to AUD$43.2 billion. There was continued solid growth in international visitor arrivals, reaching 9.2 million for the first time following a six per cent increase on the previous year. The strongest growth in visitor numbers was boosted by markets such as India (up 19 per cent), Hong Kong (up 12 per cent) and China (up nine per cent). Western markets such as the USA and UK also posted steady increases at three per cent and two per cent respectively. Increased aviation capacity and new routes – coupled with improved air competitiveness – assisted demand from our source markets, with increases in aviation capacity from China (up 20 per cent), Hong Kong (up 10 per cent), and Japan (up eight per cent). Stable capacity was also maintained across most of our target markets. Whilst we remain optimistic about the outlook, against the backdrop of a strong 2018, we are also mindful of the possibility of new challenges and as we have seen in this age of disruption, our operating environment can change quickly. Disruption has seen supply (primarily accommodation and transport) and demand impacted (as more of our marketing has shifted to digital platforms). In recent years too, we have seen the strength of the Australian dollar start to impact visitor spend. However, the softening of the Australian dollar towards the end of 2018 and start of 2019 may increase the propensity for international visitors to spend more when they are in Australia in the coming year. Working in our favour, we know from our research that Australia continues to be a highly desirable destination across all of our key markets. Despite this, competition from other destinations that are closer and more affordable remains fierce. To counter this, our focus is on reaching high value travellers, who are most motivated by what we have to offer and are most likely to choose Australia for their next holiday or business event. 24 HM The Business of Accommodation

“In recent years, we have seen the strength of the Australian dollar start to impact visitor spend.” John O’Sullivan – Managing Director, Tourism Australia It is also about doing fewer things but with more dollars, in the right channels, with the right message and with the support of distribution partners – that’s how we can make a bigger impact as we have seen with the recent ‘Dundee’ campaign. The campaign was the largest we’ve run in the United States since Paul Hogan’s famous ‘Come Say G’Day’ ads of more than 30 years ago and is about bringing the country and its experiences to life through the personality of our people which we know is incredibly powerful in inspiring international travellers towards booking and boosting leads for industry. In South and South East Asia, the new $10 million ‘UnDiscover Australia’ campaign launched in late 2018 seeks to dispel long-held myths about Australia as a destination in the key markets of India, Indonesia, Malaysia and Singapore and to encourage further dispersal and repeat visitation. It is the first time that Tourism Australia has launched a single coordinated campaign for the region and we look forward to continuing this campaign in 2019. To enhance our relationships with the international trade who sell Australia for leisure and business events, our two signature events – the Australian Tourism Exchange and Dreamtime – will both be hosted in Perth this year. It is a perfect opportunity to highlight the extensive new tourism developments in the city to our most significant stakeholders in key overseas markets to help build future business for Australia. So, 2019 promises to be another exciting year for Australian tourism. Let’s see what it brings.

The ‘Dundee: Son of a Legend’ ad aired during the 2018 Super Bowl

TOURISM LEADERS

WE HAVE BEEN working hard on the issues our members want us to improve, based on feedback we have received through surveys, digital media and directly through 45 forums the AAoA held last year to update the industry. We have been engaging actively with Government and Opposition, attending and representing the industry at Parliamentary inquiries on the issues of the impact of OTAs and non-compliant accommodation in both state and federal jurisdictions. My verdict would be that all of our advocacy is starting to bear fruit, with key decision makers better informed and keen to help our industry. The number one priority that continues to come through are issues around rate parity and the terms and conditions that the OTAs operate with accommodation suppliers. The second biggest issue was non-compliant accommodation, or the impact of Airbnb. The AAoA has worked tirelessly on both of these issues, with a decision pending from the ACCC on rate parity clauses and unfair contracts. ACCC Chairman Rod Sims has advised that the new legislation passed in 2017, “The Misuse of Market Power Bill”, would be the law being used to ascertain if the OTAs are allegedly misusing market power by lessening competition. We know that the ACCC has moved on a case against Trivago, alleging that it made misleading hotel pricing representations in its television advertising and website, in breach of the Australian Consumer Law. “Based on Trivago’s highlighted price display on its website, we allege that consumers may have formed the incorrect impression that Trivago’s highlighted deals were the best price they could get at a particular hotel, when that was not the case. Trivago based its rankings on the highest cost per click it would receive from its advertisers,” is what the ACCC’s Rod Sims said. He went on to say, “we are very concerned that such platforms convey an impression that their services are designed to benefit consumers, when in fact listings are based on which supplier pays the most to the platform”. The AAoA has also informed the Federal Government and the Opposition, who are considering options if the ACCC does not act soon.

Richard Munro

Chief Executive Officer, Accommodation Association of Australia The number one priority that continues to come through is issues around rate parity with OTAs.

The AAoA’s NSW Advisory Board

One issue that does not get a lot of press that the National Board of the AAoA has identified, is the shortage of skilled and semi-skilled labour. The AAoA has established an Academy to drive employment outcomes. We have also appointed a National Advisory Board of Employment (NABE) to oversee strategy and initiatives to help our industry overcome the shortage and prioritise outcomes with key stakeholders that will lead to employment into our sector. Australia has a unemployment rate of circa 5 per cent, but interesting that the youth unemployment rate declined sharply in 2018, which is where we are focusing our efforts to attract new talent to the accommodation industry. The other initiatives we rolled out in 2017-18 were our new State Advisory Boards in NSW, QLD and VIC as well as our National Advisory Board of Employment (NABE) – which is charged with moving the needle on the availability of employees and the skills that we need to man our industry – working closely with the AAoA. We have set up two other committees for an Energy Buying Group and a Direct Booking Taskforce, both of which are working on those critical issues and both advising the National AAoA Board. The National Board hosted the AGM, at which Julian Clark was re-elected as President, Simon McGrath as Deputy President and Bruce Copland as Treasurer. We also welcome Ramy Filo, President of the Australian Timeshare and Holiday Ownership Council, with which AAoA has formed an alliance to grow our industry. I anticipate changes in the industrial relations landscape if there is a change of government. Any new government will do well to remember we’ve had three successive increases to the minimum wage in the last three years, which have been absorbed into our businesses. Any growth of minimum wage over 3 per cent makes it very difficult for our industry to simply pass this cost on to consumers in the room rate. hotelmanagement.com.au 25

TOURISM LEADERS

Carol Giuseppi

CEO, Tourism Accommodation Australia In 2018 the Australian visitor economy continued its strong growth trajectory. However, there are mixed messages in terms of the economy.

EXPENDITURE BY INTERNATIONAL visitors reached AUD $43.2 billion (year ending September 2018), up 4.8 per cent. Domestic visitor spend continued to break records, increasing by 10.3 per cent to AUD$70.3 billion. Tourism Research Australia’s forecasts indicate the industry is well on track to hit the low end of the Tourism 2020 goal of $115 billion in overnight visitor expenditure. While unemployment rates are at an all-time low and consumer sentiment is strong, low wages growth, tighter-than-expected credit conditions and housing price falls could cause consumer spending to soften. Further, uncertainty around the global outlook could affect business confidence and investment. Despite this, continued low interest rates and a low AUD mean 2019 is expected to have some upsides for the tourism sector. Conditions remain largely positive for growth in 2019, but the industry faces ongoing challenges. These include access to labour and skills; sustainable investment in hotel supply; and improved airline and visa access. The accommodation sector supports close to 200,000 full-time equivalent jobs directly and indirectly with employment growing by 7.1 per cent in 2016-17. Low unemployment, a strong supply pipeline, a labour force which does not see hospitality as a career and tightened skilled migration settings have all combined to place increased pressure on access to labour and skills. We will continue to reinforce the importance of a skilled migration framework that, while maintaining integrity, is more responsive to our needs. The ‘TAA Hotel Labour Benchmarking Survey’ revealed over 19 per cent of all employees in our sector are international workers – filling vacancies the local labour supply can’t meet. It is an excellent sign that both major parties are aware that more proactive policies are needed to encourage Australians into VET pathways. The National Centre for Vocational Education Research figures to June 2018 shows the continuing decline in food trade worker and 26 HM The Business of Accommodation

hospitality worker apprenticeships. Both parties have announced VET reviews. This acknowledges the decline in the number of students enrolled in publicly-funded VET and the decline in Federal and State funding. Maintaining a proactive approach to working with the government to reinforce the importance of filling labour and skills shortages both from local and global markets remains a priority of ours, while developing initiatives such as the Hotel Career Expo - inspiring students to explore career opportunities with the industry. We have long advocated for the importance of demand-led supply through investment by all three levels of government in the visitor economy (marketing, events, business events and infrastructure). In 2018, we welcomed the business events bid fund commitment by the Federal Government (AUD$12 million over three years), however, our research shows funding for Tourism Australia is not keeping pace with media inflation – which is growing at around two to five times the CPI across Australia’s key and developing tourism markets. Equally important is the need for government to address barriers to investment such as availability of sites, planning timeframes and the implementation of improved regulatory controls on short-term holiday letting, if investor confidence is to be sustained. Last year, we saw increased regulatory activity in most states around short-term holiday letting and we welcomed the introduction of data matching by the ATO. However, there remains a need for governments to agree on a national system requiring the registration of residential premises used for short stay accommodation, so they meet a range of health, safety and tax requirements. As an island nation, Australia is reliant on international aviation access to facilitate visitor growth. Bilateral air services agreements and associated arrangements are critical. The historic ‘Open Skies’ agreement with China and the new Air Services Agreement with India will both have a significant impact on visitor growth beyond 2019. Equally, visa fees and processing times need to be benchmarked to ensure we remain competitive. Our research showed that when all fees are added, Australia is one of the most expensive for visa costs. The benchmarking of visa fees, along with online visa processing and improved aviation access, will be key to ensuring Australia’s continued competitiveness. In 2019, our priority remains to reinforce the economic benefits of tourism and strengthen confidence in the visitor economy.

“The TAA ‘Hotel Labour Benchmarking Survey revealed over 19 per cent of employees are international workers – filling roles the local supply can’t meet.” Carol Giuseppi - Tourism Accommodation Australia CEO

TOURISM LEADERS

Chris Roberts

Chief Executive, Tourism Industry Aotearoa Many people who work in the vast and varied tourism industry will tell you that what they love about their career is the knowledge that no two days are the same. WHETHER YOU WORK in food and beverage, accommodation or adventure tourism, the wonder of our industry is in the people you meet and the experiences you can enable. So, they’re absolutely right. It can be exhilarating being part of such a dynamic industry, especially one that has just surged through a period of intense growth. Everyone in our industry has contributed to growing the total value of tourism to New Zealand’s economy to more than NZD$39 billion a year – that’s $107 million a day. We are well ahead of our projected markers to reach our Tourism 2025 goal of being a $41 billion per year industry by 2025. Further growth is expected but not at the same giddy rate. This presents an opportunity for us to play ‘catchup’ and double our efforts to ensure this growth helps, not hinders, our industry players. The aforementioned dynamism of working in tourism means New Zealand is well known for providing outstanding visitor experiences, good old Kiwi hospitality, and (usually) top-notch customer service. A key focus in 2019 is ensuring that the expansion of the hospitality and accommodation sectors doesn’t come at the expense of maintaining our famous Kiwi welcome or a decline in service quality, and I can identify three areas as particularly crucial to this. The first issue of importance is staffing. Data from the 2018 Tourism Satellite Account shows that 216,000 people are directly employed in tourism – eight per cent of all the people employed in all of NZ. That’s 5,400 more people working in tourism than a year earlier. However, regional staff shortages have been and will continue to be a cause for concern, and we need to find answers for the regions and sectors that struggle to find staff. To come up with answers, we need to understand the issues. In 2018, together with Auckland Tourism, Events and Economic Development (ATEED), we researched young people’s perceptions of careers in tourism. From the research findings, we are now developing a supporting strategy to help attract people into tourism jobs. It is also encouraging to see the proactive

“Regional staff shortages have been and will continue to be a cause for concern, and we need to find answers.”

measures being taken by some hotel chains to provide opportunities for both school leavers and beneficiaries. The Government has committed to addressing this issue too. It is currently consulting on a new framework for employer-assisted temporary work visas. The proposals should ensure that access to overseas workers is better matched to where there are skills shortages. We believe the Government’s proposed changes are a step in the right direction and recognise the significant regional differences in requirements for workers. TIA will be submitting on the proposals. We need to employ more Kiwis, but we must always retain access to overseas workers when suitable locals are not available. The second way to ensure hotels retain strong growth is in recognising investment opportunities. Hotel returns in New Zealand have climbed in the past five years, as they needed to in order to attract investment and encourage refurbishment. The hotel sector has seen a flurry of activity, but it is largely 4.5 to 5-star properties being planned and built across the country. There is also a strong market demand for 3-star hotels, but this band remains under-invested and doesn’t always have the capacity to meet demand. Investment decisions still need to be made prudently. National occupancy, as measured by TIA’s long running Hotel Sector Survey, surpassed 80 per cent in 2016 and has remained around that level since as new inventory has been absorbed. Average room rates in places like Queenstown and Rotorua continue to increase, but in Auckland and Wellington we are now seeing small declines in both average occupancy and rates. Thirdly, I cannot ignore the everlasting issue of local taxes. Many councils across New Zealand are keen on collecting new taxes, levies or rates and see the accommodation sector as an easy target. The worst example in recent times was Auckland Council’s targeted accommodation rate (often incorrectly referred to as a visitor levy or bed tax). A strong campaign led by TIA narrowly failed to defeat the proposal but did see the target for the new rate reduced from $28m to $13m a year. This still imposed enormous rate increases on many Auckland hotels and motels. And as we predicted, a promise to extend the rate to Airbnb properties has come to little, with the Council struggling to identify those who should be paying it. We note that peer-to-peer letting offers additional choice to consumers and that it fills an important need, especially over peak periods. However, this sector needs appropriate management, particularly of those operators that provide short term visitor accommodation on a year-round basis. The sector should provide fairness and provision of a safe and compelling visitor experience. We don’t want a repeat of the Auckland fiasco. The desire by local government for new funding sources is not going away, so TIA is working to develop a preferred regional tourism funding model that balances the interests of visitors, businesses and local communities. Any new funding model needs to be fair, applicable nationally, and supportive of further tourism growth. hotelmanagement.com.au 27

TOURISM LEADERS

Margy Osmond

Chief Executive Officer, TTF Australia With a Federal election looming, the Government and Opposition must make our industry a priority.

IF OUR VITAL sector is to flourish, we need governments to make serious investments in its growth. This includes a commitment to stop unfairly taxing tourism, making it easier for visitors to come into Australia as well as a greater investment in destination marketing. Anything less and we risk falling behind our global competitors. Last year, I called on our industry to take the time to better understand digital disruption, rethink how we approach traditional trends and customer expectations, evolve innovatively and embrace the challenges and opportunities that ultimately will strengthen the tourism sector. Technology-facilitated growth of the ‘sharing economy’ in tourism such as Uber, Camplify and the short-term home-sharing options has enabled business and travellers to better leverage idle resources and infrastructure through a global market. Accommodation is the backbone of the visitor economy and while traditional providers will always be the mainstay of the sector, consumers are voting with their feet and showing us all that short-term holiday letting is now also a key part of the offering. We should embrace the disruptors in our industry. Backed by the right legislative framework, each additional night stayed has a dramatic positive impact on the visitor economy. Millions are moving into the middle class, with higher disposable incomes and a taste for adventure, travel and unique experiences – but the competition for these tourists is heating up with more countries seeing the economic and social benefits of growing tourism. This boom in visitation supports both jobs and business confidence across Australia, particularly outside our cities, where the latest results show 2.8 million international visitors – or around one in three of all international visitors – explored a regional destination. I’ve long said the visitor economy can no longer be viewed as “flip-flops and cocktails”. The statistic that makes that true, and that should be repeated over and over again is, tourism contributes $110 billion to the nation’s wealth each year and supports almost a million direct and indirect jobs. What’s more – as much as 43 cents in every dollar spent on tourism in Australia is spent in regional destinations. But if we want people to continue visiting Australia, we have to market ourselves at a level that ensures we are keeping pace with the efforts of our key competitors. Stopping successive governments from seeing tourism marketing as an easy victim for the fiscal knife to balance a budget is a major challenge and needs to be a key priority for the industry – it is the definition of a false economy and must not only stop, but in fact be reversed. 28 HM The Business of Accommodation

“Stopping successive governments from seeing tourism marketing as an easy victim for the fiscal knife is a major challenge and needs to be a key priority.” Margy Osmond – Chief Executive Officer, TTF Australia Another handbrake on the competitiveness of our industry is the cost of and ease of applying for visitor visas. If Australia is a burdensome, expensive or difficult place to visit, tourists won’t come to spend their money. There are too many cost-competitive alternatives lining up to take potential visitors away from Australia for us to continue to behave like this. A small fee to cover the cost of administrating the visa system is fair but using international visitors as cash cows is self-defeating. Similar to visa costs, Australia’s Passenger Movement Charge (PMC) is a billion dollar tax hit on our visitor economy. The PMC was introduced in 1995 to recover the costs associated with border processing and short-term visa issuance. The current PMC at a rate of $60 generates over $1 billion in tax revenue each year and will rise to $1.4 billion by 2021/22, while spending on border management in 2017/18 by the relevant two government departments was a maximum of $616 million – a considerable over collection of revenue. This effectively makes the PMC a ‘super tax’ on the tourism industry. Thankfully, industry muscle resulted in a freeze on the PMC at $60 for five years from 1 July 2017, but there needs to be a long term solution to this ever-increasing cash grab. Our industry is steadfast and united in its belief that any increases to the PMC beyond the freeze period are just not warranted. This is particularly important because tourism is fast becoming the underpinning driver of the Australian economy. Direct tourism employment is forecast to grow nationally from around 598,000 jobs or 4.9 per cent of total national employment up to around 1 million jobs or 7.7 per cent of total national employment by 2022. In a year where we will all be focused on the Federal election, it is essential that all Parties make clear their support for and understanding of this critical industry.

AN HM x ACCORHOTELS PROMOTION

ACCORHOTELS NEWS

The

ErdiGroup way How a Melbourne family’s passion for hospitality led to success as one of the leading hotel owners in Australia.

r Les Erdi and his wife Eva were passionate about everything they did – whether it was in the medical field, hospitality, or community projects. Their first foray in hospitality was in running a hostel in their adopted home of Melbourne. This inspired the pair to set up the ErdiGroup and expand their interests by acquiring properties in Swanston Street, which were then developed into the Swanston and Welcome hotels, now managed by AccorHotels. The Erdis were constant innovators, establishing one of Australia’s first ‘apartment hotels’, then launching the Urban hotel chain and expanding beyond Melbourne to cities such as Geelong, Sydney and Brisbane. The ErdiGroup now has eight hotels under management, and while Les and Eva have since passed away, their legacy and philosophies remain the driving force today, under Chairman Jeffrey Pinch. Pinch has an extensive legal background and is Principal Partner at Marshalls & Dent Lawyers, where he first met the Erdis and became involved in the industry through his work on hotel contracts and management agreements. HM caught up with Pinch recently.

Les and Eva touched the lives of everyone they were involved with. How did you first become involved with them? I became involved with Les and Eva when I was a young and enthusiastic lawyer joining what is now known as Marshalls+Dent+Wilmoth. Les at the time was unfortunately involved in some difficult litigation, which I was asked to handle on his behalf. We established a rapport that lasted over 30 years. Even though it has been over six years since Les’ passing, it still feels like yesterday that Les would be walking the hallways of Marshalls+Dent+Wilmoth greeting all staff with: “Hello darling”, before making his way into my office and saying: “I’ve done a deal”.

In many ways, they were pioneers of hospitality development in Melbourne and then other cities. Was that something that came naturally to them? When Les and Eva first arrived in Australia in the mid-50s, Eva quickly established a boarding house and Les tried his hand successfully in a number of industries. Les quickly became involved in the Commodore Hotel group and built what was the Chateau Commodore in Lonsdale Street (now the Grand Chancellor) and the old Melbourne Hotel. He was instrumental in bringing the first major high-rise hotels to the Gold Coast, including the Iluka Beach Resort and the Chateau Hotel which both still stand. Hospitality was one of Les’ great skills. Everyone – whether they be the porters, staff in housekeeping, the front desk or the General Manager of the hotel – to the most important guests were all his personal friends.

What do you think will be Les and Eva’s greatest legacies in the hospitality sector? Les and Eva leave great legacies in a number of areas, but in the hospitality sector it is the culture that has been passed on to all of their employees. The hotels are peopled by men and women that have been

Leading ErdiGroup property: The Swanston Melbourne Grand Mercure imbued with the spirit of hospitality, love what they do and have a sense of ownership in their workplace and responsivity in giving back to their community. Les was very proud of the fact that he was also a pioneer of the high-rise hotel in Melbourne and Gold Coast.

