In a strategic move to fortify its presence in the United Kingdom, S Hotels and Resorts PCL, a distinguished hospitality investment and management enterprise and the hospitality subsidiary of Singha Estate PCL, recently unveiled the latest phase of its “3P” (Profit, Portfolio, Planet) strategy.
This initiative encompasses extensive renovations at various hotels in pivotal cities, including the Mercure Manchester Piccadilly Hotel, Mount Royal Hotel Edinburgh, and The Grand Hotel Leicester, coupled with substantial upgrades at an additional eight establishments.
The United Kingdom holds a prominent position as S Hotels & Resorts’ largest market, housing a remarkable 65% of its global room portfolio. Currently boasting 27 hotels featuring 2,940 keys nationwide, this conglomerate operates under renowned brands like Mercure and Holiday Inn. These hotels are strategically located across prime business and leisure destinations throughout the UK.
Under the “Portfolio” segment of the “3P” strategy, which prioritizes asset rotation and enhancement, S Hotels & Resorts aims to maximize its UK assets. This is achieved through the divestment of underperforming properties and subsequent reinvestment of funds, backed by an additional injection of approximately GBP 16 million (equivalent to USD 20.1 million). These funds will facilitate the renovation of high-potential assets, with the anticipated outcome being an occupancy rate exceeding 75% and a 10-15% increase in the average daily rate (ADR) for these properties.
Strategic Acquisitions and Disposals
In 2021, S Hotels & Resorts secured an additional 50% stake in 26 of its UK hotels. Furthermore, the company recently executed the head lease acquisition of the 76-key Mercure Perth Hotel in Scotland, as part of its efficiency enhancement strategy in the UK. Additionally, the group divested three properties, namely the Mercure Newbury Elcot Park Hotel, Mercure Burton upon Trent Newton Park Hotel, and Mercure London Watford Hotel.
S Hotels & Resorts now embarks on the next phase of their asset enhancement strategy across key UK assets. A major renovation is currently underway at the Mercure Manchester Piccadilly Hotel, a 280-key landmark situated in the heart of Manchester. This renovation encompasses upgrades to guest rooms, corridors, and the lobby area, solidifying the property’s position as a premier destination for leisure breaks and events in Manchester.
At the Royal Mount Edinburgh City, boasting 169 keys and a prime location in the historic heart of Scotland’s capital, renovations extend to guest rooms, the lobby, corridors, and façade. The popular restaurant, Scott’s on Princes Street, will also undergo transformation. This renovation will elegantly capture the essence of Edinburgh, drawing inspiration from the city’s colour palette in Princes Street Gardens and its rich literary history.
The Grand Hotel Leicester, a 104-key gem within a stunning Grade II listed Victorian building, will also undergo a comprehensive renovation project, encompassing guest rooms and public areas.
S Hotels & Resorts has recently completed the leasehold acquisition of the 91-room Mercure Glasgow City Hotel for GBP 7.5 million, unlocking the hotel’s full potential. Future plans include a renovation of rooms and public areas in 2024.
Modernizing the Guest Experience
In tandem with the physical upgrades, S Hotels & Resorts has invested in enhancing the IT infrastructure of its UK portfolio, aimed at optimizing guest experiences and driving operational and commercial efficiencies.
Mr. Dirk De Cuyper, CEO of S Hotels & Resorts, expressed his enthusiasm, stating, “The UK is an essential market for S Hotels & Resorts, and we are excited to embark on this latest phase of our portfolio enhancement strategy. The hotels we are renovating occupy prime locations within key business and leisure destinations, making them invaluable assets. These enhancement projects are poised to unlock their full potential. Looking ahead, we will continue to refine our portfolio, capitalizing on the resurgent tourism and hospitality sectors in the UK and globally while bolstering our revenue.”
Presently, the group manages an impressive array of 38 hotels and resorts, comprising 4,552 keys across five countries: the UK, Thailand, Maldives, Mauritius, and Fiji. Through the “3P” strategy, S Hotels & Resorts is poised to maintain its position as the second-largest Thai hotel operator in terms of revenue for the second consecutive year.