Asset enhancement work to run throughout 2023 and early 2024 at several major city centre hotels with high potential, as part of effort to maximise the performance of important assets in the UK.
S Hotels and Resorts PCL , the hospitality arm of Singha Estate PCL (SET: S), has announced the latest phase of its “3P” (“Profit, Portfolio, Planet”) strategy in the United Kingdom, with significant renovations at several hotels in key cities, including Mercure Manchester Piccadilly Hotel, Mount Royal Hotel Edinburgh, and The Grand Hotel Leicester, plus extensive upgrades at another eight hotels.
The UK is S Hotels & Resorts’ largest market, accounting for 65% of the rooms in its global portfolio. The company currently has 27 hotels comprising 2,940 keys nationwide, operating under world-renowned brands including Mercure and Holiday Inn, and situated in leading business and leisure destinations across the country.
Under the “Portfolio” section of the “3P” strategy, which is focused on an asset rotation and enhancement program, S Hotels & Resorts is maximising its UK assets with the divestment of underperforming properties and the reinvestment of funds – supplemented by additional investment of around GBP 16 million (approx. USD 20.1m) – in the renovation of assets with high potential. This is expected to result in an occupancy rate of more than 75% and a 10-15% ADR increase for these properties.
In 2021, S Hotels & Resorts purchased additional 50% stakes in 26 of its UK hotels, and the company recently completed the head lease acquisition of the 76-key Mercure Perth Hotel in Scotland, as part of its efficiency improvement strategy in the UK. It has also disposed of three properties: Mercure Newbury Elcot Park Hotel, Mercure Burton upon Trent Newton Park Hotel, and Mercure London Watford Hotel.
S Hotels & Resorts is now embarking on the latest stage of their asset enhancement strategy in several key assets in the UK. A major renovation has now commenced at Mercure Manchester Piccadilly Hotel, the 280-key landmark hotel in the heart of this major city, including upgrades to its guest rooms, corridors and lobby area. This project will reaffirm the property’s position as one of Manchester’s leading hotels for leisure breaks and events.
At the 169-key Royal Mount Edinburgh City, which commands a prime location in the historic heart of Scotland’s capital city, overlooking Edinburgh Castle, the renovation will encompass the hotel’s guest rooms, lobby, corridors and façade, as well as Scott’s on Princes Street, the popular restaurant. Infused with the vintage charm of Scottish culture and surrounding architecture, this transformation will aim to tell the story of Edinburgh by incorporating the colour palette of Princes Street Gardens and capturing the city’s literary history.
The Grand Hotel Leicester is a 104-key property which is set in a stunning Grade II listed Victorian building, located close to the Cultural Quarter in Leicester’s vibrant city centre. A renovation project will now be undertaken that encompasses the hotel’s guest rooms and public areas.
S Hotels & Resorts also recently completed the leasehold acquisition of the 91-rooms Mercure Glasgow City Hotel for GBP 7.5 million, which will help to unlock the hotel’s full potential. This will be followed by a renovation of the rooms and public areas in 2024.
In parallel with the upgrades being made to its bricks & mortar assets, S Hotels & Resorts has invested in the improvement of the IT infrastructure of its UK portfolio, to optimise its guest experiences and drive operational and commercial efficiencies.
Dirk De Cuyper, CEO of S Hotels & Resorts, stated: “The UK is an important market for S Hotels & Resorts, so we are excited to move ahead with this latest phase of our portfolio enhancement strategy. The hotels we are renovating command prime locations within key business and leisure destinations. This makes them important assets and these enhancement projects will help to maximise the hotels’ potential. Moving forward, we will continue to optimise our portfolio and take advantage of the rapid recovery of tourism and hospitality in the UK, and around the world while boosting our revenues.
At present, the group has 38 hotels and resorts comprising 4,552 keys in five countries: the UK, Thailand, Maldives, Mauritius and Fiji. Through the “3P” strategy, the company is expected to retain its position as the No.2 Thai hotel operator in terms of revenue for the second consecutive year.