The ErdiGroup has been a leader in Corporate Social Responsibility over the decades. How important is it for the tourism and hospitality sector to nurture and respect the communities in which they operate? The ErdiGroup believes that with its success, it has a responsibility to give back to the community. This is not new but it has been something that has been passed on from Les and Eva. I am proud to say that each hotel in the ErdiGroup has each year adopted a local charity to raise and contribute funds, which is matched dollar for dollar by the Les and Eva Erdi Humanitarian Charitable Foundation. The funds raised for these charities provide an enormous sense of pride for the staff. Separately, it’s no secret that the ErdiGroup is the key supporter of the Les and Eva Erdi Humanitarian Charitable Foundation, which has provided substantial gifts to the Prince Alfred Hospital, the Royal North Shore Hospital in Sydney and other charitable institutions such as the International Diabetes Institute, Peter MacCallum Cancer Centre and the Jewish National Fund of Australia. Whilst I cannot speak on behalf of everyone, I certainly can say that it gives me an enormous sense of pride to be linked with an organisation that has a such a strong social conscious and dedication to enriching the lives of those around us.

One of Les’ philosophies was that “Work is such a significant part of life that it should be enjoyed – we should genuinely be passionate about what we do and revel in it!” How much does that still define the ErdiGroup ethos? As I said previously, one of the great legacies of Les and Eva was the culture of the ErdiGroup and the family that they have created in their business. Their culture of passion, ownership and enjoyment of what we do continues to be practiced by our CEO Ricky Jeffs. Our team enjoys their work, they take ownership of our hotels and are committed to the guests that walk into our hotels. The ErdiGroup places great importance and value of our culture and believe that it is the mortar in the bricks that holds our buildings together. hotelmanagement.com.au 29

GLOBAL LEADERS

Michael Issenberg

Chairman & CEO Asia Pacific, AccorHotels To say that 2018 was a record year for AccorHotels would be an understatement.

“Innovation in food and beverage delivery will be a major theme for the industry globally for 2019 and beyond.”

IN ASIA PACIFIC, we added 128 new hotels and 23,000 rooms – and that is not even counting the 138 hotels added to the network through the Mantra Group acquisition. This means we opened, on average, a new hotel in the region every three days through organic growth alone. Globally, a new AccorHotels address opened every two days and we are looking to continue this acceleration moving forward. AccorHotels has certainly proven its credentials when it comes to mergers and acquisitions, with accelerated signings following each new addition to the network. For example, since completing the FRHI acquisition, we have signed 44 new Fairmont, Raffles and Swissôtel development projects. Last year we added 84 Movenpick hotels to our network and already we are seeing strong interest from owners in expanding the brand globally. We celebrated a significant milestone with the launch of our 1,000th hotel for Asia Pacific with the opening of the Pullman Tokyo Tamachi – a beautiful hotel that truly symbolises the future of the brand. The Pullman brand has been particularly successful for us in Asia Pacific and globally we will grow the brand by another 44 per cent or another 55 properties by 2022. Over the course of the past four years, the Asia Pacific region has continued to grow in importance, to the point where the region effectively doubled in size between 2015 and 2018 and now represents over 50 per cent of the global pipeline. During this time, AccorHotels has also undergone a major transformation that has seen us grow from a hotel group with a predominantly economy and midscale portfolio to the second largest luxury operator in the world, with a

SNAPSHOT: ACCORHOTELS Number of hotels & rooms (Globally): 4,700 hotels, 685,000 rooms Number of hotels & rooms (Asia-Pacific): 1,070 hotels and 203,476 rooms Number of hotels & rooms (Australia, New Zealand and South Pacific): 341 hotels and 46,935 rooms Number of employees: Globally – 280,000 / APAC – 120,000 / ANZSP – 21,000 Year first hotel opened: Globally – 1967 / APAC – 1982 / ANZSP – 1991 Year the company was founded: 1967 Brands in the organisation: Raffles, Orient Express, Banyan Tree, Delano, Fairmont, SLS, Sofitel Legend, SO, Sofitel, Mantis, MGallery, Rixos, Mantis, Pullman, Swissotel, Angsana, 25hours Hotels, Hyde, Movenpick, Grand Mercure, The Sebel, Art Series, Peppers, Novotel, Mercure, Mantra, BreakFree, adagio, Mama Shelter, Ibis, Ibis Styles, Ibis Budget Head office locations (Globally / APAC / ANZSP): Paris, Singapore, Sydney, Auckland

30 HM The Business of Accommodation

network of more than 720 luxury and premium hotels – over 300 of which are in Asia Pacific. The AccorHotels brand family now features some of the most iconic and respected brands in the world including Raffles, Orient Express, Fairmont, Banyan Tree, Movenpick and Swissôtel. With the increasing importance of lifestyle brands, we acquired a 50 per cent stake in luxury lifestyle empire sbe, which boasts some of the hottest brands in the world including Delano, Mondrian and SLS, as well as some of the most exciting restaurant and nightclub brands. This partnership will play a key role in us innovating our offerings in dining and entertainment within our hotels, while further building on our American guest base. Another trend that will continue in hospitality and tourism will be consolidation as hotel groups continue to look for scale and new brands to drive growth. As a result of our acquisition and investment strategy, AccorHotels is now the most diversified hotel group in the world, offering a 360-degree approach to hospitality, travel and lifestyle that encompasses hotels, private rentals, concierge services, digital solutions, catering, co-work spaces, events management and more. This diversification has made us more agile, more profitable and more global, with a network of world-class brands for every type of traveller. Our business model is well-balanced to allow us to face disruption head-on, while at the same time becoming a disruptor ourselves thanks to investments in innovative digital companies and an innovation lab that encourages new ideas. Our recent transformation has ensured we are well placed in each of these four pillars and I am excited to see what the new year will bring.

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GLOBAL LEADERS

David Kong

President & Chief Executive Officer, Best Western Hotels & Resorts Change is taking place, both inside and outside of the hotel industry, at breakneck speed.

Pr es ti g BW Premier Helena Great Northern Hotel

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32 HM The Business of Accommodation

“It’s no surprise that distribution costs have and will continue to rise with OTA share of business increasing.”

lle

THE DESIRE FOR hotel companies to increase their size and scale is just one of several industry shifts to have emerged out of the current environment of change. With increased scale, brands gain competitive advantages such as elevated brand awareness, stronger loyalty programs, more favorable online travel agency (OTA) terms and greater synergy and cost efficiencies. With so many benefits, it’s no wonder the industry has been transformed in recent years by an unprecedented number of mergers and acquisitions as well as the addition of new hotel brands across segments. This frenetic pace of change is also driving increased innovations in technology, which will remain at the forefront in the years ahead. In today’s fast-changing environment, what was once considered groundbreaking is now either ordinary or obsolete. Today, our industry is embracing and adopting technological solutions at a much faster pace. Developments in areas such as voice assistants (e.g. Alexa) for guest services, mobile check-in and out, mobile keys, robots, chatbots, artificial intelligence, virtual reality and augmented reality will continue to evolve at a rapid pace. More advancements will emerge to enhance the experience at every step of the guest journey. It’s no surprise that distribution costs have and will continue to rise with OTAs’ share of business increasing each year. With increased market share, OTAs gain greater leverage and control. This is a challenge the hotel industry will continue to face in the foreseeable future as our industry is fragmented with diverse opinions from owners, operators and brands on how to address the situation. Exacerbating the challenge is that – just as the hotel industry has changed – so too have OTAs. Expedia and Booking.com have consolidated their market share by buying out most of their competitors. In addition, they have branched into the travel intermediary business. For example, they own some of the largest travel management companies and have massive affiliate networks to distribute our rates and inventory.

Further, they are bolstering their own loyalty programs and have even entered the home sharing business. As OTAs gain further control of their relationship with customers by becoming the default place to book travel, hotels are motivated to serve up even cheaper rates to gain more business. This is a particularly alarming problem in Asia as many hotels jeopardise rate integrity to gain share through OTAs – a practice that will have devastating results when a recession inevitably hits. Another disruptor is Airbnb, which has given rise to a host of other home-sharing platforms. With its innovative approach to technology and effective marketing of the local experience, Airbnb continues to seize market share and push boundaries. While business sourced through OTAs represents a channel shift, not a direct loss of business, with Airbnb and other homesharing platforms, the business is not only shifted, but lost. As these platforms grow, they will continue to rise in number and influence, leading to greater pressure on the industry. We must unite to ensure municipalities enact proper and fair regulations to even the playing field. In 2018, we introduced “Today’s Best Western,” to underscore our 72-year evolution and showcase the excitement and vibrancy of the brand today. As part of our continuous progression, Today’s Best Western now encompasses a portfolio of 13 dynamic brands and we are continuing to expand into new segments. This year, Best Western marked an industry first by introducing a pair of boutique brands – Sadie Hotel and Aiden Hotel. These conversion brands, competing in the upscale and upper-midscale segments respectively, offer guests a unique travel experience with local flair and unprecedented flexibility for developers. Best Western’s other brands have also seen tremendous growth this year and we look forward to continued expansion in 2019. The hospitality industry is seeing fast and dramatic changes but it’s also one of our industry’s most exciting times. Whether for our guests, clients, partners or hoteliers, the future of our industry couldn’t be brighter.

WEATHERDON

GLOBAL LEADERS

Kenneth Macpherson

Chief Executive Officer, Europe, Middle East, Asia & Africa, IHG The drivers of our industry remain strong and this gives us at IHG a clear focus and clarity about what we need to do. In 2019, we are faced with a number of economic and political scenarios – not least with the unknown of Brexit and its impact on the UK, Europe and relationships across the globe. This makes predicting the future fiendishly difficult. Despite this, many things remain constant and positive for those of us in the hotel business. Firstly, the travel industry will continue to be one of the fastest growing sectors in the world. The aviation market will continue to positively impact our industry with intense competition and low airfares supporting both leisure and business travel. No matter how the political discussions regarding Brexit play out, I expect the UK to remain a global travel destination. For example, the UK’s events and conference facilities are consistently ranked as the best in the world, second only to New York. More widely, we see many markets with opportunity, fuelled by active investments which drive growth. Government and business-backed infrastructure projects, tourism destination development, transport connectivity and visa policy enhancements are all contributing. One such market is Australia, where we forecast further growth for those companies with the right brand portfolio to match investor and guest needs. Secondly, the supply environment is favourable. We had good industry growth in 2018, and there is a strong pipeline of new hotels coming through in the months ahead – many of which will be part of the IHG family. Thirdly, digital platforms and technologies continue to evolve at a rapid pace, changing the way all industries deliver for their consumers – including our industry. Finally, I predict we will see further expectations from our stakeholders for transparency in how we all operate our businesses in sustainable and responsible ways. I think the biggest driver we will see in this area in the year ahead are the expectations of our own colleagues. By next year, 50 per cent of our workforces will be Millennials. As we fight to attract and retain the best talent in our industry, we will need to demonstrate that 34 HM The Business of Accommodation

we live the values this workforce wants to be associated with. And that fight for talent is especially important as we all strive to deliver the best possible service levels to increasingly demanding guests. In the year ahead, I predict global travel growth, followed by the longer-term growth of hotel supply, tech improving the guest experience and a positive pressure to share how we operate responsibly. At IHG, we are set to leverage these trends in several areas and focus on them to deliver true hospitality for our guests. We’ve listened to the needs of our owners and guests and growing our global luxury portfolio will be a continued focus for us. Last year, we celebrated our 200th hotel for InterContinental Hotels and Resorts, the world’s largest luxury hotel brand. This followed our acquisition of Regent Hotels & Resorts – a move which reflects our focus on luxury as a driver for our business. IHG can now call itself the UK’s leading luxury operator following an agreement to acquire a portfolio of properties, formerly run under Principal / De Vere brands. This deal gave us the opportunity to bring our luxury boutique Kimpton brand to the UK. Already open in London – and set for Manchester, Edinburgh and Glasgow – the brand is also set to arrive in Bali, Taipei, Tokyo, Barcelona, Paris, Frankfurt and Rotterdam. We’ve responded to consumer needs by launching new brands in high-growth, high-value segments. In the second half of last year, we opened the first property for our new upscale brand, voco, on Australia’s Gold Coast, just five months after the brand’s launch. This is an innovative brand for our owners, and we’ve set out with big ambitions to open 200 voco hotels in the next decade. I am delighted that Germany will be welcoming our newest mainstream brand, avid hotels. This brand has seen a phenomenal response with our owners, with the first open and 150 more in the global pipeline. A multihotel deal will see 15 new hotels brought to Germany. When it comes to technology, we have been working on the rollout of an innovative new cloud-based technology platform, IHG Concerto, which incorporates multiple

“By next year, 50 per cent of our workforces will be Millennials.” Kenneth Macpherson – Chief Executive Officer, Europe, Middle East, Asia and Africa, IHG capabilities including our new Guest Reservation System into one seamless hotel management tool. Doing business responsibly has always been a core part of our culture. Our global presence means we want to ensure a positive impact on the lives of those we interact with. That could be through enabling more sustainable operations through the IHG Green Engage system or making a difference in local communities by providing jobs through the IHG Academy. I feel real momentum inside the business and I am excited for what the year ahead holds.

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GLOBAL LEADERS

Stefan Leser

Chief Executive Officer, Langham Hospitality Group Be it on business trip or a leisure holiday, guests are looking to maximize their experience and time at the destination they are in.

The Langham Chicago

THE LANGHAM EFFORTLESSLY combines the personality and charm of a British classic with a passion for exceptional and unpretentious service. The Langham brand is globally recognised by a playful touch of The Langham pink – we are a key player in luxury but we are not stuffy and also do not take ourselves too seriously. Our timeless and beautifully designed hotels are market leaders, with our Langham Club Lounge concepts that combine a homely feeling with luxurious residential design, offering a haven of peace and escape from the city’s busy days. We also have exceptional contemporary art collections present in the majority of The Langham Hotels and Resorts as well as Michelin star Cantonese restaurants for which the group is renowned. On the other hand, Cordis Hotels and Resorts – our approachable luxury brand – is designed for today’s travellers. Be it for family holidays, couples getaways or the corporate travellers, they will be able to find authentic, quintessentially local experiences in the neighbourhood of each Cordis hotel and resort. People are extremely busy today – distraction and fast pace through

The Langham Sydney

SNAPSHOT: LANGHAM HOSPITALITY GROUP Number of hotels & rooms (Globally): 22 hotels, 9,163 rooms Number of hotels & rooms (Asia-Pacific): 16 hotels, 5,965 rooms Number of hotels & rooms (Australia, New Zealand and South Pacific): 3 hotels, 897 rooms

Number of employees (Globally / APAC / ANZSP): 8,000-plus Year first hotel opened (Globally / APAC / ANZSP): The Langham, London (opened in 1865) Year the company was founded: 2001 Brands in the organisation: The Langham, Hotels & Resorts, Cordis Hotels & Resorts Head office locations (Globally / APAC / ANZSP): Hong Kong

36 HM The Business of Accommodation

mobile devices is omnipresent – so we must ensure they have the best time ever, recharge and go home with unforgettable memories and revived energy. Discerning travellers seek authentic, local experiences but they all want great, personalised service – according to their needs and preferences. At The Langham, our colleagues are trained to observe and deliver service according to the preferences and needs of each individual guest – intuitive yet unobtrusive. At Cordis, we also curate and offer free local tours, taking our guests to enjoy local experiences in the heart of the neighbourhood where the hotel is located. At Cordis Hong Kong, we have local market tours, where our guests can experience the sights, sounds and taste of real Hong Kong. Whether seeking advice on child friendly activities, planning that epic marriage proposal or getting that table at the hottest restaurant in town – it is all about making sure we create unforgettable memories for our guests. With 22 hotels in 20 cities, we recently opened our 10th hotel in China. The Langham, Hefei in Anhui Province is the most beautiful grand hotel in an historic Chinese city. We are very positive and look forward to 2019. We are also very excited about increasing our footprint in Southeast Asia and are looking forward to the opening of The Langham, Jakarta, which is scheduled at the end of 2019. We continue to invest in our assets. The Langham, Boston will be going into a renovation in 2019 and the hotel will be one of North America’s best luxury hotels once the transformation is completed. The Langham Hospitality Group is a key player in the luxury hospitality sector and has an ambitious growth and development plan. We will double our portfolio with more than 30 projects from Asia, Europe and North America to the Middle East currently either confirmed or in an advanced stage of negotiations. China will continue to grow steadily, but we look forward to increasing our global footprint in Europe, the Middle East, Pacific and Southeast Asia. The rise of room sharing – the Airbnb effect – complementing the trend where consumers are seeking customised, personalised holidays and accommodation is positive for the industry. Consumers today have a lot more choices and are engaged across multiple platforms. The luxury hospitality industry needs to constantly evolve and innovate to appeal to the next generation of luxury travellers. However, the unique service and personal touch is still an important element that luxury consumers demand and which a luxury hotel has to deliver.

GLOBAL LEADERS

Craig Smith

President & Managing Director, Asia Pacific, Marriott International There is no hiding the fact that 2018 was one of the most challenging years our company has ever faced.

WHILE HOTELS OPERATED as usual, behind the scenes we integrated our systems across over 1,600 hotels in 110 countries and territories. Through this project of unprecedented complexity and scale, we combined our three loyalty programs into one, consolidated our booking channels and created one global platform. In effect, we have been well positioned to succeed going into 2019. Having added 82 new hotels and more than 19,300 rooms to our network in Asia Pacific by the end of 2018, the momentum has not slowed. We continue to strengthen our presence with nearly 570 hotels in the pipeline, bringing our existing count of over 710 operating hotels closer to our goal of 1,000 hotels opened by 2020. We will also expand our coverage in new destinations such as Sri Lanka. Much of this growth is fueled by the increased demand for travel by the growing middle class, particularly in China. Currently, only about seven per cent of Chinese citizens hold passports, which means there is approximately a 1.3 billion-person opportunity for future growth. Beyond that, we also see the aviation market is trending upward with China as a key contributor. Through our joint venture with Alibaba, we piloted facial recognition check-in technology last July at two Marriott International properties in China – Hangzhou Marriott Hotel Qianjiang and Sanya Marriott Hotel Dadonghai Bay. Designed to offer a convenient check-in alternative, we constantly seek innovative ways to not only elevate the travel experience for Chinese customers but also to set ourselves apart from the competition. As the marketplace evolves, we also adapt our business. Airbnb has shifted its focus to Asia Pacific as the number of bookings made on its platform from business travellers based in this region have grown five times between 2016 and 2017, exceeding the global average of 4.3 times over the same period. Given the clear appetite for homesharing and the promising results from our homesharing pilot – initiated in collaboration with Hostmaker, a London-based home rental sharing

management company – we will be adding more locations and more homes this year beyond the 340 properties we tested in London, Paris, Rome and Lisbon. Without a doubt, luxury travel is on the rise. We are on track to nearly double our current portfolio of over 120 luxury properties, with close to 100 luxury hotels on the horizon – 50 per cent of which will be in China. Recent openings include the Bvlgari Hotel Shanghai – a brand debut – and The Shanghai EDITION. We also launched our first luxury hotel, W Brisbane, in Australia in June. Later this year, Australia will welcome its first RitzCarlton Hotel in Perth as well as The Tasman, a Luxury Collection hotel – a brand debut in Tasmania – while Hong Kong will see the St. Regis enter the market. But perhaps the most important milestone of all has been the recent launch of the new name and branding of our unified loyalty program – Bonvoy. With the official debut of the new loyalty program taking place on February 13, our guests can expect access to more exclusive experiences – to be known as Marriott Bonvoy Moments – as we prepare to announce exciting marketing partnerships with iconic brands that will yield even more member benefits. Hotel expansion is not the be-all and end-all and certainly, bigger is not always better. Being the world’s largest hospitality company means nothing if we cannot balance size with consistently branded, seamless and quality experiences to our guests. Marriott returned the Four Points by Sheraton brand to Sydney in 2018

SNAPSHOT: MARRIOTT INTERNATIONAL Number of hotels & rooms (Globally): 6,700 properties and 1,299,000 rooms Number of hotels & rooms (Asia-Pacific): 710 properties and 206,000 rooms Number of hotels & rooms (Australia, New Zealand and South Pacific): 30 properties and 7,700 rooms Number of employees (Globally / APAC / ANZSP): 700,000 / 139,714 / 5,600 Year first hotel opened (Globally / APAC / ANZSP): 1957 / 1974 / 1991 Year the company was founded: 1927 Brands in the organization: 30 Head office locations (Globally / APAC / ANZSP): Bethesda, Maryland, Hong Kong (APAC), Sydney (ANZSP)

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GLOBAL LEADERS

Darren Edmonstone Chief Executive Officer, Next Hotels & Resorts

We believe that Asia Pacific will continue to be the sweet spot for the industry.

