With the completion and recent launch of the Microtel by Wyndham Wellington Central, Stonewood Group's fifth hotel, Executive Director Michael Chow is looking to expand the commercial building arm of Stonewood Group, with a new project about to commence in Auckland's CBD and preliminary planning underway for two more properties in Wellington.
"Tourism is a key contributor to the New Zealand economy, and our goal is to have a hotel property in each major New Zealand city," said Chow. "With the phased border opening, tourism is back on track and is a lucrative sector for investors, and we plan to grow this aspect of our development by another 15 percent over the next three years."
Michael and John Chow
Chow and his brother John made their first foray into hotels in 1999 with the purchase of their first commercial property, the old ANZ building at 73 Courtenay Place, Wellington.
"We had the vision to add an additional three levels to the building and open a 75-room hotel. However, the development cost did not stack up, and with interest rates at 18 percent per annum, we decided the project was too much of a financial risk."
The brothers remained committed to breaking into the hotel sector, opening their first hotel development, the Just Hotel Wellington, in 2004.
"It was an old AA office building, and we converted it into a 60-room 4-star hotel. It was a steep learning curve, but we achieved 70 percent occupancy in the first year."
Since then, the Stonewood Group have completed four more hotels - Park Ave Residence Auckland (2014), Oaks Hotel Wellington (2019), Pullman Hotel Rotorua (2020) and the latest, the Microtel by Wyndham Wellington Central. Chow said the hotel development business was not without its challenges.
"Our fourth hotel, the Pullman Hotel Rotorua, opened in March 2020 and weeks later, New Zealand went into lockdown, which was an extremely challenging time for our business, as we had to temporarily close a brand-new hotel and hibernate during the COVID period. However, with the recent border opening, the Pullman is now in a profitable stage."
Stonewood Group's next project is revamping 280 Queen St, Auckland and adding five levels to the mixed-use office and retail development.
"Our next hotel property development will be in Christchurch by the famous international golf course, and we're also in the preliminary planning stage for two commercial projects in Wellington."
The Stonewood Group has a total asset value of $800 million. It boasts a portfolio of hotels and commercial buildings and owns the businesses Stonewood Homes, RCR Infrastructure, Dataguard, Urban Hub and Exodus.
Last year the Stonewood Group announced it had formed a partnership, Stonewood Key Capital, with family property development company, MTK Capital, led by former Prime Minister Sir John Key and his son Max.
