New Zealand's second biggest privately-owned motel and hotel chain has been placed on the market for sale.
The SilverOaks Group - owned and operated by Auckland-based businessman Dennis Wilson, his wife Dawn, and their son Greg - features six large accommodation providers in Auckland, Rotorua and Wellington.
The family has been in the hospitality and accommodation industry for some 40-years but are selling up to retire. The portfolio - valued at a combined worth of approximately $40million - includes:
The SilverOaks Geyserland in Rotorua - a 68 room property overlooking the touristy Whakarewarewa Thermal Valley, and operating under the Quality Hotel brand.
The SilverOaks Resort Heritage ion Rotorua - a 41 room apartment style complex supported by a range of leisure activities and amenities.
The Gwendoline Court Motel in Rotorua - an 18 unit business close to the city's Maori arts and crafts attraction.
The Oakwood Manor Motor Inn in Auckland - a 53 unit conference and function venue.
The SilverOaks Inn Silver Point in Auckland - a 35 room conference and meeting location.
The SilverOaks Hotel in Wellington - a 64-room close to the city's botanical gardens, operating under the Quality Hotel brand.
The properties are being sold by Bayleys - either as one combined portfolio, or as individual locations - through a tender campaign running until August 2. The marketing campaign is being headed up by Paul Dixon and Mike Peterson of Bayleys Auckland, with local representation from Mark Slade in Rotorua and James Higgie in Wellington.
Paul Dixon said the hotels operated in a mix of leisure and corporate markets, and were believed to be the second largest privately-owned portfolio of large accommodation providers in New Zealand after the Scenic Circle group of hotels.
"The leisure amenities within the SilverOaks hotels and motels feature swimming pools, spa and sauna rooms, tennis courts, BBQ areas, children's playgrounds and mini-putt golf courses. Conversely, the more corporate-focused properties have conference and meeting break-out rooms more suited for functions," he said.
"The chain's Rotorua sites lean toward the leisure market, while the Auckland and Wellington operations are more corporate focused.
"All of the properties have licensed food and beverage operations delivering restaurant and bar options, function catering, or in-room dining.
"Tariffs for all properties within the SilverOaks group are firmly in the mid-range bracket commensurate with three-star rated hotels. With refurbishment and reclassification into the four-star bracket, there is obvious potential for yield growth."
Mr Dixon said most of the hotels were in a fairly 'tired' stage of their lives, and varying degrees of investment would be needed to restore them to former glories and modern interior d�cor - both in the bedrooms, and the communal areas. However, he said the vendors' price expectations would reflect this.
"The tourism sector, as with most parts of the domestic economy, has been 'doing it tough' over the past few years, so operational budgets within the chain have been funneled into underpinning frontline services," Mr Dixon explained.
"The opportunity exists now for an investor to purchase a substantial chain in one go to either add to any existing properties, or to establish a footprint in the New Zealand market from which growth can be launched.
"There are obvious cost efficiencies within the group as it stands - through the like of supply contracts, personnel flexibility to smooth out labour requirement peaks and troughs, and back-office management systems.
"Most of the hotels were built during the 1980s and are of sold construction, with the Wellington property dating back to the mid-1960s. The portfolio was carefully acquired because of the properties' locations delivering high visibility to passing traffic."
The two Auckland properties are located near Auckland International Airport south of the city, and are often used for 'hub' conferences - with delegates flying in from around various New Zealand locations first thing in the morning, conducting business during the day, then having delegates catch flights homes early to mid evening.
Alternatively to running the sites purely as accommodation providers, Mr Peterson said the diversity of the SilverOaks portfolio opened up a range of opportunities within the various individual properties - such as expansion in some locations, or non-competing development or divestment at others, subject to management contracts with the Quality Hotel group.
"The Oakwood Manor in Auckland for example comes with a substantial land holding which has the potential for a 30-plus residential subdivision on one side, and possible retail development across a high profile intersection on the other," Mr Peterson said.
"SilverOaks Geyserland in Rotorua has capacity for the building of additional rooms, while the Wellington property could be converted into a residential complex with retail outlets in the lower level."
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