By Martin Kelly
IF passion was petrol, Nick McCaw would be on the moon right now. Instead, he remains on planet earth as the driving force behind Hotel SO, a budget hotel brand that has just launched with a single property in occasionally hip Christchurch, New Zealand. But that won’t be the case for long, the Blackberry addicted McCaw, who has embraced multi-tasking as a religion, told the No Vacancy conference. The plan is to take Hotel SO to the world, and Australia is first in line.
The concept is basically small high-quality rooms (11sqm in some cases) costing from just $NZ69 packed with the latest technology and features such as 26 inch LCD televisions. There’s also free wireless internet throughout the 283 room (134 of which don’t have a window) property plus a café, gym etc. Great facilities, low price – get it!
Sleepy or not, Hotel SO has shaken up the Christchurch hotel market. During March its occupancy was 92.8% compared with the city average of 75.5%, the average rate was NZ$82 (NZ$153.76 city average), 52% of bookings through the Internet, and 21% of all bookings from own website. He is also claiming room operating costs are 38% less than the average in an industry he described as “big, old, slow and lazy” with the total cost of having a room occupied just NZ$20.
McCaw has started meeting the local investment banking community and you get the feeling they might like the economics – the Christchurch property was a NZ$40m refit of an existing building – although high land and building costs may be barrier to entry in this market, particularly in the major CBD markets. Secondary cities may also be an option. One thing is for sure, McCaw will not die wondering. Travel Trends: April 22, 2008