YEAR 2018 WAS a good one for travel and hospitality. International tourist arrivals increased, with estimates placing the figure for the full year at 1.4 billion and Asia Pacific posting the highest growth. This brings us closer to UNWTO’s forecast of 1.8 billion by 2030. It also supports an optimistic outlook for our industry in 2019, especially as economic indicators suggest that advanced economies will hold steady while emerging markets continue to grow. The Mastercard Global Destination Cities Index 2017 showed that Asia Pacific destinations accounted for half of the world’s top 10 most visited cities and attracted the highest visitor spend. MICE business in Asia Pacific is also growing faster than any other region and we are expecting close to 10 per cent growth over the next few years, on the back of infrastructural improvements and reduced visa red tape. To capture this growth, we plan to enhance Sage Wollongong’s offerings to make it an outstanding venue of choice that combines an authentic local experience with world-class MICE facilities. Increasingly, guests are moving away from cookie-cutter hotels and are seeking unique engagement with local products and experiences. As we expand, we will be focusing on emerging hot spots such as Sri Lanka and Vietnam. Sri Lanka’s burgeoning hospitality industry has been changing the country’s landscape and tourism’s contribution to the economy over the last few years. PATA ranks Sri Lanka 5th amongst Asia Pacific’s top destinations and Sri Lanka’s tourism industry has the backing of a government that is rolling out a ‘So Sri Lanka’ campaign to boost arrivals.

“By the end of 2019, we plan to have a pipeline of 10 Kafnu properties in Asia Pacific.” Darren Edmonstone - Chief Executive Officer, Next Hotels & Resorts

Sage

Wollongong

SNAPSHOT: NEXT STORY GROUP Number of hotels and Kafnu properties (Globally): 40 Number of hotels and Kafnu properties (Australia, New Zealand and South Pacific): 32 Number of employees (Globally / APAC / ANZSP): 405 Year the company was founded: 2009 Brands in the organisation: Kafnu, Next, Sage, LinQ, Chifley, Country Comfort and Sundowner Head office locations (Globally / APAC / ANZSP): Singapore, Sydney and Bengaluru

38 HM The Business of Accommodation

We are excited about Colombo, where we will open our first Next hotel outside of Australia in November. As a unique single offering that answers the growing demand for a base to network and do business rather than just a hotel room, Next Hotel Colombo will also house Kafnu Colombo, our fourth Kafnu property in Asia Pacific. Kafnu is a members-only club, offering the best elements of a shared workspace, boutique hotel and social community. Besides meeting like-minded individuals with an interest in co-creating, co-exploring and coinnovating, members enjoy exclusive access to activities that support personal and business ambitions. Equally important to us is the more mature market of Australia, where we have our biggest portfolio of hotels. This is a robust market where domestic tourism continues to flourish and where visitor arrivals will likely reach 10 million by 2020. That will also be the year that we will open our 255-room Next Hotel at 80 Collins Street in Melbourne, which will redefine the traditional corporate five-star hotel experience to deliver an offering that is empathetic to the evolving expectations of today’s travellers. Since we launched our innovative and engaging upper-upscale Next Hotels brand in 2014 with the opening of Next Hotel Brisbane, it has been achieving above 80 per cent occupancy year after year. We are very excited about the opening of Kafnu Alexandria in Sydney, which marks the entry of the Kafnu co-working brand into Australia. Kafnu has a unique proposition that offers more than a shared workspace, which will set it apart in the market. By the end of 2019, we plan to have a pipeline of 10 Kafnu properties in Asia Pacific. Over the past three years, shared spaces have grown exponentially. We believe that flexible work spaces will become the new must-have in property development. Demand is growing globally, nowhere more rapidly than in Asia Pacific. We are optimistic about 2019. We know where the opportunities are, we’re nimble and ready for our next phase of growth.

GLOBAL LEADERS

Jeff Wagoner

President & CEO, Outrigger Hospitality Group Fuelled by reduced barriers to international destinations, travellers flexed their globe-trotting muscles in 2018 with record strength.

HELPING THIS ALONG further was a surge in airline routes and some truly inspirational Instagram feeds. We saw this play out in the Hawaiian Islands where, despite a series of natural disturbances ranging from volcanic eruptions to hurricanes, tourism surpassed year-overyear visitation numbers. With the rise of transformative, conscious travel – our beachfront resorts in Hawaii and Asia Pacific welcomed modern travellers seeking to balance individual wellness alongside greater community purpose. Outrigger’s signature guest ‘voluntourism’ experiences range from building a pre-school in Fiji to planting coral reefs in the Maldives. We’re elated by our guests’ heightened requests for authentic cultural activities and zest for a sustainable stay. Both are central to Outrigger’s unique hospitality. New for 2019 – we have restructured our company under the umbrella of Outrigger Hospitality Group. Our objective is simple – to be The Premier Beach Resort Brand in the World. This reorganisation allows us to focus on enhancing our current, multi-branded portfolio of beach resorts, hotels and apartments, while providing structure for the strategic growth of our brand. We have the appetite and resources to grow in three distinct categories: our Premier (toes-in-the-sand) beachfront resorts; our “by Outrigger” branded hotels and third-party managed properties. Plus, impart our retail, development and management expertise. We now have 38 properties in some of the most pristine beach destinations in the world – Hawaii, Fiji, Thailand, Guam, Mauritius and the Maldives. We know beaches and we look forward to growing the Outrigger brand with more hotels and resorts along the sands. Innovation and technology continue to be vital elements sustaining the success of our business. In 2018 alone, we deployed revenue-strategy related technology such as SynXis – which transformed our distribution system – as well as Travelclick’s Demand360 and Duetto, which improved our revenue management strategy – ultimately optimising our properties’ global pricing strategy for every channel and market segment.

“New for 2019 – we have restructured our company under the umbrella of Outrigger Hospitality Group.”

As a whole – Outrigger has the technology, tools and revenue-strategy systems of the larger hospitality networks, but with the personal attention of a company that gives its heart and soul to its guests and partners alike. With strong marketing and sales forces regionwide, our team has grown to a global network of offices worldwide and works to maximise revenue opportunities and return investments for all stakeholders, while also focusing efforts with our Outrigger DISCOVERY loyalty members and Outrigger Expert Agents. Regarding development, Outrigger had a successful 2018 and particularly exceptional growth in our Asia-Pacific portfolio, which we sold this past year to Singha Estate Public Company Limited – Thailand’s premier property development holding company. While Outrigger continues to manage the six APAC properties, the deal generated USD$310 million to fund future growth and expansion of our global brand. Our development team is currently executing a Waikiki modernisation Master Plan, which includes the highly-anticipated transformation of our flagship Outrigger Reef Waikiki Beach Resort property, new food and beverage offerings and the opening of new Voyager 47 Club lounges. The plan also includes a $200 million investment in capital expenditures over the next two to three years for our core Hawaii-owned assets, offering an upgraded guest experience across the Waikiki region. Also new for 2019 is the reimagined Waikiki Beachcomber by Outrigger, our first lifestyle hotel in Outrigger’s global portfolio. The USD$35 million makeover brings a modern Waikiki vibe to the all-new guest rooms and meeting space, as well as complete modernisations to the lobby, pool deck and hotel exterior. The property is filled with authentic art and music of Hawaii, including stunning underwater photography from renowned photographer Zak Noyle. Even the inroom Japanese style yukata bathrobe feels like art. Last but certainly not least, we are excited to be exploring the sands of iconic vacation spots and make our mark in more tropical locales around the world to catapult our brand into new territories. As we continue to navigate through Outrigger Hospitality Group’s next chapter, we look forward to continuing to provide customers with next-level authenticity and the spirit of caring for the guest, host and place that is embedded into the essence of who we are, captured in what we call Ke `Ano Wa`a - translated from the Hawaiian language to mean The Outrigger Way.

SNAPSHOT: OUTRIGGER HOSPITALITY GROUP Number of hotels & rooms (Globally): 38 properties with approx 6,500 rooms Number of employees (Globally): approx 3,500 Year first hotel opened: 1947 (Hawaii) Year the company was founded: 1947 Brands in the organization: Outrigger® Resorts, Hawaii Vacation Condos by Outrigger® and OHANA Hotels by Outrigger®, Waikiki Beachcomber by Outrigger Head office location: Hawaii, USA

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GLOBAL LEADERS

Girish Jhunjhnuwala Founder & Chief Executive Officer, Ovolo Hotels

In 2019, we’ll continue to give our guests what they love from Ovolo Hotels.

REPORTS AND VIEWPOINTS on the Australian hospitality trends of 2019 speak of the modern traveller preferring a boutique, lifestyle brand of hotel. One that’s experiential and focuses on individualism, localism and art. Design is important, as well as key touch points such as high speed Wi-Fi, strategically placed power points / USBs by the bedside and tablets/voice assistants. I’m encouraged that Ovolo Hotels is ahead of these trends. This year, we launched three new Australian hotels – Ovolo Nishi in Canberra, Ovolo Inchcolm and Ovolo The Valley, the latter two in Brisbane. All of our hotels have a unique character – whether it’s the whimsical oasis of The Valley, the eclectic, sophisticated feel of Inchcolm or the city street-art vibe featured in Melbourne’s Ovolo Laneways. One of our most popular trends we aim to continue in 2019 is the Lobby/Living Space revolution. This is a concept that we’ve already installed in many of our hotels which provide welcoming, warm and friendly communal spaces with plenty of room to relax, socialise and work. I’m thrilled however, that we’ve taken that a step further by launching a new brand under the Ovolo Group – Mojo Nomad. Both Mojo Nomad micro-hotels are based in Hong Kong and allow the traveller to choose their own world. They offer a mix of private and shared rooms, communal areas and co-working spaces. They suit the digital nomad – those professionals that now work from city to city with no fixed place of residence. Due to its success in Hong Kong, we’re excited to be expanding our Mojo Nomad brand into Australia. Development of the site will begin in 2019 in Melbourne with launch expected in 2020. This is on top of our first hotel management agreement, also in Melbourne. Whilst I’m happy with the opportunities and our development in Australia and Hong Kong, 2019 will see

“Generally looking forward to the next twelve months, I’m extremely encouraged.”

SNAPSHOT: OVOLO HOTELS Number of hotels & rooms (Globally): 10 hotels, over 1,000 rooms Number of hotels & rooms (Asia-Pacific): 4 hotels, over 400 rooms Number of hotels & rooms (Australia, New Zealand and South Pacific): 6 hotels, over 600 rooms Number of employees (Globally / APAC / ANZSP): 700 Year first hotel opened (Globally / APAC / ANZSP): 2002 Year the company was founded: 2002 Brands in the organisation: Ovolo Hotels, Mojo Nomad Head office locations (Globally / APAC / ANZSP): Hong Kong and Sydney

40 HM The Business of Accommodation

us looking further afield to spread the Ovolo brand. We know that Australians feel the Ovolo vibe and I want us to go where our demographic market is going. The Aussies love the UK, the US, New Zealand and Indonesia so these are all places of interest for us. Generally looking forward to the next twelve months, I’m extremely encouraged. In Australia, room revenues for 2019 are forecast to grow by 20 per cent over the same time last year, which is higher than the Sydney forecast of 2-3 per cent and good RevPAR growth in a market which is forecasting minimal to no change. The Hong Kong market continues to grow strong, with a record number of visitors to the city in 2018 at 61 million. I’m expecting that growth to only continue. At Ovolo, our Hong Kong portfolio has undergone renovations and some repositioning over the past 18 months which will come into fruition this year. We’re looking at a 58 per cent bottom line growth in 2019 for our four Hong Kong hotels, which also includes our three restaurants – Komune at Ovolo Southside, TQM at Mojo Nomad Central and our new restaurant VEDA, the first vegetarian hotel restaurant in Hong Kong. We look forward to new growth, especially from our flagship property Ovolo Central after a full redesign, which will be launched this month. There are many factors that will contribute to our growth in 2019. Increased aviation, especially budget flights will always be a positive aspect for us, as it paves the way for increased visitors. Our lead markets of the US and UK will continue to strengthen with these more affordable and increased travel options. The new nonstop flights – such as the Perth to London route – is one example. Melbourne is also seeing new international connections, creating the perfect platform for expansion; a prediction of 9 per cent growth which is ahead of the national average of 7.5 per cent. This boosts confidence ahead of our new ventures in the city. A strong factor affecting growth will always be currency. The fall of the Australian dollar gives some leverage for us to ramp up the pace. Those outside of Australia can get more for their cash and will be attracted to holidaying in the country, whereas Australians are more likely to stay close to home and visit other Australian cities instead. The last 12 months have been a busy, productive year and economic growth is generally forecasted to continue at a healthy level in 2019. I look forward to consolidating our portfolio’s performance and drive demand, given the newly acquired assets and refurbishments.

GLOBAL LEADERS

Lothar Nessmann

Chief Executive Officer, Pan Pacific Hotels Group The general outlook for 2019 is slightly more overcast compared to previous years, with financial conditions tightening and global growth slowing down.

COMPANIES ARE CURRENTLY more cautious towards

spending, which means potentially less demand for inbound business events. However, there is a silver lining in the clouds as the longer-term outlook is more positive, with business travel-related spending increasing by 7.1 per cent in 2018 over 2017 and forecast to grow further to USD$1.7 trillion by 2020/21. This year will also see more ‘Bleisure’ travel across all regions worldwide, particularly for top destinations such as Singapore, Hong Kong, Tokyo and Shanghai. Experiential travel – the catch phrase over the last two years – will still be buzzing into 2019 as people seek to be inspired and transformed by travel. Aided by travel apps and sharing platforms, solo trips are on the rise, especially for female travellers, who will be looking for accommodation which cater to their needs and understand their concerns especially about safety. “Single-use” was the buzzword for 2018 (and Collins Word of the Year) as the global campaign to reduce the use of single-use plastics gained momentum around the world. With public awareness at an all-time high, we will see less plastic cutlery and wrappings from hotels, restaurants and cruise ships. We’ll eliminate single-use plastics at all our hotels by end of this year. Operating with integrity is part of our ethos, and we’ve gone beyond adopting green practices to building and operating sustainable hotels. Building on the success of PARKROYAL on Pickering, the world’s first hotel-ina-garden, we will be launching Pan Pacific Orchard in 2021. Green Mark Platinum-certified PARKROYAL on Kitchener Road will soon offer a drinking water filtration system in each guestroom which eliminates the use of bottled water in the hotel. Generally, it has been a very eventful year to say the least! Building on a foundation of “trust”, we refreshed our vision, purpose and values, and rejuvenated our service culture to put our guests, partners and people at the heart of all that we do. New brand strategies and identities were rolled out globally for Pan Pacific Hotels

Group and our Pan Pacific and PARKROYAL brands. We strengthened our operations and service standards. To bolster and expand our marketing channels, we consolidated three separate websites into a single brand website and enhanced the user functionality. We rebranded our guest loyalty programme to Pan Pacific DISCOVERY. Further, we became a shareholder of the Global Hotel Alliance, the world’s largest alliance of independent hotel brands which brings together more than 550 hotels. Pan Pacific Melbourne went through a comprehensive facelift for all 396 guestrooms. The main Lobby, Lobby Lounge and Reception as well as the Club Lounge were completely refurbished. On the other coast of Australia, Pan Pacific Perth introduced three new culinary concepts. We opened Restaurant Uma and Bar Uma in collaboration with award-winning Executive Chef Alejandro Saravia, focusing on Peruvian cuisine and cocktails which use local produce, as well as Hill Street Bar, which specialises in Western Australia beers! As part of our brand refresh, one of our priorities was to ensure our brand website is optimised to offer a seamless experience across desktop and mobile, and to make the booking process as quick and easy as possible. On this, we have managed to set an industry standard with a simple three-step booking process. Speed is of the essence as half of travellers will switch sites or apps if it takes too long for them to get the information they want.

PARKROYAL on Pickering is a hotel in a garden!

SNAPSHOT: PAN PACIFIC HOTELS GROUP Number of hotels & rooms (Globally): 42 hotels / 12,338 rooms Number of hotels & rooms (Asia-Pacific): 37 hotels / 11,241 rooms Number of hotels & rooms (Australia, New Zealand and South Pacific): 5 hotels / 1,784 rooms Number of employees (Globally / APAC / ANZSP): 6,012 Year first hotel opened (Globally / APAC / ANZSP): 1971 Year the company was founded: 1968 Brands in the organisation: Pan Pacific Hotels and Resorts; PARKROYAL Hotels & Resorts Head office locations (Globally / APAC / ANZSP): Singapore (global)

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FEATURE/NEWS

Swiss-Belsuites Pounamou, Queenstown

e Yo

ney rk by Syd Swiss-Belhotel,

CHINA AND INDIA are both continuing remarkable growth stories, with other emerging economies seeing impressive growth as well. The United States economy has been slowly strengthening for some time and is expected to benefit from an extra short-term boost from tax cuts. European markets – including the UK and continental Europe – are looking healthy as well. The rebound in the Australian dollar witnessed over the last year – which has seen it climb back toward 80

cents against the USD – is expected to be temporary as interest rate increases in the US push the USD higher. As expected, oil prices are rising from their record lows. While further increases are anticipated over the next three years, the price of crude oil is not projected to return to the high prices at the beginning of the decade. The picture remains remarkably friendly for economic growth – globally and here at home – which sets the scene for ongoing growth of Australia’s tourism industry. Over the next three years, Australia’s economy is expected to grow at around three per cent per annum, with the Northern Territory and Queensland fastest at 3.4 per cent), followed by Victoria and New South Wales. Business travel has grown exponentially in the recent years, and along with it is the increase in number and size of corporate meetings and events. This has become a huge opportunity for event planners, hotels, and event spaces. Meetings and events demand is expected to rise by 5-10 per cent in 2019 and the average size of meetings will also increase. These are the critical findings of the 2019 Meetings & Events Future Trends report. Along with the increase in the number of attendees is

Gavin Faull

Chairman & President, Swiss-Belhotel International Global economic growth is the most geographically balanced it has been in a decade.

“Higher regulations make hotels more reliable and safer.”

SNAPSHOT: SWISS-BELHOTEL INTERNATIONAL Current number of hotels & rooms (Globally): 79 operating hotels Current number of hotels & rooms (Asia-Pacific): 79 operating hotels Current number of hotels & rooms (Australia, New Zealand and South Pacific): 5 operating hotels / 488 rooms Current employee count (Globally / APAC / ANZSP): 9,110 Year first hotel opened (Globally / APAC / ANZSP): 1991 Year the company was founded: 1987 Brands in the organisation: Grand Swiss-Belhotel, Grand Swiss-Belresort, Swiss-Belhotel, Swiss-Belresort, Swiss-Belboutique, Swiss-Belsuites, SwissBelvillas, Swiss-Belresidences, Swiss-Belinn, Swiss-Belcourt, Swiss-Belexpress, Zest Plus Hotel, Zest Hotel and Zest OK Hotel. Head office locations (Globally / APAC / ANZSP): Hong Kong, Shanghai, Jakarta, Surabaya, Hanoi, Sydney, Auckland, Dubai, Athens

42 HM The Business of Accommodation

the hike in budget for MICE. Of those polled in research by CVent, 52 per cent said their budget had increased in 2018. Despite the bigger budget, event planners are still looking for ways to cut corners and make events super lean. With an influx of new players in the hospitality sphere – especially in the peer-to-peer accommodation market – it is essential that hotels reinforce their competitive advantages. Services such as Airbnb continue to grow every day, as they can be, in most cases, cheaper than hotels and with a different cultural exposure. But what do hotels have that Airbnb can’t offer? Amenities – although there are differences between hotels, they can include Wi-Fi, housekeeping, restaurants and room services, in-room toiletries, among others. Consistency – customers know exactly what to expect when they walk into a hotel room, which offers a different, and consistent experience. Data collection – CRM and analytics allow for an indepth understanding of the customers, which can help to improve the service. Meals – from breakfast to dinner or room service, having easy access to food can make a hotel stay a lot more pleasant. Sophisticated level of service – hotels offer much better service with hospitality professionals at another level. Just as an example: there is usually a 24/7 reception, where you can easily check-in at any time. Trust and safety – higher regulations make hotels more reliable and safer. Customer expectations are increasingly demanding, so it is crucial that companies focus on their total satisfaction, positive feedback and repeated purchases. Some of the services required in the hotel industry are highly personalised, so it is necessary to devote more time to guests and optimise operations within every team. This will allow for a higher rate of staff retention, as they can have a more organised work schedule and a better quality of life.

