Hotel Operations & Management
The Group's hotel operations and management
businesses performed creditably for FY2016.
Despite business slowdown in two key cities, overall
operating profit is consistent with the previous
financial year after accounting for a 10% decline in
AUD and NZD and loss of contributions from the
closure of Stamford Grand North Ryde.
The falling AUD has resulted in an increase in both
domestic and international visitors in FY2016. This
trend looks set to continue in FY2017. Demand for
hotel rooms is expected to remain strong in Sydney
and Melbourne. However, secondary cities such as
Brisbane and Adelaide will continue to experience
pressure on RevPAR in near term as prevailing supply
Stamford Plaza Sydney Airport ("SPSA")
- SPSA reported a modest 1.5% improvement
in RevPAR in the competitive Sydney airport
precinct. Room revenue is expected to remain
strong, as domestic and international visitors
continue to flow in.
- In September 2015, the Group opened its second
La Boca Bar and Grill restaurant in SPSA, following
raving reviews of its first outlet in Adelaide. Since
its opening, F&B revenue for SPSA has increased
by 13%. Ongoing marketing efforts continue to
anchor SPSA La Boca as the choice venue for
Argentinian cuisine within the Mascot vicinity.
Sir Stamford at Circular Quay ("SSCQ")
- SSCQ reported another year of respectable
results, with improvements in both ADR and GOP
margins. This award-winning hotel has also been
inducted into TripAdvisor's Hall of Fame after being
awarded the popular travel website's Certificate of
Excellence for five consecutive years.
- To maintain its leading position as a choice
hotel, SSCQ will undergo a soft refurbishment
programme in FY2017.
Stamford Plaza Melbourne ("SPM")
- SPM maintained its GOP and market position for
- Construction for another 26 rooms has
commenced, and is expected to be completed
in 2H2017. Upon completion, this addition to
the inventory will augment room revenue and
enhance SPM's asset value.
- The Group is exploring feasibility of converting
Harry's Restaurant and Bar to a La Boca restaurant
or leasing out the premises to enhance revenue.
Stamford Plaza Brisbane ("SPB")
- An increase in room supply over and above
demand has resulted in falling occupancy levels
and declining room rates in Brisbane as hotels
compete for market share. FY2016 RevPAR decline
was further magnified as results were measured
off FY2015, which was boosted by G20 Summit.
- Despite less favourable market conditions, SPB
maintained its position as the hotel and wedding
venue of choice in Brisbane for FY2016.
- A soft refurbishment programme is planned
for SPB as it strives to maintain its lead in the
competitive Brisbane market.
Stamford Plaza Adelaide ("SPA")
- Outlook for Adelaide economy remains weak,
with some 1.1% decline in RevPAR observed
across the market. Despite business slowdown,
SPA maintained its GOP due to concerted efforts
in cost management.
- SPA La Boca continues to perform well, with an
annual increase in revenue of 6%. To augment
F&B revenue, the hotel has also converted part
of its extended lobby area to a Celebrity Lounge
that offers light F&B options to guests.
- The hotel has also completed the refurbishment
of its lobby and will be commencing the
refurbishment of its porte-cochere to enhance
overall guest experience.
Stamford Grand Adelaide ("SGA")
- Overall revenue for SGA declined by 8% as rooms
and banqueting facilities were progressively
taken out of operation for refurbishment during
FY2016. Despite this, GOP margin decline is less
than 2 percentage points due to prudent cost
- The first phase of the refurbishment has been
completed and the second phase is scheduled to
begin in FY2017. In addition, plans are underway to
increase the Grand Bar's outdoor seating capacity.
- These upgrading programmes, once completed,
will reinforce SGA's position as the only 5-star
hotel in Glenelg.
Stamford Plaza Auckland ("SPAK")
- SPAK recorded a stellar performance for FY2016
with RevPAR growth of 34%, following the
timely completion of a NZ$7.9 million room
refurbishment. GOP reached a new record, with
a YOY improvement of 30%.
- With international visitors hitting new highs
and no new supply expected in FY2017, the
hotel is well positioned to continue its strong
performance with its refreshed room stock.
- Plans are also in progress to upgrade guest lifts
and refresh SPAK's conferencing and banqueting
facilities. When all upgrading is completed,
overall guest experience will be enhanced and
SPAK's position as the choice hotel in Auckland
will be strengthened.
- Property development segment revenue declined
56% in FY2016 on absence of a one-off divestment
of Dulwich Hill.
- This, despite the Group having sold the three
remaining units at The Stamford Residences &
The Reynell Terraces, including a penthouse that
fetched a record selling price.
- Four more units at The Stamford Residences
Auckland were sold and ongoing marketing
efforts continue for the remaining seven units.
- Last year, it was reported that some 142 units at
Macquarie Park Village were under reconsideration
as development application approval for a portion
of the carparks was not granted. Most owners
have retained their units, given the significant
increase in valuation since launch.
- The Group has applied for an additional 60
apartments to be added to the Melbourne Tower,
bringing the total number of apartments within
the development to over 700 units.
- Construction for Macquarie Park Village is ahead of
schedule. The Group is hopeful of early completion
for some units in 1H2017. The remaining project is
scheduled to complete in 2018.
- The Group made a significant fair value writedown
of S$23.4 million for Dynon's Plaza, owing
to the depressed Perth market. There is, however,
a four-year tenancy remaining and the property
will continue to post stable rental income.