Singapore tycoon plans more Australian hotels

“We are focusing very much in Australia. We have heavily invested about $1.5 billion,” the Singaporean-based executive chairman of M&L Hospitality tells The Weekend Australian.

“The bottom line is Australia probably has lower margins relative to holding costs and yields,” says the 73-year-old, a former shipping magnate who began building his hotel portfolio in 2009.

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It is also difficult finding good hotel sites in Sydney given buyers wanted to buy low and sellers typically want to sell high. “That makes it more difficult,” he says.

“It’s hard to buy around Australia unless you go to Darwin or somewhere less popular with tourism,” he says.

The West Hotel in Sydney is part of Hilton’s Curio collection.

“We only have one or two projects we are working on at the moment in Australia,” Kum says, adding that Australia has the bulk of M&L’s hotels, which are spread from Britain to The Netherlands, New Zealand and Singapore.

In Sydney on Friday, Kum opened the new West Hotel, which is managed by Hilton as part of its Curio Collection, with the property just a few doors down from his 892-room Hyatt Regency in Sussex St that recently underwent a $250 million extension.

M&L Hospitality also owns the Swissotel in Sydney’s Market St, the Novotel in Perth and the Double Tree by Hilton in Melbourne’s Flinders St, but Kum stresses that Sydney and Melbourne will be his key focus for hotel acquisitions from now on, given the numbers of tourism arrivals and the extent of business activity in both cities.

Meanwhile, the Washington DC-based Curio Collection global head Mark Nogal says the boutique West Hotel is the first Curio Collection to open in Australia, but that several more are planned here.

M&L Hospitality executive chairman Michael Kum in Sydney. Picture: John Feder.

Although the brand was launched by Hilton only 3½ years ago, there are now 46 Curio Hotels around the world with the brand similar to Hilton rival Marriott’s Autograph.

Nogal says he is working with M&L Hospitality on a couple of deals in Australia, and has a couple of opportunities with some local developers.

He says the Australian market has always been popular, with Sydney one of the best cities to visit.

“I think the market has tremendous potential,” Nogal says.

The 182-room West Hotel Sydney, Curio Collection by Hilton, was developed on a former electrical substation within 13 months.

Billed as a “upper upscale” property, the hotel is expected to appeal to corporate travellers and the leisure market on weekends. It is run by Jane Lyons, the former general manager of the Langham Hotel in London.

Rates start at about $300 a night. M&L paid $22.5 million for the site at 65-79 Sussex St in early 2016.

This article originally appeared on www.theaustralian.com.au/property.