GLOBAL LEADERS

Joon Aun Ooi

President & Managing Director, Wyndham Hotels & Resorts, Southeast Asia and Pacific Rim Wyndham Hotels & Resorts has a strong focus on the Asia Pacific region which will see tremendous growth over the next decade.

IT IS NOW six months since we celebrated the spin-off from Wyndham Worldwide, launching Wyndham Hotels & Resorts as a pure-play hotel company that is strongly positioned for growth and making hotel travel possible for all. We are well-positioned to capitalise on the region’s impressive growth and economic prosperity and within the next five years, we are aiming to more than double our regional footprint. Globally, Wyndham Hotels & Resorts continues to expand, with an average of two hotels opening every day. Within South East Asia and the Pacific Rim, we have built up a significant regional portfolio and pipeline of new properties in key markets such as Korea, Vietnam, Malaysia, Thailand and Indonesia. Last year, we introduced the Days Hotel & Suites brand to Malaysia’s capital city, Kuala Lumpur, as well as the Wyndham Grand to Yangon, Myanmar. We will also open a Wyndham Garden in Vietnam’s capital, Hanoi, in the first quarter of 2019. We will continue to be focused on our growth in emerging destinations like Vietnam, where almost 10,000 new hotel rooms will be opened across the country in the next five years. Elsewhere in the region, we have launched the Ramada brand in Fiji and Wyndham Garden brand in New Zealand. We have also signed hotels under our Wyndham and Ramada brand in Palau and Vietnam, including projects in Halong Bay and the Ho Tram Strip. And our midscale brand, Ramada Encore by Wyndham, has taken a new direction complete with a redesigned logo, a new room concept and reimagined multi-functional common areas all catering to the modern traveller. The expansion of regional air travel is driving significant growth across the region. Passenger traffic to, from or within Asia Pacific is expected to grow by 72 per cent to 3.1 billion by 2035, with low-cost carriers contributing significantly to this growth. Wyndham

“Globally, Wyndham Hotels & Resorts continues to expand, with an average of two hotels opening every day.”

Hotels & Resorts is well-positioned in this market with a strong presence in the region’s key destinations. We currently have nine brands represented across 15 countries in the SEAPR region and will continue to introduce new brands and locations to cater for the fresh influx of middle-class travellers. Of course, the emerging middle-class will provide huge opportunities for hoteliers, especially in Asia, which will account for around 90 per cent of the world’s next billion middle-class citizens. Wyndham’s diverse portfolio of hotels will provide a variety of options for travellers to enjoy new experiences. The hotel industry is constantly evolving, and it is an exciting time to be part of a dynamic era of accommodation growth and change. Disruptors are a natural part of this evolution but at Wyndham, we believe the best way to encourage brand loyalty is by ensuring we deliver great service for every guest, every time. This is backed by a strong guest loyalty program, and Wyndham Rewards is one of the best in the industry. We understand that travellers want to feel rewarded, and Wyndham Rewards makes it easy for guests to receive what they want most – a free night at the world’s largest global collection of participating hotels. Wyndham Rewards has been programmed to be simple-to-use, offers generous earnings and has a simple, flat redemption structure with great value and no blackout dates. MICE is a vital part of the hospitality industry but, like everything else, is undergoing a period of change, with the traditional events and meetings offering now being eschewed in favour of more unique experiences and activities. As the preferences and needs of business travellers evolve, we are constantly evaluating our current offerings to anticipate their changing preferences, so we can make each guest’s stay with us special and enjoyable. Overall, 2019 is looking very positive for Wyndham Hotels & Resorts, with new brands in emerging and existing destinations, and continued growth of our established brands with a significant focus on the Asia Pacific region.

SNAPSHOT: WYNDHAM HOTELS & RESORTS Number of hotels & rooms (Globally): Nearly 9,000 hotels and 798,300 rooms Number of hotels & rooms (Asia-Pacific): More than 1,500 hotels and approx. 163,100 rooms Number of hotels & rooms (Australia, New Zealand and South Pacific): 43 hotels and more than 4,000 rooms Number of employees (Globally): 16,000+ Year the company was founded: June 2018 Brands in the organisation: The Trademark Hotel Collection®, Dolce Hotels and Resorts®, Wyndham Grand®, Dazzler® Hotels, Esplendor® Boutique Hotels, Wyndham Hotels and Resorts®, Wyndham Garden® Hotels, TRYP by Wyndham®, Wingate by Wyndham®, Hawthorn Suites by Wyndham®, Microtel Inn & Suites by Wyndham®, Ramada®, Baymont Inn & Suites®, Days Inn®, Super 8®, Howard Johnson®, Travelodge®, La Quinta, Americinn, Ramada Encore Head office locations (Globally / APAC / ANZSP): Parsippany, NJ; Buenos Aires, Argentina; London, England; Singapore and Shanghai, China

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GLOBAL LEADERS

ownership resorts, more than 4,300 affiliated exchange properties and close to 900,000 owners of vacation ownership interests. Our vacation exchange division, RCI is also the largest in the world with 3.9 million members. We’ve developed a strong reputation for offering the world’s best and most varied vacation club experiences, which has enabled us to continually expand and develop our offerings. New Zealand yields are still strong, although the property market has softened. In Australia, Melbourne is showing signs of softening and yield in Brisbane has weakened, but tourism destinations such as Port Douglas and the Gold Coast continue to perform well. Other emerging growth markets we have identified include areas in India, South America, Africa and the Middle East. Parts of Europe also still offer attractive purchases. Wyndham Hotel Melbourne is a prime example The biggest challenge for the industry at present is readiness for the of how the mixed-use model can benefit all parties. unknown. Whether it be tsunamis, earthquakes, ash clouds or political This location includes hotel accommodation, vacation crises, the greatest concern is how to plan for the unforeseen. ownership, residential and retail space. Ramada Dinner Plain in Victoria’s Mt Hotham is another example. We acquired the former Peppers IN TODAY’S WORLD, we need agile teams, because Rundells Alpine Lodge – comprising the hotel and 30 when it comes to dealing with the unexpected, whoever chalets in Dinner Plain village – in 2016 to operate as reacts the quickest will come out on top. a mixed-use resort for the use of timeshare owners n a c e d r n Reso Su rt L ham We have seen how fickle the industry can be when and hotel guests. Since rebranding, the resort’s d o m yn bo W it comes to crises. Last year’s boat tragedy off the occupancy rates have climbed, hitting 81.4 coast of Phuket resulted in the deaths of 47 per cent at the peak of the ski season in July Chinese nationals. With tourists from China 2017 compared to a high of 58 per cent the making up almost a quarter of Thailand’s 35 previous year. In what was traditionally million visitors, this was a major blow. The its quietest time last year, occupancy tragedy saw the number of Chinese tour reached 50 per cent, a vast improvement groups drop significantly by 50 -70 per cent compared to the same period in 2015 from the same period in the previous year. when the resort would only open for Natural disasters have been a challenge occasional group bookings. for Indonesia. Multiple volcanic eruptions of Wyndham Destinations is excited to see Mount Agung in 2017 and 2018 led to a sharp the strong growth it is expectng in 2019. drop in the number of visitors to Bali from China and elsewhere. In the months following Lombok’s SNAPSHOT: WYNDHAM DESTINATIONS 2018 earthquake, what was usually high season resulted in less than 40 per cent of guest rooms occupied. Number of hotels & rooms (globally): More than 220 vacation club resorts, The desires of developers and property owners is to 4,300 affiliated resorts in 110 countries and 10,000 professionally managed minimise their risks and maximise capital returns. With vacation rental properties across North America this in mind, Wyndham’s vacation ownership products Number of hotels & rooms (South East Asia and South Pacific): More than – if used in conjunction with a hotel – are extremely 45 hotels and resorts, over 3,500 rooms viable and present tremendous benefits to developers in Number of employees globally: over 25,000 / 4,000 (APAC) creating multiple revenue streams. When you run a hotel Year the company was founded: Wyndham Destinations – 2018 that accommodates both vacation ownership owners Wyndham Destinations Asia Pacific (Formerly Wyndham Vacation and hotel guests, it provides a constant boost to food and Clubs Asia Pacific) 2000 beverage and retail outlets. With high occupancy rates Brands in the organisation: Club Wyndham, Club Wyndham Asia, Wyndham of 86 per cent plus across the board from the vacation Club Brasil, Margaritaville Vacation Club, Shell Vacations Club, WorldMark by ownership model – compared with average Asia Pacific Wyndham, WorldMark South Pacific Club by Wyndham, RCI, DAE, Love Home hotel occupancy rates of 70.9 percent – the hotel owner Swap, The Registry Collection, TripBeat Endless Vacation, RMED Forces Vacation benefits, the restaurants and bars benefit and Wyndham Club, Wyndham Vacation Rentals, Oceana Resorts, Resort Quest, Resort Quest as an equity player benefits. Whistler, Kaiser Realty, Smoky Mountains Property Management, Hatteras Realty Wyndham Destinations was established in June last Vacation Palm Springs, Corolla Classic Vacations. year following the spinoff of Wyndham Hotels & Resorts Head office locations (Globally / APAC / ANZSP): Orlando Florida, USA (global), from Wyndham Worldwide. We have a global presence Gold Coast, Australia; Singapore; Shanghai, China; Clark, Philippines. (APAC) in 110 countries, comprising more than 220 vacation

Barry Robinson

President & Managing Director, International Operations, Wyndham Destinations

44 HM The Business of Accommodation

LEADING SUPPLIERS

Peter Deveny

Group Manager Commercial, A.H. Beard This year promises to be exciting for us all at A.H. Beard as we mark 120 years of operation.

IN LINE WITH a major upcoming anniversary, we are planning a range of opportunities across the year for our customers and their guests to be part of our celebrations. One of the keys to A.H. Beard’s longevity and sustained growth is clearly our commitment to providing the highest possible quality of both product and service to our customers. Most of the customers that we deal with say that they are drawn to A.H. Beard not just because of our reputation for quality products, but also because of the feedback from past and current customers about the way we deal with them. Aside from the birthday celebrations, the outlook for 2019 is a positive one. The number of new hotel developments continues to be strong, stimulating plenty of refurbishment and new approach to design and functionality in existing properties. The global operators looking to expand their presence in our market – bringing fresh new brands and guests – will continue to drive excitement and hopefully open the Australasian market to further growth. And as we grow our appeal to those international guests, more than ever, these guests are demanding higher standards and better product to justify spending their tourist dollars here. Just as hotel and resort operators and owners face challenges to retain guests and attract new ones, and due to the prominence of OTAs and other disruptors to the market, the pressure is certainly on industry suppliers to be at their best. As a leading supplier to the hospitality market across our region, the challenges posed by the consolidation and merging of some of the biggest hotel groups in the region, and globally, are things of which we are very conscious. It is critical to our ongoing growth and success that we continue to focus on innovation, technology and sleep health as we continue to lead the market. Our investment in innovation and sleep science is second to none in the industry. We partner with leading sleep science practitioners and organisations to lead development of products which provide healthy,

comfortable and in some cases life-changing quality of sleep to our customers and their guests. There is no question that the quality and health of our sleep is now a prominent factor of discussion, not only in terms of its impact on health, well-being and quality of life, but also as a key influencer of productivity and performance in the OH&S sphere. We see this continuing to grow in prominence and to become more of a key factor in where corporate businesses choose to place their employees. Factors high in the corporate consideration are employee performance, satisfaction and retention and also the cost of absenteeism and rehabilitation when employees are impacted by health conditions linked to the quality of sleep when they are on company business. One thing that we certainly see continuing is the growing awareness of the difference a good bed makes to the guest experience and the all-important feedback on social media and other review platforms. More than ever, we are being asked to explain the benefits of more technologically advanced spring and comfort systems and what they will mean to the guest in both the short and long term. Savvy operators are now very conscious of the cost of a decision made purely on cost. One thing I am really excited to watch develop over the coming year is our ability to offer properties an innovative way to purchase their beds. This is based around leasing, rather than purchasing them outright up front, vastly reducing the initial capital outlay and giving operators the ability to instantly improve the appeal of their rooms and subsequently improve their room rates. This is something that is second nature to most businesses. They lease their motor vehicles, office and IT hardware and other operating equipment and now have the ability to do this with virtually their entire room fitout. The finance facility is provided by one of the world’s largest financiers, which provide this type of model to some of the world’s leading businesses. The approval process is also relatively simple and quick. I can see this transforming a significant part of the market and giving many businesses the ability to improve the quality of their rooms in a very fast and effective way, with minimal impact on cash reserves. It also means that the difference between purchasing a relatively basic model and one that offers far more comfort and technology is literally a few cents a day! You’ll be seeing more about this from us over the coming months, but the facility is available immediately, so ask any of our Sales team for more information.

“One thing we see continuing is the growing awareness of the difference a good bed makes to the guest experience and the all-important feedback.” Peter Deveny – Group Manager Commercial, A.H. Beard hotelmanagement.com.au 45

LEADING SUPPLIERS

Michael Benikos Sales Director, Oceania, Assa Abloy Global Solutions Innovation and evolution remain central to the security industry in 2019 and beyond.

WITH CONSUMER BEHAVIOUR and preferences constantly shifting and new security threats continuing to surface, the security industry has continued to evolve its practices and offerings in order to fully meet the industryâ&#x20AC;&#x2122;s latest challenges. In recent years, for instance, hospitality markets around the world have seized on the opportunity to implement advanced online door lock functionality, due to the considerable advantages in enhanced property safety and guest convenience that such solutions uniquely provide. Benefits including the ability to remotely monitor door access attempts and instantly cancel keycard credentials have crucially provided hoteliers with the tools needed to ensure guest safety in a world where security threats can surface in a matter of moments. With todayâ&#x20AC;&#x2122;s hotel guests seeking ever-faster and more convenient service, online locks have experienced widespread adoption rates, due to features such as the ability to remotely reassign guests to a new room or extend their stay without the need to visit the front desk for a new key. As we enter a new year, such technology will only become more commonplace, with companies such as ASSA ABLOY Global Solutions entering into agreements with wireless network providers, ensuring the ability for hoteliers to seamlessly integrate and manage online lock functionality with pre-existing networks and IoT devices. More hoteliers are integrating mobile access technology into existing property apps and in turn, more guests are recognising mobile access as a valuable, expected service. Yet another functionality being innovated by ASSA ABLOY Global Solutions is its Bluvision geolocation-based tracking technology. A solution which uses BLE beacons to track the location of inventory and personnel, Bluvision is set to provide hoteliers with even greater control over their operations, and like cloud-based access management, is set to become a defining factor in how the security industry continues to evolve in 2019.

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46â&#x20AC;&#x192;HM The Business of Accommodation

LEADING SUPPLIERS

Kylie Maxwell

Executive General Manager, AHS Hospitality Our partnerships continue to grow in Australia with all the major hotel brands and will continue to do so as the “hotel boom” continues in 2019.

hospitality

IN 2018, AHS has seen continued growth with new business throughout Australia and New Zealand, as our expansion in both the North and South Islands remains strong. There are currently 272 hotels in the development pipeline for openings between 2019-2025. The hotel boom is being driven by international and domestic hotel groups launching new boutique brands and innovative “lifestyle” concepts. Occupancy levels throughout Australia in 2019 will remain at about 80 per cent, in line with 2018 occupancies. Most major cities are continuing to see an increase in both international and domestic markets, with Hobart being one of the strongest growth locations nationally. Sydney continues to benefit from cruise ship arrivals (390+ throughout the year) causing a spike in occupancies and an increase in ADR. Along with quality and financial efficiency, compliance continues to be one of the major factors our clients consider when partnering with us. In line with the importance we place on compliance, in 2019 AHS will introduce a bio-metric time and attendance system into all hotel sites that will enable real time monitoring of employee movements, as well as automatic payment and reporting in to our payroll system. As the hospitality industry faces ongoing challenges with the current labour market, AHS shares those same challenges. AHS is looking to partner directly with Hotel Management schools in Nepal, India and China whereby students will do six-month placements with AHS as part of their Hotel Management course. The placements will give students the opportunity for permanent employment in a hotel whilst gaining valuable and practical experience specifically in housekeeping. Discussions are taking place and we are very excited about the opportunities we may be able to provide to these international students. With the current “hotel boom” upon us, there are many more opportunities for hotels to partner with AHS – the leading provider of outsourced hospitality services to the hotel industry in Australia and New Zealand.

IN AN INDUSTRY as dynamic and diverse as hospitality, Higher Education institutions must take a close look at new trends and changes in the industry to adapt their curriculum and teaching methodologies to ensure they are designed to equip graduates with the relevant knowledge that will help them advance their careers. This year, some of these may include: Upskilling and reskilling – As discussed in previous years, the World Travel & Tourism Council (WTTC) expects the travel and tourism sector to experience some difficulties in providing enough qualified professionals for the forecasted 80 million new jobs created over the next 10 years, especially in emerging destinations, where a lack of talent limits growth of the continuous developing tourism trade. Our curriculum design process, in collaboration with Industry – such as our Diploma of Travel and Tourism in partnership with Flight Centre – allows us to support new learning opportunities for students in hospitality and help develop local talents. After only one year, over 500 students have enrolled in this new blended program. Another major challenge in addressing the hospitality skills gap is traditionally a shortage of executive management skills, high turnover and movement of staff in the sector. This is due mainly to increasing global job opportunities. In response, HR business partners within the hospitality sector need to design a strategic, innovative approach. To help equip future Hospitality leaders within the industry, we have designed a suite of flexible modular courses that can be stacked up and lead to an MBA in International Hotel Leadership. Those courses are designed as project based learning and are now available online, accessible anywhere and anytime. Innovation technology and the digital advantage – The hospitality and hotel

industries are undergoing fundamental changes as new services deeply influence consumer behaviour. Many disruptions driven by technological advancements such as big data, AI and VR have allowed providers to aggregate lodging options. Additionally, shared economy and app-based innovations for peer-to-peer services to soar. Airbnb and online travel agencies of course come to mind. It is our mandate to ensure graduates are skilled in all aspects of hospitality to meet the industry’s hiring needs and get a head start when joining the professional world.

Jerome Casteigt General Manager Business and Hospitality, Laureate Australia and New Zealand, Torrens University Australia

In 2019, several exciting predicted trends are impacting the curriculum of The Blue Mountains International Hotel Management School (BMIHMS).

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LEADING SUPPLIERS

NATURALLY, UNIFORMS PLAY a hugely important role in defining a brand. What does your uniform say about your hotel? Does it say that the management have made considered choices in every aspect of the guest experience? Or have they just settled for off the shelf solutions? We are seeing a definite trend towards making a statement through uniform designs that straddle the line between retail fashion and everyday wearability. During 2018, we were lucky to work with several forward-thinking hoteliers who challenged Dallen to create very memorable looks, with some key properties enlisting our special brand of sartorial attention. Close collaborations with passionate hotel General Managers also provided a platform for sharing creative ideas & concepts, allowing boundaries to be pushed and resulting in some truly stunning outcomes. Brisbane’s new W Hotel offered the opportunity for our designers to let their collective hair down and interpret the key values of what makes W tick: glamorous, eclectic and just plain fun. Porters and valets set the tone on arrival, wearing a distinctively covetable bomber jacket, while bar hostesses in the Living Room wear elegant black jumpsuits. Finally, the Wet Deck staff make a splash in hot pink playsuits for girls with the guys in bright aqua shirts. A standout? Yes. Do the staff love wearing it? Absolutely! Over at the W’s sister property, the Westin Brisbane, our team developed a suite of uniforms which reflect the hotel’s wellness theme. The star fabric here is a lightweight breathable wool seersucker – usually found in high-end Italian fashion collections – which is both relaxed and elegant. Across the Brisbane River, the new Emporium Hotel is bringing their own brand of sophistication with a Queensland take on traditional hotel luxury style. At opposite ends of the accommodation spectrum here in Sydney, we assisted the Sheraton Grand Sydney Hyde Park to reimagine what five-star luxury means and had loads of fun working with the 8Hotels team on a very “loungy” look for their Little Albion guest house. Bespoke uniforms are essential for design-driven hotels, since they have a distinct story to tell and attract experienced travellers. Yet all hotels can achieve a designer look which is well within their reach. Our design philosophy is to create a core group of garments from which many different departments can draw and tailor a look that will work in their environment by adding accessories for wow factor. This addresses the important requirement for brand standard uniformity while also providing a degree of individuality, so staff can dress to suit their personality. We urge hoteliers to consider that “first impression”. As long as hotels continue to inspire us with innovative interior design and clever branding ideas, we will continue to make beautiful uniforms with a fresh design perspective and attention to detail. 48 HM The Business of Accommodation

Paul Fitzpatrick

Chief Executive Officer, Dallen Design We all understand that in the hospitality and accommodation industry, first impressions count.

