Starwood to spend $600 million in Australia08 August 2012
Starwood Hotels and Resorts says the time is right to spend $600 million on new hotels in Australian capital cities in the next few years, with plans for up to 12 new properties.
The US hotels giant says it is targetting up to 10 mid-tier properties on city fringes plus two five-star hotels in the mining capitals of Brisbane and Perth, the latter city particularly suffering from a shortage of rooms currently.
Starwood estimates each city fringe hotel will cost around $40 million to develop, while the five star hotels will cost around $100 million each. The company wants to sign management contracts of up to 20 years on each property and has confirmed it does not want to take an ownership stake.
"We are talking to a lot of developers to build these hotels," said Andrew Taylor, Starwood director of acquisitions and development.
"The players in that space are well capitalised, sometimes high net worth individuals or syndicates, and they are not reliant on any bank funding."
The expansion is expected to see the first Aloft and W brand hotels in Australia.