“Bespoke uniforms are essential for designdriven hotels, since they have a distinct story to tell.” Paul Fitzpatrick - Chief Executive Officer, Dallen Design

LEADING SUPPLIERS

David Elia

Chief Executive Officer, Hostplus Every seventies and eighties Aussie child with migrant parents tells the same ‘embarrassing lunchbox story’. How the focaccia or bahn mi – or, in my case, the falafel – singled them out in the playground.

I REMEMBER THE other kids turning their noses up and insisting that my tabbouleh, fatteh and hummus smelled funny. All I ever wanted was a jam sandwich like the other kids, but MaMa thought that was like eating cake. Australia has come a long way in the past thirty or so years. Lunch boxes are now as varied as the food we eat at home. From katsu and kimchi to kefir and kakas, what was once ‘foreign food’ is now just the way we eat around here. No doubt we’ll continue to blend, mash and merge cuisines to forge the next evolution of Australian cuisine, just like we’ve advanced the styles and experiences in our world-class pubs and hotels over the past three decades. Like the hospitality scene in Australia, Hostplus has also evolved significantly over the past 30 years from when we were established in 1988 by the Australian Hotels Association and United Voice. Today, as the industry superannuation fund for hospitality, tourism, recreation and sport, we proudly serve over 1.1 million members and 158,000 employers, with $37 billion invested on their behalf. Similar to kids’ lunchboxes, or the brewing list of craft beers on tap today, Hostplus now also offers a full menu of investment products and service for members to choose from. However, it is our default Balanced option, in which most of our members are invested, that very much remains our bread and butter today. While some things have changed, others have not. Certainly, our underlying core attributes of being an industry superannuation fund will forever be instilled in Hostplus’ culture, where we are driven to put our members first – always. As a not-for-profit operation, this means all profits from our investments flow back to members, and we have always consciously rejected sales commissions and incentives to financial planners. The last 12 months has certainly been a challenging period for corporate Australia, particularly within the financial services sector. There is a sense in the community that some organisations have lost or

damaged their social licence to operate by acting unlawfully or unethically. Unfortunately, the rules that govern markets and individual companies do not always prioritise the best interests of long-term investors. We face an ongoing battle to ensure companies balance the needs of their customers and shareholders while remaining focused on the long-term. Amid the disharmony, Hostplus’ focus on putting members first and delivering sustainable investment returns has resonated strongly. In 2019, we will continue to be led by our profit-to-member philosophy and support Australia’s hospitality and tourism industries. Through the market bulls and bears over the past 30 years, we are incredibly proud to have provided leading investment returns to our members over the short and long-term. We are privileged to have partnered with amazing employers, associations and not-for-profits throughout the hospitality and tourism industries. In 2018, Hostplus held numerous investment forums, financial planning symposiums, HR seminars, member education workshops and business conferences around the country. These important activities help our members understand and maximise their superannuation, as well as raise awareness of Hostplus as a fund they can take with them throughout their career. We also continued our support towards the recognition, celebration and professional development of emerging industry stars. Last year, we were excited to announce Kay-Lene Tan – the head pastry chef at Tonka and Coda restaurants – as winner of the 2018 Hostplus Hospitality Scholarship through our partnership with the Melbourne Food and Wine Festival. This scholarship sits alongside other membership grants with the William Angliss Institute and the International College of Management, Sydney. The hospitality commemorations also continued across various industry awards for excellence, including with the Australian Hotels Association and Restaurant and Catering. These awards provide highly deserved recognition to restauranteurs, caterers, baristas, sommeliers, bar and front-of-house staff who excel in their field. They also contribute towards promoting hospitality as a rewarding, exciting and life-long career. The last financial year produced another tremendous set of results for our members. We are proud of our 30year heritage, leading investment performance, funds under management growth and strong membership base which continues to set us apart from our peers. And we will continue to work hard to keep this momentum going.

“The last 12 months has certainly been a challenging period for corporate Australia, particularly within the financial services sector.” David Elia - Chief Executive Officer, Hostplus hotelmanagement.com.au 49

LEADING SUPPLIERS

Brendan O’Farrell

Chief Executive Officer, Intrust Super To say 2018 was an eventful year for the superannuation industry would be an understatement. Despite a number of government and industry reviews, the superannuation system continued to deliver strong outcomes for members.

FROM THE PRODUCTIVITY Commission Review into the efficiency of the industry to the Insurance in Superannuation Working Group (ISWG) review of default insurance and the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services industry, it would be fair to say the super industry was under the microscope in 2018. Intrust Super’s Balanced option returned an impressive 10.39 per cent in the financial year to 30 June 2018. This figure represents the fifth year out of six that the Fund has delivered double-digit returns and the ninth consecutive year of positive returns since the GFC. Additionally, we were proud to be able to reduce insurance premiums for our members without any change to their current benefits. We introduced several new services to improve the member experience, including our Intrust Super Rewards program. Very soon, we will launch two new innovations. The first is Super Blueprint. This is an online financial advice tool that provides tailored advice much more efficiently than our current system. The second is SuperCents, our new app to help Australians grow their super without having to think about it. Intrust is always very proud when we receive awards. What’s most important about these awards and nominations is that our members can be confident their retirement savings are being managed by the fund that best suits their needs. For example, in 2017/18 we worked hard at negotiating with our insurance underwriters to reduce the premiums for our life insurance, total and permanent disability cover and income protection offerings. We were able to do so without any change to the benefits our members received. This included providing cover for up to 90 per cent of our members’ income if they were unable to work due to illness or injury. We also ensured the conditions continued to provide cover for not only full-time workers, but also the part-time and causal workers who are a major part of the hospitality industry. 50 HM The Business of Accommodation

These are just some of the reasons we won Money Magazine’s ‘Best Value Insurance in Super’ award for six years running, from 2013 through to 2018. Our investments also performed very well, which led to Intrust Super being a finalist in nine Selecting Super categories and a Platinum Rating from SuperRatings for the 12th consecutive year. Service is always our first priority. It’s one of the Fund’s core corporate values. Our members are at the heart of everything we do – so we provide them with personalised service wherever we can. No one should need to wait in a call centre queue. Our members all have a personal account manager they can contact directly. Our business partners can contact their Relationship Manager should they require assistance. No matter how it’s needed, help is always available at Intrust Super. Innovation is another critical element that distinguishes Intrust Super. Technology is always changing, and in this industry it’s important to keep our finger on the pulse. In 2018, we provided our members

with new tools to consolidate their super more easily. Through innovative new products and services, we can continue to make super easier for our members and business partners. Trust is absolutely critical. Superannuation is a long-term investment. Our members have to trust us, potentially for decades, to deliver them with financial stability in retirement. We don’t take that responsibility lightly. Trustworthiness is embedded into the staff culture at Intrust Super – we actually workshop and internally score ourselves on it as part of our corporate development. Integrity is another of our corporate values. Running a super fund means looking after those who have entrusted their futures with us. We have seen recently through the Royal Commission that sometimes people don’t do the right thing for their customers. Intrust Super will always do the best thing for our members. We have seen a turn in the markets recently that have impacted super returns. It has been quite a volatile market landscape the last few years, due to the change in direction from China, the vote for Brexit and the appointment of the Trump Administration in the United States. There is also some talk about the possibility of a domestic recession with the property market slowing down in New South Wales and Victoria. These developments do occur from time to time. The important thing is to diversify your investments and keep in mind, when prices are low, your contributions can go further.

“Service is always our first priority. It’s one of the Fund’s core corporate values. Our members are at the heart of everything we do.” Brendan O’Farrell - Chief Executive Officer, Intrust Super

LEADING SUPPLIERS

Melissa Starbuck

Commercial Key Account Manager, Sealy of Australia I think there are three words to describe our outlook in 2019. The Sealy Commercial Team is energised, committed and galvanised.

“Every Sealy bed manufactured in Australia has a spring unit which was built in Brisbane.” Melissa Starbuck – Commercial Key Account Manager, Sealy of Australia THE GENERAL FEELING in the marketplace is highly dynamic, with all states seeing a dramatic expansion of new and existing hospitality properties and precincts literally transforming and redefining our cityscapes. Not confined to CBD locations, an estimated 220 new or refurbished hotels are planned for openings in the Australian marketplace over the next decade. New hospitality concepts, boutique, business and mixeduse developments continue to make their mark as both international and local brands expand their portfolios. So why energised, committed and galvanised? Simply put, this dynamic and ever-more sophisticated marketplace means we need to grow and change as our customers grow and change. And that’s exciting! As global brands evolve organically, their requirements and continuity of product across the world becomes both universal and unique. Supporting our customers means we need to be the expert in our field as well as adaptable and agile. Our focus is developing innovative, engineered quality product, with sustainability being paramount, whilst delivering on a promise of beautifully comfortable, durable beds and reliable, dependable service. Resultantly, we’ve invested and grown our team across Australia to ensure we have the capacity to deliver with excellence. With some old and new heads offering experience and enthusiasm, our commitment to our clients and their guests is paramount. In addition, we have great relationships with our Sealy teams across Asia Pacific, and increasingly across the globe, to ensure we are professional, transparent and timely. An Australian family-owned and operated business which began in Woolloongabba in QLD; Sealy now has 1,100 people working across the business in our five Australian plants, and in eight countries across the Asia Pacific. Added to this is our great network of Sealy

Franchisee partners committed to product continuity and excellence across the globe. It’s important to note our model still remains strong – build, service and deliver locally. So all Sealy beds built in Australia are manufactured using Australian steel and Australian components. Every bed manufactured in Australia has a spring unit built in Brisbane. So in summation, there’s a lot to look forward to in 2019. Strong Customer relationships, a dynamic global marketplace, exciting projects and innovative product. Energised, committed and galvanised.

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Terry Ngan

Director of Hotel Operations, CP Group Airbnb will continue to provide competition to hotels albeit owners will increasingly face more regulatory controls.

THE GENERAL BUSINESS outlook for 2019 for CP Group hotels in New Zealand is positive, driven by reasonable domestic GDP growth forecast of 3 per cent and overseas visitor growth outlook for 2019 of 4 per cent or 130,000 up on 2018. However, extra hotel supply in Auckland in 2019 – due to new hotel openings and post refurbishment of existing hotels – will mean hotel occupancies will likely be similar to 2018 of approximately 88 per cent and room rates will increase slightly above cost inflation of 4 per cent. New supply will put pressure on low season trading and annual hotel profitability. Hotel operators will need to be increasingly efficient, strong in revenue management and creative in sales and marketing.

The overseas FIT leisure market will continue to grow in New Zealand with aggressive hotel chain sales and marketing, and national and regional destination marketing being critical success factors. Domestic corporate demand for New Zealand hotels should be solid but revenue management by hotel chains will need to be strong to combat pricing pressures and cover significant payroll costs forecast. Major challenges in the New Zealand hotel industry currently include significant increases in wage rates and salaries occurring in the next three years (minimum wage rising 25 per cent) and labour shortages in certain fields of expertise, including food and beverage, revenue management and sales and marketing. Significant refurbishments and CapEx are forecast in 2019 by CP Group driven by occupancy and room rate increases in the last five years, which has seen RevPAR rise over 80 per cent in Auckland and Queenstown. Rates have risen to more international levels. In addition to developing five new hotels, CP Group will in 2019 be refurbishing five existing hotels and repositioning some up to 4.5 and 5 star. The growth of the New Zealand aviation market has slowed after a phenomenal increase in the last three years of new airlines flying into New Zealand. Air New Zealand’s new routes and increase in flights out of USA is consistent with the strong growth of American visitors to New Zealand in recent years. Despite the benefits of the run up to the America’s Cup in 2021 and the new International Convention Centre in Auckland opening in 2021, significant new hotel supply proposed to open in 2019-2022 will signal the “end of the golden goose” period of hotel growth, which has occurred in the past five years in Auckland, Wellington and Queenstown.

Mixo Bar, SO/Auckland

SNAPSHOT: CP GROUP Number of hotels and rooms: 34 hotels (5,000 rooms) Hotel brands/chains: AccorHotels, Hilton, IHG, Radisson, Wyndham and CPG Hotels (in-house brand/chain) Number of employees: 2,500 Year the company was founded: 1985 SO/Auckland boasts harb our views 52 HM The Business of Accommodation

LEADING OWNERS

I would love to invest more in the Hunter Valley, but the question that every regional council has to answer is – why would a private investor bother injecting millions into sustainable development if they are not interested in supporting it? Would they prefer open-cut mines? I stress that all administrations need to look at their processes. I have an exceptional track record on introducing environmentally-sensitive initiatives in my properties in the Hunter Valley and Blue Mountains because I love the areas. In fact, I’m passionate about them. Unfortunately, sometimes that passion isn’t reciprocated – I’m hoping for better on the Gold Coast. Hilton will be the fifth hotel management company I have dealt with. Given this is a publication that every hotel group reads religiously, I thought it was a good opportunity to say a few words about the ownermanagement relationship. Frankly, Hilton has underperformed with their Surfers Paradise hotel, which is why I am getting it at such a bargain price. The potential is there, but I think there is a lot more to deliver. Given the massive increase in rooms on the Gold Coast, I want to know why and how a management company is going to deliver the appropriate value to me. Hotel management contracts aren’t forever – you have to deliver the goods. You also have to be open to new ideas, new innovations, and not just say ‘no’ because it might not have been done elsewhere in the network. TAA’s Hotel Innovation report last year showed that (some) hotels in Australia are doing amazing things and thinking outside the box. But too many hotel management companies still use the excuse of ‘brand audits’ to not do anything, or enough. Perhaps there’s a message there for hotel management companies. If you want to justify your rather sharp management fees, let’s see some equally sharp and innovative ideas. Then the whole industry wins.

Dr Jerry Schwartz

Director, Schwartz Family Company It’s 2019, which means it’s time for a shake-up in the hotel world.

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THERE’S A LOT to be said for buying where a) the fundamentals make sense and b) where you actually like the destination. They were my reasons for starting 2019 when I purchased the Hilton Surfers Paradise. I have a unit in Surfers Paradise, and since having children, I have spent a good deal of time up there. It has everything Australians and, even more so, overseas visitors want from a premium holiday destination. There’s a touch – let’s call it an “Aussie touch” – of Las Vegas, but it is still built around spectacular natural beauty – the beaches on one side, the Gold Coast Hinterland on the other. The destination understands tourism because they know that’s what employs their youngsters and attracts investment to the region. Unfortunately, this is in direct contrast to places like Cessnock in the Hunter Valley, where I have invested over $100 million in the Crowne Plaza Hunter Valley and several other associated interests. You would think that would make the Schwartz Family Company quite popular with local administrators, given that we are playing such a key role in transforming the region from destructive mining to sustainable tourism. But no, Cessnock Council love the talk. It just hasn’t learnt to walk the talk.

SNAPSHOT: SCHWARTZ FAMILY COMPANY Number of hotels and rooms: 13 hotels, 3,565 rooms (Takes ownership of Hilton Surfers Paradise in May 2019) Hotel brands / chains: AccorHotels, IHG, Marriott, Rydges (Hilton will join this group effective May 2019) Number of employees: Approx 3,300 Year the company was founded: 1977

hotelmanagement.com.au 53

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Paul Salter

Managing Director, SB&G Group While 2018 was a year of expansion and acquisition for SB&G, 2019 will be a year of consolidation and active asset management within our Hotel Group.

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 SB&G’s operations. CapEx will be up on 2018, with spending this year 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. 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 35 and increasing our meeting space facilities by 100 per cent to achieve 1,200 square metres of purposebuilt state of the art facilities, providing 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 10 rooms and 150 square metres of meeting space and relaunch with two new destination restaurant and bar facilities. 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, we plan to proceed with construction of a new Holiday Inn Express alongside our current Crowne Plaza hotel, together with new restaurant and bar facilities to establish a diversified precinct offering well connected with the neighboring National Conventional Centre and Canberra Casino. 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, 54 HM The Business of Accommodation

industry specialist hotels team at SB&G, with recognised 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. In support, we will invest in ensuring our assets have programs and facilities to promote a strong staff culture, with opportunities to learn and opportunities for career advancement. Whilst we may face some headwinds in our various markets at different times in 2019 – with either new supply entries, a short-term election–related travel slowdown or possible refurbishment timeline changes – our projections for the markets in which we operate are positive, with strong underlying fundamentals. Many commentators are forecasting for unemployment to remain low and potentially decrease further, however we consider this to be a very positive factor in driving continued growth in our markets and providing our hotels in 2019 an opportunity to outperform 2018 trading. 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 our hotel management partner IHG by creating new restaurant facilities and attracting new talent to deliver on-trend experiences. 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. As Crowne Plaza hotels and other meetings-focused brands in our portfolio largely cater to business travellers and to the corporate and MICE market segments, we are not as focused on broader industry disruptors such as Airbnb. Rather, we are focused on delivering modern contemporary spaces, improved technology and connectivity within our hotels and an overall quality experience with greater flexibility and personalisation. A new opportunity for trading growth in our Group in 2019 is our recently acquired voco Gold Coast

“We consider hotel development across Australia to be at its peak right now.” Paul Salter – Managing Director, SB&G Group SNAPSHOT: SB&G HOTELS Number of hotels & rooms (Australia): 6 hotels, 1,837 rooms Number of employees (Australia): 30, plus 900 hotel operations staff Year the company was founded: 2013 Head office locations (Globally): Atlanta, USA; Sydney, Melbourne and Shanghai, China

LEADING OWNERS

property. During the second half 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 2019 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 Gold Coast Airport delivering increased airlift capacity – will drive a significant increase in annualised earnings from this property. With the outlook for 2019 and two new hotel builds scheduled for 2020, SB&G will this year launch a significant capital raise towards our stated target of $1 billion. 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 SB&G is about thinking differently, encouraging our team to analyse opportunities from multiple perspectives and to create new ways of working and partnering with brands and people we trust.

Crowne Plaza Melbourne will have 35 additional rooms once renovations conclude

#1 HOTEL MANAGEMENT SCHOOL IN ASIA PACIFIC & NO.3 WORLDWIDE (TNS Survey 2017)

www.bluemountains.edu.au Torrens University Australia Ltd trading as Blue Mountains International Hotel Management School at Torrens University Australia ABN 99 154 005. RTO No. 41343 HEP No. 4449. CRICOS Provider Code: 03389E.

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.

AUSTRALASIAN LEADERS

Simon McGrath

Chief Operating Officer, AccorHotels Pacific A strong, healthy and growing distribution system is the ticket to play and works in tandem with third party suppliers to hotels. WE ARE FORTUNATE tourism continues to be growing

on a worldwide scale and we will see that growth continue throughout the Pacific region. As a result, and not surprisingly, all state and federal governments are now focusing on the tourism sector and supporting solid investment from finance markets and hotel developers. Since 2012, we have seen new hotel supply enter most markets throughout the region, and there is continued supply to come over the next two years. AccorHotels has taken a very aggressive and strong position in this supply pipeline and we are delighted to see our range of brands popping up on the skyline of most cities. As a result of a buoyant market and new supply, there is no doubt that market performance of operators is very important. In terms of demand, we are seeing strong growth throughout the Pacific region. Leisure markets are continuing to grow both internationally and domestically, and it is important to note that a strong Australian and New Zealand traveller throughout the region continues to underpin so much of the success and performance of hotels. As our industry continues to innovate and improve its digital capabilities, major competitors, disruptors and tech innovators are not viewed as a threat in our industry but simply reinforce how much of a remarkable sector tourism is to our overall economy. Globally, the travel and tourism industry has witnessed exponential growth and sits within the top three competitive industries for Google AdWords. It is estimated to be worth as much as $100 billion for the online giant. While we have seen growth in the aviation sector supporting the hotel industry over the past five years, we caution governments, tourism bodies and airport corporations to respect and continue to support investment in airports and new inbound and domestic air routes. As the number one stimulator for tourism, airlines have a myriad of worldwide destinations they can choose to fly to, so we must not become complacent. We must make it both easy and profitable for airlines to do business in Australia and the Pacific. 56 HM The Business of Accommodation

All forms of distribution are reshaping themselves to be cost efficient and deliver strong business to hotels. AccorHotels has strongly focused on loyalty to provide it with an ability to capture customers and market direct to the hotel and thus control the business. This continues to grow at rapid pace, as one would expect. In 2019, AccorHotels will take further advantage of scale and deliver a curated platform for guests, including its one in seven Australian loyalty members, which is expected to grow to one in five. More importantly, we believe in the animation of that loyalty platform which continues to fuel great customer satisfaction and subsequently repeat guests on what is effectively the largest distribution channel in Australia. All this said, there are two pieces that remain critical to our success – the guest and our talent. In today’s world, we need to have an obsessive customer approach from the most senior office down. Certainly within AccorHotels, we hold that true. We have a heavy focus on inducting employees into this guest-first culture with training and rewarding employees who take the time to understand everyone’s story. From fundamentals including daily briefings about each guest as an individual to customer journey mapping, this guest obsession is part of our culture and we are very proud for our workforce to be leading this initiative.

AccorHotels recently opened the dual-branded Novotel / Ibis Melbourne Central

SNAPSHOT: ACCORHOTELS Number of hotels & rooms (Asia-Pacific): 1,070 hotels and 203,476 rooms Number of hotels & rooms (Australia, New Zealand and South Pacific): 341 hotels and 46,935 rooms Number of employees: 21,000 Year first hotel opened: 1991 Brands in the organisation: Raffles, Orient Express, Banyan Tree, Delano, Fairmont, SLS, Sofitel Legend, SO, Sofitel, Mantis, MGallery, Rixos, Mantis, Pullman, Swissotel, Angsana, 25hours Hotels, Hyde, Movenpick, Grand Mercure, The Sebel, Art Series, Peppers, Novotel, Mercure, Mantra, BreakFree, adagio, Mama Shelter, Ibis, Ibis Styles, Ibis Budget Head office locations (Globally / APAC / ANZSP): Paris, Singapore, Sydney, Auckland

AUSTRALASIAN LEADERS

Jonathan Wooller

Managing Partner, Alpha Hotels & Resorts From our perspective 2018 will be remembered as near to perfect as you can get for hotel operating conditions.

THE MAJOR MARKETS, both domestic and international, business and leisure, have traded at consistent levels in 2018, generally recording improved RevPAR on the prior year and most importantly – steady consistent performances – with no surprises! The challenges we faced in 2018 were similar to those of prior years, in particular with the cost of third party distribution continuing to grow and the ubiquitous business model of OTAs being a parasitic burden on the industry. It was pleasing to see the ACCC acting on the market participants’ behaviour, such as the action taken against Trivago. Key costs for the hotels remained predictable in 2018 with slightly higher than normal wage increases implemented by Fair Work in its annual review. The labour market in 2019 appears to be “ground zero” for the next Federal election. Should there be a change of government, this may be the biggest disruption in many years to not only the hotel cost base but also to work practices. Our industry is seen as a political battleground particularly by the union movement. The potential change to labour laws to permit pattern bargaining would place our industry in the dark ages and ultimately stifle investment and growth. The proposed change to penalty rates will ultimately force operators to reduce service levels, continuing to undermine our customer service experience.

SNAPSHOT: ALPHA HOTELS Number of hotels & rooms (Australia, New Zealand and South Pacific): 4 hotels 708 hotel rooms and apartments Number of employees (Globally / APAC / ANZSP): 80 Year first hotel opened (Globally / APAC / ANZSP): 2014 Year the company was founded: 2014 Brands in the organisation: 1 Head office locations (Globally / APAC / ANZSP): Sydney only

IN 2018, WE celebrated Fraser Hospitality’s 20th Anniversary with a global campaign themed ‘A World of Thanks’. This was our way of expressing gratitude towards our guests for their loyalty over the past two decades. Guests who booked direct during this promotion were automatically entered into a draw for a Grand Golden Ticket, comprising 20 free room nights anywhere in the world and USD20,000 in cash. Our region was thrilled to announce that amongst the global entries, one of our Perth guests received the grand prize. Our innovation projects centered around the theme of going ’paperless’, with our objective being to create a more streamlined check-in experience for guests and staff, reduce and remove paperwork to improve Fraser’s personal data security measures. We’re expecting headwinds to continue for Fraser Suites Perth. With international air capacity growing into Western Australia and a loyal following for our property, we feel we have an excellent product to fit the influx of Perth’s new four and five-star openings. For Capri by Fraser Brisbane, we see positive signs for the year ahead and although Sydney has come off the boil somewhat, it continues to be a strong market overall.

SNAPSHOT: FRASERS HOSPITALITY Current number of hotels & rooms (Globally): 70 hotels, 12,076 rooms Current number of hotels & rooms (Asia-Pacific): 38 hotels, 8,272 rooms Current number of hotels & rooms (Australia, New Zealand and South Pacific): 4 hotels, 788 rooms Current employee count (Globally / APAC / ANZSP): 4,399 permanent employees globally. Year first hotel opened (Globally / APAC / ANZSP): 1998 Year the company was founded: 1998 Brands in the organisation: Five Head office locations (Globally / APAC / ANZSP): Singapore

Matthew Rubie

Country General Manager Australia, Frasers Hospitality The overall outlook across our Australian properties (Fraser Suites Sydney, Fraser Place Melbourne, Fraser Suites Perth and Capri by Fraser Brisbane) is steady.

hotelmanagement.com.au 57

AUSTRALASIAN LEADERS

Graham Perry

Managing Director, Best Western Hotels & Resorts, Australasia While I’ve been at the helm of Best Western Hotels & Resorts Australasia for less than a year, I’ve been in hospitality and the travel and tourism industry for more than 30 years and remain very positive about the general business outlook for the industry heading into 2019.

I’M PARTICULARLY EXCITED about the prospect for the twelve months ahead. We transitioned to a propertydirect relationship with our Best Western head office in June 2018 and are witnessing the immense benefits that this brings – including tapping into Best Western’s strengths in technology, social media platforms, leadership in revenue management, training and our award-winning Best Western Rewards loyalty program. This international relationship translates into market growth opportunities, including combining our renowned corporate travel expertise in Australasia with Best Western’s globally recognised leadership in both corporate and leisure business. Our ‘Think Global. Act Local’ philosophy is already driving results, including increased local and regional engagement with our hotels and local tourism boards and the employment of additional leisure resources. The VFR market will play a central role in our local activities, along with participating in regional campaigns. Business and MICE markets remain the backbone of our Australasian business. We’re rolling out new

Best Western Plus Oceanside, Lake Kawana, QLD

SNAPSHOT: BEST WESTERN HOTELS & RESORTS Current number of hotels & rooms (Globally): Hotels globally: 3,643, Rooms globally: 297,082 Current number of hotels & rooms (Asia-Pacific): Hotels: 209, Rooms: 20,025 Current number of hotels & rooms (Australia, New Zealand and South Pacific): Hotels: 103, Rooms: 4,307 Year first hotel opened (Globally / APAC / ANZSP): Globally: 1946, APAC: 1994, ANZSP: 1975 Year the company was founded: 1946 Brands in the organisation: 13

58 HM The Business of Accommodation

initiatives to grow these markets, such as a Best Western Groups Tool in partnership with HotelPlanner to help conference organisers and corporate travel planners to drive group bookings. Our new Best Western Advantage program will support and incentivise our SME business clients to book direct. Disrupters are reconditioning customers and we need to listen to our customers more than ever before to address their ever-changing demands and needs. In view of this, I personally believe that we in the hospitality industry need to take the same approach and continually innovate and even disrupt ourselves. The emergence of AI and mobile technology are cases in point. Encouraging guests to book direct remains the Holy Grail for hoteliers. That’s why we need to build greater loyalty with our guests and better leverage our Best Western Rewards program and our partners’ programs. At the end of the day, all guests who arrive at our hotels decide how and when to book and our job is to ensure whichever channel they choose, they will be encouraged to book a Best Western branded hotel. That’s why OTAs are and will remain such important partners. Beyond loyalty, we’re experiencing strong growth from emerging markets, particularly China and predictably India. We’ve brought in expertise to help us plan how to best engage with this rapidly growing inbound market and are collaborating with our international offices on leveraging in-language content to improve guest experiences. To support our strategy, I introduced a new organisational structure to reflect the evolving needs of the business and our hotel owners, including demonstrating our genuine commitment to New Zealand with the engagement of a regional manager based in Auckland from January 2019. The strategy also highlights two important business goals; namely building scale through securing more quality hotels and expanding the Best Western Rewards program. Western Haven, Gleb Best e, N SW

AUSTRALASIAN LEADERS

“As an industry, I believe we often don’t place as much focus as we should on the importance of service delivery.”

Trent Fraser

Trent Fraser – Chief Executive Officer,

Chief Executive Officer, Choice Hotels Asia-Pac

Choice Hotels Asia-Pac THERE HAS NEVER been a more exciting time to work in the travel industry. In Australia, domestic tourism continues to be on the rise and we’ve seen a significant increase in the number of flights arriving with international visitors who are keen to explore our shores. In 2018, our business added ten properties to our portfolio and we celebrated the opening of our largest property – the 214-room Ingot Hotel Perth, an Ascend Hotel Collection member in Western Australia. Furthermore, our relationships in China continue to flourish with a number of new property openings scheduled for 2019. Our Revenue Management program continued to go from strength to strength in 2018 with the strategic appointment of a Director of Distribution and the number of properties involved doubling throughout the year. Our goal remains to double that number again in 2019. The success of the program is evident, with those properties included in the program experiencing RevPAR growth of 9.1 per cent in 2018. As we continue to expand, our business has remained focused on supporting our franchisees by driving direct bookings to our hotels. This remains our priority as we face increasing competition in the sector, not only from other hotels but also from Online Travel Agencies. To help address this impact, Choice Hotels Asia-Pac launched an online travel platform – Needabreak.com – to inspire people to take short breaks, offer destination ideas as well as promote and encourage direct bookings to our extensive network of more than 300 hotels. This continual investment into our digital marketing channels comes with

At Choice Hotels Asia-Pac, the strength of this tourism economy has seen us benefit from a continued and increased demand for affordable and quality accommodation. This has allowed us to continue to expand our footprint in the region.

SNAPSHOT: CHOICE HOTELS Current number of hotels (Globally): 6,800 in more than 40 countries Current number of hotels (Asia-Pacific): 300+ Current number of hotels (Australia, New Zealand and South Pacific): 200+ Current employee count (Globally / APAC / ANZSP): APAC: 60 Year first hotel opened (Globally / APAC / ANZSP): 1939/2002 - APAC Year the company was founded: Globally, 1939, APAC 2002 Brands in the organisation (APAC): Ascend Hotel Collection, Clarion, Quality, Comfort, Econo Lodge Head office locations (Globally / APAC / ANZSP): Global: Rockville, MD, APAC: Melbourne, AU

a focus on measurable ROI outcomes and was supported by a strategic above-the-line investment focused on brand awareness and driving direct traffic. We also motivate travellers to keep coming back through memorable experiences and exceptional service when they’re staying at a Choice Hotel. Good customer service stands out and leaves a positive impression. As an industry, I believe that we often don’t place as much focus as we should on the importance of service delivery. Customer service is a topic that I’m personally very passionate about, and I was honoured to recently announce the winners of Choice Hotels Asia-Pac’s Hotel of the Year Awards for 2018, which recognised and rewarded the hard work and commitment to outstanding service of our franchisees. Our five winning franchised properties spanned both regional and metro locations across Australia, and it was a proud occasion to commend the efforts of hotel owners who have gone the extra mile for our guests and who represent our business so well. I think there is an exciting opportunity for our franchisees to continue exceeding expectations and surprising and delighting our guests in new ways. An emerging trend in the accommodation sector is the rise of bespoke and unique product offerings that customise the guest experience. Creating such “wow” moments sets your hotel apart, encourages brand loyalty and is another way of delivering exceptional and memorable customer service. Our global loyalty program, Choice Privileges continues to expand rapidly with over 400,000 members locally. In 2019, we plan to expand this program with more redemption offerings creating more value for our members. Choice Hotels Asia-Pac’s 2019 priorities will see us continue our focus on delivering quality guest experiences and the ongoing expansion of our business with a significant pipeline of new properties already scheduled throughout the region. hotelmanagement.com.au 59

AUSTRALASIAN LEADERS

ALL OF OUR three hotel brands – QT Hotels and Resorts, Rydges Hotels and Resorts and Atura Hotels – delivered strong growth in 2018. QT Perth opened last August to enthusiastic reviews, delivering our first QT property on the west coast and our ninth QT in the group. Atura Adelaide Airport – directly connected to the Adelaide Airport terminal – opened in September 2018 and is the fourth hotel in the Atura portfolio. Throwing the stuffy restrictions of traditional hotels to the wind, Atura’s signature philosophy is underpinned by urban design, quality F&B and great local hospitality. In 2018, we signed management agreements for 10 new hotels including four Rydges-branded properties in Mackay, Newcastle, Darwin and regional South Australia and a number of independently branded hotels including The Ultimo in Sydney, The Hermitage in Mount Cook, NZ and The Park Hotel Brisbane. One of the things that differentiates us is the fact that we are both an owner and We’ve seen a rise in the popularity of guests seeking unique experiences. an operator – whereas our competitors are largely just operators. Where we have management a Adelaide Ai agreements, we run the hotels as if we rpo Atur rt ew n e own them, maximising owner profits. a significant strength of ours. Our guests tell us that one h T Our hotels are benefiting from of the reasons they choose QT Hotels is because of our growth in conference and events popular bars and eateries. Each is bespoke to the hotel; at revenues, particularly from food QT Melbourne’s Pascale there’s a definite French touch, and beverage, which as a group is Santini at QT Perth has been recognised as Perth’s best Italian inspired restaurant and at Yamagen on the Gold Coast, we offer an authentic Japanese dining experience. Our Rydges brand – an authentic Australian and New at the QT Melbou y a w rne a ir e st Zealand experience for travellers – embraces the local c n tra culture throughout its guest offering. Born Australian, En every Rydges is unique and reflects the local community in which it resides. Our diverse people are serviceobsessed in a down-to-earth local style, which we believe is unlike any other hotel brand in the market. In 2019, as can be seen in industry statistics, we expect a tougher trading environment. Unique experiences are required to win in tougher markets and that is what we are focused on. Challenges include managing the ever-increasing cost of doing business and ensuring our brands and experiences are in line with the latest trends, as the demographic of guests and their expectations continue to change dynamically. This poses an opportunity as well as a challenge! Travel continues to become inherently social and connected, where it is as much about sharing as experiencing. Our social footprint for our brands continues to increase exponentially, with ever-increasing volumes of imagery and video being shared by our teams SNAPSHOT: EVENT HOSPITALITY and our guests. It is rewarding to see our brands and Current number of hotels & rooms (Globally): 60 Hotels, 9,858 rooms experiences so powerfully brought to life in digital form. Current employee count (Globally / APAC / ANZSP): approx 3,500 (for Regarding our future development plans, we will EVENT Hotels) continue the strategic acquisition of existing hotels Year first hotel opened (Globally / APAC / ANZSP): 1986 where we can add value and seek management Year the company was founded: 1910 agreements across our three brands. We also look Brands in the organisation: QT Hotels and Resorts, Rydges, Atura, Thredbo forward to bringing Auckland its very first QT Hotel on Alpine Resort and several locally branded hotel brands. Viaduct Harbour and opening the new Rydges Wellington Head office locations (Globally / APAC / ANZSP): Sydney Airport in 2019. QT Parramatta remains on track to open its doors in 2020.

Norman Arundel

Director of Hotels and Resorts Operations, Event Hospitality and Entertainment Limited

60 HM The Business of Accommodation

AUSTRALASIAN LEADERS

Heidi Kunkel

Vice President, Operations, Australasia, Hilton In late 2018, Hilton commissioned a study into the impact Hilton, as the first global hotel company, has had around the world.

ENTITLED ‘THE HILTON EFFECT’, the study illustrates the positive, world-altering impact our company has had, and continues to have, on billions of lives and thousands of communities around the globe. Hilton is entering new travel markets and bringing people and cultures together to make the world feel smaller, while expanding horizons and opportunities. Year 2019 is certainly shaping up to be our most dynamic year yet as we celebrate our 100th anniversary. With the launch of three new brands globally, innovations like the first mobile-centric Connected Room and expansions into eight new countries, Hilton is pioneering the way for the next century of hospitality. Hilton entered the Australasian market in 1974 with the opening of Hilton Sydney. The region has since expanded to 26 operating hotels and I have a growth ambition to double

e by Hilton Per bleTre th m Dou ar

Hilton Port Moresby is connected to the city’s convention centre

d’s an

eb r

its footprint within the next five years. Seven hotels are already in the pipeline. This last year has seen the introduction of the Curio Collection by Hilton brand in Australia with the opening of West Hotel Sydney. Additionally, we opened Hilton Port Moresby – the company’s first hotel in Papua New Guinea – and DoubleTree by Hilton Perth Northbridge, the first DoubleTree property to open in WA. In 2019, we will continue to look for opportunities to expand our footprint further. We want to put the right brands, in the right locations, at the right time, and plan on doing this by identifying gaps in the market and working with likeminded partners. We are currently looking at several development opportunities which we anticipate will bring over 2,000 additional rooms to the region. We look forward to sharing news on these exciting developments during the first half of 2019. As travellers become increasingly time poor, we are constantly looking for innovative ways to make their travel experiences more efficient. In 2018, we launched ‘Connected Room’ in the US, which will soon expand to thousands of additional rooms globally, including Asia Pacific. This enables guests to personalise and control every aspect of their stay from one point – their mobile. This concept is a further extension of our existing Hilton Honors app which Hilton Honors members are already using to check-in, select their room and open the door with Digital Key. We are literally opening new doors with our innovative technology and will continue to be pioneers in this space. Our team members continue to be our greatest asset. We are a business of people serving people and it’s our 4,000-plus Team Members across Australasia that set us apart. They are at the core of our success. Our philosophy is simple – to be an inclusive employer that encourages and supports diversity, as well as engages our Team Members toward a common vision and value. I have great confidence that 2019 is going to be a great year. Our commitment to be the world’s most hospitable hospitality is evidenced in our growth and development plans, our innovation and purpose-led team culture. ‘The Hilton Effect’ is real, and I couldn’t be any prouder to be part of it. Here’s to the next 100 years!

SNAPSHOT: HILTON

t in tern A Wes

ustralia

Number of hotels & rooms (Globally): 5,560 hotels Number of hotels & rooms (Asia-Pacific): 257 hotels Number of hotels & rooms (Australia, New Zealand and South Pacific): 26 hotels Number of employees (Globally): 405,553 Number of employees (APAC): 57,185 Number of employees (Australia, New Zealand and South Pacific): 4,186 Year first hotel opened (Globally / APAC / ANZSP): Global: The Mobley (1919), APAC: Hilton Tokyo (1963), Australasia: Hilton Sydney (1974) Year the company was founded: 31 May 1919 Brands in the organisation: 15 brands Head office locations: Virginia, Singapore and Sydney

hotelmanagement.com.au 61

AUSTRALASIAN LEADERS

Glenn Bourke Chief Executive Officer, Hamilton Island

We expect the MICE market to outperform the previous two financial years and we are continuing to upgrade our facilities.

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their own

62 HM The Business of Accommodation

HAMILTON ISLAND’S FORECAST remains robust for 2019, however we expect to be operating in a different market environment to what we saw in recent years. Having enjoyed occupancy rates of over 90 per cent for several years – with strong average room rates to match – we are seeing some very gentle signs of slowing in the market. Our industry partners echo this observation. We attribute this to the domestic market with influencing factors being overall conservatism in the economy, especially concerning housing valuation, and the uncertain political scene with a looming federal election. When observing the international market, the Australian dollar remains at stable levels, continuing to make our destination competitive and appealing to international travellers. Hamilton Island’s inbound international market has seen significant growth, particularly in the Chinese market. Like many industry peers, we can wax lyrical about the uplift we have seen from Asia in the last three years, but we now predict this market to stabilise. Despite this, I expect the Asian market to continue to build productivity for the industry in the longer term. A key emerging international market we expect to see is India. Whilst starting from a low base, India has the critical mass to be a key growth market, however I feel it is still quite a way off and we have not seen the same levels of acceleration as Asia just yet. Despite this, India has a population of 1.35 billion people and there is no doubt in my mind this market will generate recognisable growth within the decade.

“We are considering how we grow our endurance events knowing our guests have an interest in their health and fitness while on holiday.”

Following the multi-million-dollar refurbishment of the Hamilton Island Conference Centre, our MICE market continues to strengthen and we are seeing real growth in this area. In 2019, we see a greater opportunity to incorporate a higher proportion of our business from the Conventions and Events market, with indications showing this category to be buoyant as FIT travel softens. In 2019, construction will begin on our new $3.5 million convention space – the Bougainvillea Marquee. Located directly on Catseye Beach, this new facility will be ideal for trade expos, conferences, weddings and gala dinners. Dialogue about ‘online disruptors’ such as Airbnb and Uber continues within our industry. However I believe they are not disruptors per se, but rather simply competition like any other business. Hamilton Island has a diversity of products, including residential properties rented as holiday homes. We naturally prefer the highest possible occupancy in this accommodation type and have found mechanisms like Airbnb to be helpful with the promotion of this side of our business. In recent years the Australian tourism industry – Hamilton Island in particular – has a lot to thank the aviation industry for. The sheer competitiveness of the industry has created some wonderful by-products, being our propensity as Australians to travel both domestically and abroad comparatively more cheaply than we did just a decade or two ago. Aircraft development has given us lighter and more efficient planes that require less maintenance and fuel and have had a dramatic impact on the cost of travel – opening the doors to more Balcon remote locations like Hamilton Island y vie ws at and other boutique destinations qu ali within Australia. One the most significant happenings for tourism in the Whitsunday region in 2019 is the reopening of Daydream and Hayman Islands after several years of reconstruction and refurbishment. We look forward to welcoming our neighbours back after the devastation of Cyclone Debbie and wish them every success going forward.

SNAPSHOT: HAMILTON ISLAND Number of hotels & rooms (Globally): 535 across four resorts plus 126 holiday homes Number of employees (Globally / APAC / ANZSP): 1,200 Year first hotel opened (Globally / APAC / ANZSP): 2003 Year the company was founded: 2003 Brands in the organisation: Hamilton Island Head office locations (Globally / APAC / ANZSP): Hamilton Island and Sydney

AUSTRALASIAN LEADERS

WE ARE GEARED for a strong 2019. Overall inbound tourism continues to grow into New Zealand. Annual visitors hit 3.8 million, up 3.6 per cent year-on-year. Australia is our largest source market with almost 1.5 million visitors per annum. Second is China at nearly half a million, followed by the USA at about 350,000. For all three, we expect continued growth. New air services from major USA cities such as Chicago into Auckland will fuel the growth from this market as with the many carriers out of China now flying to Auckland and Christchurch. We continue to promote the Heritage brand at off-shore trade shows. We also attended Tourism New Zealand trade missions to South East Asia and South America. We remain a strong hotel chain for the MICE market, and have excellent large capacity venues in Nelson and New Plymouth as well as exclusive executive properties in our Heritage Collection. For example, Marlborough Vintners Hotel and Waitakere Estate near Auckland. An ongoing challenge across the industry is attracting and retaining committed employees and creating a rewarding career path for them. We were proud last year to be acknowledged for our efforts in the HR realm when Heritage Queenstown was named the ‘Employer of the Year’ in the 2018 Queenstown Business Awards. The judges’ appreciation of our staff service and community responsibility was a great endorsement. This is encompassed in our ‘H.O.P.E’ values of Honesty, Ownership, Passion and Empathy. The philosophy keeps the team united and focused on our mission to offer the most enriching Heritage experience for our guests. Sustainability still resonates for many guests in choosing our hotels and we were pleased Heritage Queenstown was also honoured with a Qualmark Enviro Gold certification this year for our green initiatives. Major challenges for the hotel industry are the large commissions by OTAs and how to encourage our customers to book direct on our website. In late 2018, Heritage Hotels appointed HEBS Digital – which focuses on assisting hoteliers dramatically increase direct bookings through specialised marketing solutions – to build Heritage’s new website. Our new site offers all our properties a comprehensive, mobile responsive website on a leading-edge technology platform. There are also improved hotel room and conference venue showcases allowing guests to gain a greater insight into what they are booking. The site is strictly geared to driving direct bookings with strong calls to action and an ever-present booking widget.

Graham Yan

Chief Executive Officer, Heritage Hotel Management Demand for New Zealand as a destination overall is very positive for 2019.

SNAPSHOT: HERITAGE HOTELS Current number of hotels & rooms: 18 hotels and 1,174 rooms Current employee count: 700 Year first hotel opened: 1995 Year the company was founded: 1994 Brands in the organisation: Heritage, CityLife and Heritage Collection Head office location: Auckland

“An ongoing challenge across the industry is attracting and retaining committed employees and creating a rewarding career path for them.” Graham Yan – CEO, Heritage Hotel Management

Another ongoing issue for our hotels in the top NZ tourism destinations is the prevalence of Airbnb and its ever-increasing and competing inventories. Some local Councils have instigated new directives to curtail Airbnb, such as in Queenstown and Auckland. But media report almost three-quarters of Airbnb operators are not declaring their property is in commercial use and are still coasting along on residential Council rates. With little resources to police this by the Councils, these Airbnb businesses could easily continue unimpeded. Another thorn in the side of Auckland’s commercial accommodation sector is the City Council’s targeted rate. In winter 2017, targeted rates were summarily handed down on the Auckland hotels on top of their normal commercial rates. This will be tested in court in May of this year when a group of hoteliers will challenge the legality of this Council action. Looking forward, we will have our eye on the winter season. We have two great hotel products now for the ski market in Queenstown and Cromwell and are confident of a good season. However, we will be looking for greater regional tourism leadership in other cities for effective winter campaigns that draw guests in the slower months. Over the next 12 months at Heritage Hotels, we have several projects and opportunities on the go for franchise and managed properties. One will be a welcome dot on our New Zealand hotel map in a very popular business destination. We continue to talk with independent regional properties who are attracted to what our Heritage Collection membership can provide. hotelmanagement.com.au 63

AUSTRALASIAN LEADERS

Leanne Harwood

Managing Director, Australasia & Japan, IHG My first year as IHG’s Managing Director of Australasia & Japan has been truly exhilarating.

THIS IS TRULY the golden age of hospitality. With travellers continuing to flock to our shores and a positive outlook for the Aussie economy, the market is responding with a voracious appetite for new hotels. It’s fantastic news for the industry, and it has certainly meant a busy year for IHG. We enjoyed a monumental shift in our growth momentum in 2018, delivering our highest number of signings ever in Australasia. We are growing at an unprecedented rate, but still with a focus on quality hotels and brands with great partners. I’d like to call out a few developments about of which we are particularly proud: In June, we launched voco, our new upscale brand. Australia made history as the first market globally to sign a voco, which opened on the Gold Coast in November. What’s more, three more voco hotels have since been signed in Victoria’s Yarra Valley, Melbourne Central and Kirkton Park Hunter Valley. The Whitsundays will welcome a new era of luxury in 2019 with the signing of an agreement to take over management of Hayman Island, rebranding it as Hayman Island by InterContinental. The agreement with Mulpha Australia Limited also sees us continue our longterm deal to manage both InterContinental Sydney and InterContinental Sanctuary Cove Resort. In 2018, we achieved a major milestone with the full Australian implementation of IHG Concerto, our nextgeneration cloud-based technology for merchandising, pricing and selling. The platform, built in partnership with technology leader Amadeus, will deliver an even more personalised guest experience – giving guests more of what they want, when and how they want it. The acquisition of Regent Hotels & Resorts in March 64 HM The Business of Accommodation

brings the much-loved brand into the top end of our portfolio, increasing our presence in a fast-growing luxury segment worth $60 billion. The intention is to grow the portfolio from six to more than 40 hotels in gateway cities and iconic resort locations, beginning with Regent Kuala Lumpur, signed in October. Following our record year of signings, we now have the exciting task of opening at least 27 amazing hotels over the next few years. We’ve up-resourced our support team in Sydney with an additional 23 people already on the ground, ensuring we are resourced and ready to deliver. With Pro-invest also opening Holiday Inn Express Newcastle in the coming months, it was exciting to see Virgin Australia launch international flights between Newcastle and Auckland. Equally heartening was AirAsia’s launch of flights to Melbourne’s Avalon Airport. An extra 500,000 passengers is great news for Melbourne and particularly for nearby Holiday Inn Melbourne Werribee and Holiday Inn Geelong. In fact, it seems that barely a week goes by where an international airline doesn’t add capacity to the capital cities. Perth, in particular, has had some significant boosts with Qantas’ new direct London service and ANA – IHG’s joint venture partner – flying direct to Tokyo. With this level of confidence in the market, I expect our growth momentum to continue with more hotel signings in partnership with new and existing owners. Our focus continues to be on growth in the lifestyle segment with our Hotel Indigo and voco brands, as well as continuing the Holiday Inn expansion in regional or satellite Australian cities. We also see opportunities in Canberra and Queensland and, as airlift improves, the Pacific Islands. New Zealand remains robust, with Queenstown a focus given its RevPAR growth. There is an unprecedented sense of shared accomplishment and anticipation among the IHG team – and the industry – about the future. The most rewarding piece is feeling the genuine excitement from our 5,000+ hotel colleagues in Australasia as they prepare to take the next step of the journey with us. Get ready, because we’re just getting started.

SNAPSHOT: IHG Number of hotels & rooms (Globally): 5,518 hotels; 825,746 rooms Number of hotels & rooms (EMEAA): 1,023 hotels; 205,829 rooms Number of hotels & rooms (Australia, New Zealand and South Pacific): 48 hotels; 10,685 rooms Number of employees (Globally / ANZSP): Global – 375,000; ANZSP – 5,000+ Year first hotel opened (Globally / ANZSP): Global – 1949; ANZSP – 1962 Year the company was founded: 2003 (InterContinental Hotels Group PLC) Brands in the organisation: InterContinental Hotels & Resorts, Regent Hotels & Resorts, Kimpton Hotels & Restaurants, voco, Hotel Indigo, EVEN Hotels, HUALUXE Hotels and Resorts, Crowne Plaza Hotels & Resorts, Holiday Inn, Holiday Inn Express, Holiday Inn Club Vacations, Holiday Inn Resort, avid hotels, Staybridge Suites, Candlewood Suites Head office locations (Globally / APAC / ANZSP): Global – Buckinghamshire, UK; ANZSP – Sydney, Australia

AUSTRALASIAN LEADERS

Nick Georgalis Founder and Managing Director, Iconic Hotels – hotel division of Geocon

In just under eight years, Iconic Hotels has become the largest independent hotel company in Canberra, with a pipeline of hospitality projects worth over $500 million. A CORE DIVISION of Geocon – the fourth largest residential builder/developer in Australia – Iconic Hotels specialises in hotel operations, management, training and strategy, as well as food and beverage outlet management and operations. Previously known as Abode Group, the company recently rebranded to Iconic Hotels and currently contributes 500+ hotel rooms to the accommodation market in Canberra and surrounds. Our flagship brand, Abode Hotels, specialises in affordable and flexible apartment accommodation in key locations. The corporate rebrand in August last year better aligned the company with the growing portfolio of hotel brands in our development pipeline. What started in 2010 as a small upscale hotel brand has rapidly developed into the largest independent hotel company in the ACT. With no intention of slowing down, over the next five years Iconic Hotels will deliver 500+ hotel rooms to the luxury, upscale and midscale markets. As an independent brand, it’s an exciting time to be challenging and changing the accommodation landscape in Canberra. Our city is in a unique period of growth and development, the effects of which are greatly welcomed by the hospitality sector. Being a part of this growth is important to us and is a driving force behind what we deliver to market. As a fully-integrated property enterprise with capabilities across development, construction, hospitality management, investment, sales and conveyancing, we play a vital role in shaping Canberra’s skyline, boosting the hospitality offering and contributing to the vibrancy of a developing city. Currently, our company growth focus is in Canberra, and despite a rather gloomy market analysis and noted national decline in the hotel sector towards the end of 2018, the nation’s capital is still a high performer. Population growth is strong, driving demand to the city.

“Industry disruptors such as Airbnb pose no great challenge to our organisation and brand offering.”

Due to large infrastructure growth, light rail transport investment and the continued push for domestic and international tourism, the outlook across the hotel and tourism sector is quite positive for 2019. The domestic leisure market to Canberra is growing, as is inbound FIT travel. VFR also continues to overperform due to the prevalence of cultural attractions, general city precinct proximity, ease of travel and accessibility. Industry disruptors such as Airbnb and Uber currently pose no great challenge to our organisation and brand offering, nor do I believe the traditional hotel market. The only concern I have is the lack of regulation and governments’ perceived unwillingness to act on this. However overall, disruptors have created a new market and remind hoteliers of the importance of innovation. Innovation and market timeliness are paramount to Iconic Hotels. While still a relatively young business, we have a solid track record of production and delivery in the accommodation sector. Furthering this success is our pipeline of major hospitality projects scheduled for release to market across the next five years. In 2018, we opened two new hotels and took over the management of a third. This year, we will expand our flagship brand (Abode Hotels) to the south coast of New South Wales and will also commence construction and development of a new luxury hotel offering to Canberra. Extensive qualitative market research highlighted a gap in the current upper-upscale accommodation offering, which prompted us to completely redefine the luxury travel market in Canberra. Our new brand will present the ultimate exclusive, luxury experience for the discerning traveller – distinctive in design, innovative in delivery and unparalleled in brand offering. Our first luxury build will bring glamour and prestige to Canberra’s city centre, while our second build will make history as we redevelop and preserve the iconic Heritage-listed West Block building within Canberra’s Parliamentary Triangle. Both set to open by 2021, these hotels will further complement the growing brand portfolio of Iconic Hotels. There’s luxury in creating a legacy. Each day Iconic Hotels is doing so. We are challenging the market status quo, reshaping what is possible and creating an iconic Canberra by building beautiful new hotels and precincts for generations to come.

SNAPSHOT: ICONIC HOTELS Current number of hotels & rooms (Globally): 7 hotels and 551 rooms Current employee count (Globally / APAC / ANZSP): Iconic Hotels – 250+; Geocon – 250+ Year first hotel opened (Globally / APAC / ANZSP): 2010 Year the company was founded: Iconic Hotels – 2010; Geocon – 2007 Brands in the organisation: Two established hotel brands (Abode Hotels and The Woden Hotel) and an additional three to be released in the coming years (spanning luxury to mid-scale) and two food and beverage brands (No.10 Restaurant + Bar and Foundry Coffee Co.) Head office locations (Globally / APAC / ANZSP): Canberra, Australia

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AUSTRALASIAN LEADERS

Sean Hunt

Area Vice President, Australia, New Zealand and the Pacific, Marriott International The business events industry remains a key focus for us, as it drives a substantial proportion of our total revenue.

HOTEL DEVELOPMENT IN Australia, New Zealand and the Pacific continues to grow, reflecting the exceptional improvement in hotel trading conditions over the past several years. Marriott International is leading the way with 21 major hotel projects currently under construction or in planning, putting us on track to expand our network in the region to 50 hotels across 15 brands by 2020. High occupancy levels and continuing demand for new and high-quality accommodation is expected to continue to fuel this growth over the next five years. Despite having over 4,900 additional rooms already signed across Perth, Melbourne, Adelaide, Brisbane and Sydney, we believe there’s still room for more. We also have the clear number one position for upper-upscale and luxury properties across the region, with two-thirds of the new supply pipeline. Increasing numbers of high net worth travellers from Asia are driving demand for luxury hotel accommodation across Australia, where we’re introducing five hotels from our top-tier luxury brands. The Ritz-Carlton brand will re-enter Australia in late 2019 with the opening of The Ritz-Carlton, Perth in

SNAPSHOT: MARRIOTT INTERNATIONAL Number of hotels & rooms (Australia, New Zealand and South Pacific): 31 hotels; 7,870 rooms Number of employees (ANZSP): 5,593 Year first hotel opened (Globally / APAC / ANZSP): 1957 Year the company was founded: 1927 Brands in the organisation: 30

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the city’s much-anticipated Elizabeth Quay waterfront development. The Tasman, a Luxury Collection Hotel, Hobart is set to open in 2020, marking Marriott International’s debut in Tasmania and setting a new standard for luxury properties in Hobart. The St. Regis will debut in Melbourne in 2021 and W Sydney and W Melbourne are on track to open in 2020. We’re also seeing greater demand for lifestyle hotels in response to the changing accommodation preferences of Millennials and Gen Z travellers. These budget-conscious travellers are looking for hotels that allow guests to work, play and connect at an affordable price point. Marriott International’s Element by Westin and Aloft brands – which offer novel accommodation concepts and live/work/play spaces that are designed to bring people together – feature predominantly in our development pipeline across the region. Element by Westin Melbourne is on track to open in 2019, marking the brand’s debut in Australia, and Aloft Melbourne South Yarra will follow in 2020. One of our expansion priorities in the Pacific region is to establish urban footholds for Marriott International’s newest lifestyle brand, Moxy Hotels. Launched in 2014, 30 hotels have already opened in gateway cities around the world, and there are more than 90 newbuilds in the confirmed global pipeline, including Moxy Melbourne South Yarra which is slated to open in 2021. We’re also committed to renovating and innovating our existing assets. Sheraton Grand Mirage Resort, Port Douglas, Sheraton Grand Mirage Resort, Gold Coast and Sydney Harbour Marriott Hotel at Circular Quay have all completed significant renovations in the past five years and subsequently witnessed considerable improvements in terms of performance. Sydney’s iconic Sheraton Grand Sydney Hyde Park and Brisbane Marriott Hotel are the latest properties to undergo a multi-million dollar transformation, relaunching in late 2018 with a brand-new look and feel. Our commitment to renovation and innovation goes beyond the hotel room. We’re reimagining our dining concepts, offering ‘hatted restaurants’ like Garum at The Westin Perth and cutting-edge venues like Three Blue Ducks at W Brisbane. We’ve also introduced several new and exclusive culinary partnerships such as Diner en Blanc that highlight the diversity and skill of our talented chefs and associates. Over the next year, we’ll be rolling out a series of events that complement the highend dining experiences we already offer at our hotels. All of this and more will be captured and shared on our new Meet Eat Drink website. Last year we expanded our MICE offering, providing planners with greater access to state-of-the-art facilities across Australia. The Westin Brisbane and W Brisbane opened, introducing a total of 13 new event spaces to the River City, appealing to both local and international businesses. In Sydney, the opening of Four Points by Sheraton Sydney, Central Park brought seven meeting and event spaces to Sydney’s bustling and growing neighbourhood of Chippendale.

AUSTRALASIAN LEADERS

A challenge we continue to tackle however, is recruiting and retaining extraordinary talent. It’s essential that hospitality companies offer their staff opportunities for development and success – something we are very passionate about at Marriott International. This commitment continues to be recognised externally, with Marriott International recently named Best Employer in Asia Pacific by AON for the fifth consecutive year. At the heart of Marriott International’s success is the company’s rapidly growing loyalty program – Marriott Bonvoy. The new program, launching this month, will replace the Marriott Rewards, Ritz-Carlton Rewards and Starwood Preferred Guest brands and marks the final step in the unification of our loyalty offering, enabling us to deliver personalised experiences to more than 120 million members globally. Marriott International is predicted to open a new hotel somewhere in the world every 13 hours for the next three years. Whilst this demonstrates our growth and confidence in the global market, it’s not all about adding scale. The focus remains on serving our loyal guests and delivering exceptional experiences in the world’s best destinations, to ensure our existing clientele keep returning and we continue to attract new guests.

The forthcoming Ritz-Carlton, Perth

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AUSTRALASIAN LEADERS

Quest Epping exterior

Executive Chairman & Founder, Quest Apartment Hotels

The coming year will be a remarkable one for the Quest brand as we prepare to open our first hotel in Europe. IN 2018, QUEST celebrated its 30-year anniversary with colleagues, franchisees, partners and other stakeholders, under the theme of “Our Quest Continues”. We opened our first serviced apartment hotel for the extended stay business traveller in Fitzroy, Melbourne, in 1988, which was closely followed by our first franchise in 1991. Today, the brand has grown to become the largest and fastest growing Apartment Hotel brand in Australasia, with 170 Apartment Hotels across Australia, New Zealand and Fiji. Quest experienced a strong year of growth across the country in 2018, especially in Victoria and New South Wales. We opened eight new properties in Australia and New Zealand. We continue to see strong corporate growth in the key sectors of infrastructure, government spending, professional services and health. Business travel will be affected by many important decisions that have been made offshore in 2018. Combined with political turmoil in a number of key trading partners, this will continue to drive changes for our customers. Overall, while confidence in the economy might be wavering, business activity is still evident and as such the outlook for 2019 remains very positive. Emerging markets like China and India provide interesting opportunities for the accommodation industry, especially now that these markets have matured. While emerging markets provide great opportunities, I also think we need to continue our focus on existing

“An issue we are not addressing yet is around the development and training of young people within the hospitality industry.”

SNAPSHOT: QUEST APARTMENT HOTELS Current number of hotels & rooms (Australia, New Zealand and South Pacific): 170 properties, 11,011 rooms Current employee count (Globally / APAC / ANZSP): Due to franchise model, unknown. Year first hotel opened (Globally / APAC / ANZSP): 1988 Year the company was founded: 1988 Brands in the organisation: Quest Apartment Hotels Head office locations (Globally / APAC / ANZSP): Melbourne

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markets such as the UK, United States and New Zealand. These markets are still growing in their own right, and we need to be careful not to displace good partners that have been coming to Australia for years. An issue we are not addressing yet is around the development and training of young people within the hospitality industry. If this isn’t addressed urgently, it will cause issues in finding qualified hospitality staff for decades to come. As an industry, we need to begin investing in hospitality and tourism education to promote our industry as a great career choice. The Quest brand is set to see exciting new shores in 2019. Quest Liverpool City Centre will be our first property in the United Kingdom. One of the purposes of becoming part of The Ascott Limited – the world’s largest serviced apartment owner-operator based in Singapore – was to assist the Quest brand in growing outside of Australasia, a dream now being realised. We’re aiming to have 8-10 properties in the UK within the next five years. The brand will also see continuous and sustainable growth here in Australia and New Zealand, where we are adding a further nine properties in 2019. We pride ourselves on our development model, working with our development partners to build and open eight to ten properties each year consistently and bring new apartment hotel stock to the market. In January we will open Quest NewQuay in Melbourne’s Docklands, our largest Apartment Hotel to date with 221 apartments. This new location will serve business traveller demands from both Docklands as well as the West of Melbourne. New development in regional areas remain a focus for Quest as Australia decentralises further and regional areas grow into regional centres and regional hubs. In the face of our continued growth, we remain committed to our core focus and objectives; to meet the accommodation needs of the extended stay business travellers, continue to raise the standard of our product offering and attract new franchisees into our business. This commitment, strengthened by the success of our proven business format franchise system, ensures that we maintain our position as the leader in the extended stay accommodation market across Australasia.

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AUSTRALASIAN LEADERS

Peter Tudehope

General Manager, Radisson Blu Plaza Hotel Sydney & Regional General Manager, Radisson Hotel Group The ICC forward bookings for 2019 are not as strong as was anticipated. The effect will be felt in the winter months. THE THREE MAJOR markets in which Radisson Hotel Group (RHG) operate in Australia and the Pacific are Sydney, Melbourne and Fiji. The two Australian markets will continue to perform in a similar vein to 2018. There will be pressure on rates, but occupancies will continue to be in the high 80s. For Sydney, the Airport and the ICC are two major demand drivers. We need to work with governments to increase the capacity of Sydney Airport by increasing aircraft movements per hour to allow more arrivals and departures on a daily basis. This single change will have an enormous impact on the number of arrivals each day. The Sydney CBD will come back to some sort of normality with the completion of the light rail along George Street. This should see a return of weekend leisure business that has been avoiding the city during construction. There will be a State election in NSW and a Federal election in the first half of 2019. Regardless of who wins, the impact should be felt more in 2020. Melbourne is more about business as usual while at the same time continuing to absorb more supply. The events

“Shadow Supply is here to stay and will continue to be a disruptor. In both Sydney and Melbourne, the impact is starting to be noticed.”

calendar for 2019 remains robust, but like Sydney, the Convention Centre is not showing any significant growth over this year. Fiji is starting to show good signs outside of Australia and New Zealand, however will continue to rely on these two for the bulk of its business. USA and China are anticipated to grow into Fiji in 2019. Distribution platforms and dynamic rates are blurring the lines between traditional hotel market segments. How long we will continue to refer to these traditional segments as we have them today is the real question. MICE – This space will become very competitive in Sydney due to the lack of Citywide conventions at the

SNAPSHOT: RADISSON HOTEL GROUP Current number of hotels & rooms (Globally): 1,400-plus Current employee count (Globally): More than 5,000 Year first hotel opened (Globally): 1960 Year the company was founded: 1960 as Copenhagen SAS Group Brands in the organisation: Radisson, Radisson Blu, Radisson Red, Radisson Collection, Park Plaza, Park Inn by Radisson, Country Inn & Suites and Prizotel Head office locations (Globally): Stockholm, Sweden and Brussels, Belgium

70 HM The Business of Accommodation

Rad y isson dne Blu Plaza Hotel Sy ICC. We are also competing with standalone purposebuilt meeting spaces opening all over Sydney. Digital booking platforms have become far more user-friendly from an end user’s point of view. We should see an increase in MICE business on national level in 2019. Leisure – Australia and Fiji are still very attractive destinations for the leisure traveller. In 2019, we should continue to see strong growth out of China, India, and to a lesser extend the USA and New Zealand. Domestic leisure will continue to drive room nights, particularly if the AUD stays where it presently is versus the USD. The event calendars for both Sydney and Melbourne are looking better than ever and should drive high demand. Business – This segment continues to be the key segment for RHG hotels in Australia. It is still the most significant market segment for most hotels in Sydney and Melbourne. It should remain strong throughout 2019 although there could be an impact from the election. Shadow Supply is here to stay and will continue to be a disruptor. In both Sydney and Melbourne, the impact is starting to be noticed. Combined with new hotel supply coming on-line, we are seeing downward pressure on rates. State governments need to have the courage to regulate this industry by introducing registration, so the transparency demanded of our industry applies to them. One of our biggest challenges is attracting people to work in our industry. Lifting the profile of the accommodation sector as an attractive career choice for both secondary and tertiary students should be one of our highest priorities. This combined with Visa restrictions on certain positions is depriving our industry of much needed skilled labour. We need to advocate the federal government for ease of access to 482 Visas as pathways to permanent migration for international students, and improved flexibility of all labour visas.

AUSTRALASIAN LEADERS

THREE DECADES FOLLOWING that Oscar-nominated flick, and with tourism positioned as one of Australia’s key economic pillars, it seems more relevant to observe: “They’re coming, and we haven’t built”. There is a global arms race underway in the tourism sector. Around the world, trillions of dollars are being invested in infrastructure designed to attract visitors from within and beyond national boundaries. Here in Australia, we know of the opportunity at hand. Research trends have been telling us for some time how inbound visitation has been increasing year-on-year, usually at double-digit percentages. Long-term forecasts predict growth will continue in a steep upward curve. The question is – are we ready for the tourism boom? Do we have the necessary hotel capacity, at the standard required? Do we have the transport infrastructure to ensure efficient people movement – both locals and visitors? Are our tourism offerings authentic and compelling so we are differentiated from the rest of the world? There is a lot of work to do and no room for complacency or lethargy. We need to be urgent, agile and prepared to maximise the opportunity we have as an industry and as a nation. At The Star Entertainment Group, we are investing billions of dollars to develop global tourism destinations that can compare with the best in the world. There is a shortage of high-end hotel product in the cities in which we operate – Sydney, Gold Coast and Brisbane. Acknowledging the need for more supply and having confidence in a strong and sustainable future for our tourism industry underpins our development strategy. The Queen’s Wharf project in the Brisbane CBD will be a $3.6 billion development. It will include four hotels, with around 1,100 rooms. It will also feature 50 bars and restaurants, 12 football fields of public space, a Sky Deck with views across the river to Southbank from 100-plus metres above street level, and a range of tourism attractions.

Matt Bekier

Chief Executive Officer, The Star Entertainment Group “Build it and they will come”. It’s the oft-quoted line credited to Kevin Costner in the 1989 movie Field of Dreams.

Sky Lobby at the proposed RitzCarlton Tower The Star Sydney. Artist impression only.

The Star Gold Coast has undergone a transformation with more to come. The original hotel at the property once known as Jupiters has been completely refurbished. In 2018, we opened a luxury suite hotel, The Darling, and works are currently underway on a Dorsett tower. Queensland Government approval has also been received for a further four towers at the property as part of an expanded Master Plan worth more than $2 billion. If the masterplan is rolled out in full, we will have 3,000 accommodation keys at The Star Gold Coast – hotel rooms and serviced apartments – putting us on a level with the likes of Marina Bay Sands in Singapore. The Star Sydney has been the traditional flagship property for the group, with three hotels, including the only Forbes 5-Star rated hotel in NSW, The Darling. But three hotels do not service the demand we have built through ongoing development to improve the property. We could use another 1,000 hotel rooms in Sydney and not be over-supplied. We are currently in the approvals process to build a Ritz-Carlton hotel tower within our existing footprint at Pyrmont. Believe me, they are coming. We need to build.

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SNAPSHOT: THE STAR ENTERTAINMENT GROUP

rf ha W s ’ n uee Con cept im at Q age of Sky Deck

Current number of hotels & rooms: Seven hotels with 1,600 rooms across Sydney, Gold Coast, Brisbane. Current employee count: Around 9,000 Year first hotel opened: 1985 (The Star Gold Coast was originally Conrad Jupiters) Year the company was founded: The Star Entertainment Group was previously Echo Entertainment Group, which was spun out of Tabcorp in a 2011 demerger. The name was changed to The Star Entertainment Group in November 2015. Brands in the organisation: Current hotel brands include The Darling, Astral Tower and Residences, The Star Grand, Treasury Brisbane, Sheraton Grand Mirage Head office locations: Corporate head office in Sydney. Offices also in Brisbane and Gold Coast.

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AUSTRALASIAN LEADERS

Allan Vidor

TFE Hotels has just reopened the Savoy Hotel on Little Collins Melbourne after a major renovation

Chairman, TFE Hotels

At TFE Hotels, we’re looking forward to the year ahead as we experience a period of significant growth.

CURRENTLY, WE HAVE over 20 new hotels in various stages of development, adding to our portfolio of 73 properties across Australia, New Zealand and Europe. Whilst the outlook for 2019 is positive, we cannot ignore the challenges the industry faces in certain markets – in particular, the supply and demand ratio. In cities such as Sydney and Melbourne, there is a parade of new hotel openings though not necessarily a significant increase in overnight stays and visitor arrivals. As we know, tourism bodies and the aviation sector play key roles in driving demand. As such, hoteliers and groups such as ours need to look at ways to diversify and make our offerings even more compelling. Hence, we continue to grow the TFE Hotels Collection: a portfolio of premium boutique and individual hotels that each have a distinct story, personality and guest experience proposition, where guests create their own memories. Cutting-edge design – as demonstrated by The Calile in Brisbane – goes a long way toward creating an authentic and memorable guest experience. This is critical to create offerings that resonate with different market segments. While there is always an interest in what’s new, hoteliers need to also ensure their current properties remain modern and relevant. We are constantly looking at how we can refresh our current portfolio. We have invested heavily in refurbishments, such as at the Adina Apartment Hotel in Coogee and relaunching the Vibe Savoy into a TFE Hotels Collection property: The Savoy on Little Collins, Melbourne. Whilst modern and contemporary design is always on trend, we are seeing 72 HM The Business of Accommodation

demand from guests eager to stay in properties that have a historical or iconic twist, hence the relaunch of the iconic Savoy Hotel. We also opened the Adina Brisbane in a converted heritage-listed building and in 2020, we’ll open an Adina Apartment Hotel at the transformed Pentridge Prison in Melbourne. So, whilst there are challenges, growth and innovation – along with our guest service – will allow groups such as TFE Hotels to remain competitive. Along with our growing pipeline of new hotel openings, we are looking at further expansion in Europe, adding our brands in more cities over the next five years. We added four new hotels in 2018 including an Adina in Canberra, on Brisbane’s George Street, the Vibe Hotel North Sydney and The Calile Hotel– which is receiving international recognition for its outstanding design and offering as Australia’s first urban resort. Along with the refurbishments of existing properties, 2019 will see the opening of a striking Bates-Smart designed Adina Apartment Hotel Southbank Melbourne, a New York-inspired Vibe Hotel Darling Harbour and a Vibe Hotel Melbourne located in a heritage-listed building on Queen Street. Furthermore, we look forward to welcoming Antony Ritch as our new CEO. It will be an exciting year ahead for the TFE Hotels team.

Panoramic city views go with the expansive Penthouse at Adina Apartments Melbourne

SNAPSHOT: TFE HOTELS Current number of hotels & rooms (Globally): 73 hotels, 10,374 rooms Current number of hotels & rooms (Europe): 11 Hotels, 1,585 rooms Current number of hotels & rooms (Australia and New Zealand): 62 Hotels, 8,789 rooms Current employee count (Globally / ANZ): ANZ – 1900, Global – 2300 Year first hotel opened (Globally / ANZ): 1982 Medina Serviced Apartments launched, Europe: 2006 Adina Apartment Hotel Year the company was founded: TOGA Group 1963, Establishment of TFE Hotels joint venture 2013 Brands in the organisation: Adina, Vibe, Travelodge, Rendezvous and TFE Hotels Collection Head office locations (Globally / APAC / ANZSP): Global HO – Sydney, Regional EU HO – Berlin

AUSTRALASIAN LEADERS

Rhys Williams & Alex Thorpe

Directors, Veriu Hotels & Suites and Punthill Apartment Hotel Group Both Veriu and Punthill hotel brands are positioned to enjoy a successful 2019 with growth in the corporate travel market whilst also benefiting from record lows in the Australian dollar driving growth in both domestic and international leisure travel.

THE CONTINUED INFRASTRUCTURE boom in Australia will drive strong corporate travel demand in most major capital cities and suburban hubs around Melbourne and Sydney. This is despite some softening in the Sydney CBD market being experienced in the second half of 2018 which we expect to continue into 2019. The Melbourne market, however, will continue to perform strongly, particularly in locations for corporate travel.

for legislators is where residential properties are being converted into professional, permanent, commercial tourist accommodation, without the safety and other regulations that hotels guarantee. With the acquisition of 14 new hotels under the Punthill Apartment Hotel brand this time last year, our company is going through a period of consolidation. Last November, Punthill Apartment Hotels announced

A major challenge for the industry is recruiting and retaining good talent. It is essential for hotel operators to work more closely with tertiary institutions and create clear career paths for their people which match individual goals for development and financial success. Fortunately, we are seeing the movement of some great talent from larger hotel chains, seeking a smaller, more dynamic environment within boutique hotel groups. From a macro perspective, it is important that during a period of rapid growth in demand in the tourism and accommodation industries, the onset of new supply does not see either inexperienced operators or larger international players – who have a lesser understanding of more localised markets – drive RevPAR through placing downward pressure on ADRs. Leaders within the industry should remain confident in setting their average daily rates at levels which are commensurate with the scale and quantum of the investments made by developers and owners in establishing new market supply in an environment of high development costs. There is strong development demand within the Adelaide, Sydney and Melbourne CBD and surrounding suburban markets. Tighter residential financing restrictions imposed by the banks and a reduction in residential pre-sales have driven developers to seek alternate uses for development sites. This is coinciding with strong hotel performance and investment cap rates to create good opportunities for developers to reposition sites as hotel use. Both the Perth and Brisbane markets have been more challenging to procure development as a result of a combination of inflated land prices, relatively high building prices coupled with lower hotel yields and performance in those markets. Most sophisticated hotel groups aren’t daunted by having players like Airbnb in the market. The concern, however, is ensuring there is a level playing field in place across these platforms with hotel groups which are required to invest significantly in compliance to ensure the safety and security of their guests. The main issue

plans to develop its first new property – Punthill Alphington – under the ownership of Veriu Hotels & Suites. This marked the beginning of the Group’s plans for significant expansion of its Veriu and Punthill portfolios throughout Australia. We expect to make a number of development announcements over the next six months, including bringing the successful Sydneybased Veriu Hotels & Suites brand to Melbourne.

Veriu Broadway Lobby

SNAPSHOT: VERIU HOTELS & PUNTHILL APARTMENT HOTELS Current number of hotels: 18 (excludes UKO and furnished properties) Current number of locations: 44 (includes UKO and furnished properties) Current number of rooms: 1593

Current employee count (Globally / APAC / ANZSP): 300 employees Year first hotel opened (Globally / APAC / ANZSP): 2002 Year the company was founded: 2002 Brands in the organisation: Veriu Hotels & Suites / Punthill Apartment Hotels / UKO Furnished Property Head office locations (Globally / APAC / ANZSP): Sydney / Melbourne

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AUSTRALASIAN LEADERS

LAST YEAR WAS a record year for Voyages Indigenous Tourism Australia, with occupancies across the company’s flagship property, Ayers Rock Resort, regularly topping 90 per cent with a RevPAR well above $300. We also manage two other properties on behalf of owners, the Indigenous Land Corporation (ILC) – the Mossman Gorge Centre in Far North Queensland and Home Valley Station in Western Australia’s East Kimberley. Both smaller properties, although subject to severe seasonality issues with Home Valley Station only operational for six months of the year, continue to reflect great results in Indigenous training and employment. Ayers Rock is a destination highly dependent on affordable, convenient air capacity and new services allow the Resort to tap into previously restricted markets. A great example of this latent demand for the destination is the new Jetstar Brisbane to Ayers Rock service that commenced in 2018, with numbers out of South East Queensland at an all-time high. International markets continue to swell, which can be attributed in part to the low Australian dollar and strong air capacity with convenient connections. The increase in capacity from the US market, with American Airlines returning and new routes added by Air New Zealand and United Airlines over the past few years has been reflected in annual growth from the US. Germany, France, Japan, and Italy have also all shown strong growth over the past year and all are expected to continue in a similar trend during 2019, although we remain cautious over political instability in the US and the potential for a tightening of discretional spend on travel. The UK has clearly been affected by Brexit concerns with demand contracting recently. The developing China market continues to grow from a small base and we are now capturing more of the experiential Chinese traveller who are seeking tailored, independent travel experiences which provide different perspectives to their normal lifestyles. Central Australia – largely focused around Uluru Kata Tjuta National Park – continues to rate highly in international surveys and was named #4 ‘Must Visit’ region by Lonely Planet in 2018.

Grant Hunt

Chief Executive Officer, Voyages Indigenous Tourism Australia 2019 presents as an exciting year for Ayers Rock Resort in particular, with new direct air services from Adelaide and Darwin opening up new markets.

The Field of Light Uluru, a limited-time world class art installation by world-renowned artist Bruce Munro, has proven extremely popular and has assisted strong occupancies from both key international and domestic markets. A refresh of the installation in mid-2019 will extend the life of the attraction which is currently scheduled to close on 31 December 2020. Voyages strongly supports the Uluru Kata Tjuta National Park Board of Management in its decision to close the Climb on Uluru on 26 October 2019. We don’t anticipate the closure will have any effect on demand long term, however in the short term, the imminent nature of

“Voyages strongly supports the Uluru Kata Tjuta National Park Board of Management in its decision to close the Climb on Uluru” Grant Hunt – CEO, Voyages Indigenous Tourism Australia

SNAPSHOT: VOYAGES INDIGENOUS TOURISM AUSTRALIA Number of hotels & rooms: 6 hotels and 816 rooms (Plus Outback Pioneer Lodge – 168 lodgings) Number of employees (Globally / APAC / ANZSP): 1,080 Year first hotel opened (Globally / APAC / ANZSP): 1984 Year the company was founded: In 1992, the Ayers Rock Resort Company Limited was constituted. The company was sold in 1997 and in 2000 changed its name to Voyages Hotels & Resorts. Voyages Hotels and Resorts was acquired by the ILC in 2011 Brands in the organisation: Ayers Rock Resort, Home Valley Station, Mossman Gorge Centre Head office locations (Globally / APAC / ANZSP): Sydney

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the climb closure is driving strong business, from Japan in particular. This is expected to continue throughout 2019. We continue to apply considerable effort to the development of world class guest experiences such as Sounds of Silence, Tali Wiru, Field of Light and Astronomy tours in order to promote destination appeal and ensure our guests receive a premium experience. The strong performance of Ayers Rock Resort in particular has allowed our owners, the ILC, to invest significantly in upgrades and improvements over recent years. In 2019, we will continue this program with further upgrade work including the resurfacing of the Ayers Rock Airport runway and a refurbishment of the Resort’s top rated hotel, Sails in the Desert. Plans are also underway for the refurbishment of the budget hotel, The Outback Pioneer, in 2020. Stay tuned for another big year ahead.

1-2 MAY 2019 GRAND HYATT MELBOURNE

People, Product and Performance in a period of Unprecedented Growth Ticket and general enquiries contact Interpoint Events at info@interoint.com.au or 1300 789 845. Sponsorship enquiries contact Adam Daff at adaff@intermedia.com.au or 02 8586 6207.

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