THE VALUE WE CREATE - PPHE Hotel Group
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INVES TMENT OUR PROPOSITION PUR POSE Asset value growth Creating valuable memories for We develop our own assets and have grown our EPRA NAV per our guests and value for our assets, share by 300% over the past people and local communities. decade. EPRA NAV per share at 31 December 2019 was £25.46 WHO WE ARE Operating earnings PAGE 4 PAGE 8 PAGE 10 Adjusted EPRA earnings per share We are an international hospitality group About us Chairman’s 30 years of for the 12 months to 31 December with a strong prime real estate portfolio 2019 at 128 pence statement PPHE Hotel Group consisting of 45 properties under operation Healthy leverage in five countries, that transforms an asset’s Net bank debt leverage ratio of 29.4% as at 31 December 2019 potential into value and profits. and our growth since IPO has been funded without diluting WHAT WE DO THE shareholders Progressive dividend policy We have a clear strategy to drive VA LU E Dividend has grown with a 16.6% growth and create long‑term value while CAGR over the past five years (excluding special dividend of recognising and developing opportunities WE £1 per share in 2016). The total to help our assets reach their full potential. ordinary dividend for the year ended 31 December 2019 is We delight our guests every day, through engaging service and quality products C R E AT E 37 pence per share, representing a year-on-year growth of 5.7% in inviting places. Attractive pipeline PAGE 12 PAGE 2 2 Attractive development pipeline HOW WE DO IT in Hoxton London, New York City, President & Driving Belgrade and Zagreb By valuing our people, being led by an Chief Executive organic growth Officer’s statement entrepreneurial Board and through investing in our portfolio, opportunities with upside potential and local communities. PAGE 24 PAGE 28 PAGE 3 2 Holmes Arena Kažela Pipeline Hotel London Campsite for the future
S T R AT E G I C R E P O R T S T R AT E G I C R E P O R T C O R P O R AT E G O V E R N A N C E F I N A N C I A L S TAT E M E N T S APPENDICES HIGHLIGHTS T H E VA L U E W E C R E AT E £357.7m £122.9m £40.7m TOTAL E B ITDA N O R M ALI SED R E VENUE PRO FIT B EFO R E TA X We create memorable guest 107.3 113.2 122.9 experiences by owning, developing and 80.1 94.1 operating hotels and resorts in dynamic, vibrant cities and leisure destinations. Our properties are managed by 2015 2016 2017 2018 2019 experienced teams living our values £1.7bn £25.46 800+ every day, creating unique experiences. PRO PE R T Y EPR A N AV PI PELI NE PE R SH A R E RO O M S We create stakeholder value at every step of the value chain as our properties provide attractive returns, strong cash flow generation and long-term capital appreciation. 4,700+ £128.5 £103.6 S T R AT E G I C R E P O R T 2 4 Financial highlights About us: creating value CO R P O R AT E G OV E R N A N C E 90 Non-Executive Deputy Chairman’s Corporate Governance Statement 135 Consolidated statement of cash flows 137 Notes to consolidated financial statements 6 Strategic canvas 92 Board of Directors TE A M MEM B ER S AVE R AGE R E V PA R 8 Chairman’s statement 94 Leadership Team A PPE N D I C E S RO O M R ATE 10 30 years of PPHE Hotel Group 96 Corporate Governance 175 Subsidiaries included in the Group 12 President & Chief Executive 111 Nomination Committee report 178 Jointly controlled entities Officer’s statement 113 Audit Committee report 178 Current and committed projects 18 Our business model and priorities 116 Directors’ Remuneration report 179 Glossary 20 The value we create 122 Directors’ report IBC Contacts 36 Strategy at a glance 38 Managing risk F I N A N C I A L S TAT E M E N T S 42 Principal risks and uncertainties 128 Independent auditors’ report 47 Viability statement 131 Consolidated statement 48 Key performance indicators of financial position 50 Chief Financial Officer’s review 132 Consolidated income statement 62 Deputy Chief Executive Officer & 133 Consolidated statement of Chief Operating Officer introduction comprehensive income 64 Business review 134 Consolidated statement of changes 73 Stakeholder engagement in equity 80 Responsible business P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 1
S T R AT E G I C R E P O R T S T R AT E G I C R E P O R T C O R P O R AT E G O V E R N A N C E F I N A N C I A L S TAT E M E N T S APPENDICES FINANCIAL HIGHLIGHTS FI N A N C I A L H I G H L I G H T S TOTAL REVENUE DIVIDEND PER SHARE £m Pence 37 341.5 357.7 35 325.1 272.5 24 3.1% 21 CAGR 16.6% CAGR 1 20 218.7 £357.7m 2015 2016 2017 2018 2019 37p 2015 2016 2017 2018 2019 EBITDA O P E R AT I N G H I G H L I G H T S £m 122.9 113.2 107.3 OCCUPANCY 94.1 CAGR 11.3% % 84.3 79.4 80.6 80.1 76.0 77.3 £122.9m 2015 2016 2017 2018 2019 NORMALISED PROFIT BEFORE TAX 80.6% 2015 2016 2017 2018 2019 £m 40.7 37.7 AVERAGE ROOM RATE 31.7 32.1 29.8 CAGR 8.1% £ 120.2 123.1 128.5 109.1 111.0 £40.7m 2015 2016 2017 2018 2019 ADJUSTED EPRA EPS £128.5 2015 2016 2017 2018 2019 Pence 128 115 97 104 REVPAR 96 .3% CAGR 7 £ 97.7 103.6 92.0 92.9 84.4 128p 2015 2016 2017 2018 2019 £103.6 2015 2016 2017 2018 2019 Read more – pages 48 and 49 P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 2 3
S T R AT E G I C R E P O R T S T R AT E G I C R E P O R T C O R P O R AT E G O V E R N A N C E F I N A N C I A L S TAT E M E N T S APPENDICES A B O U T U S : C R E AT I N G VA L U E BUSINESS MODEL VALUE SPLIT BY GEOGRAPHY 1 HOTELS AND RESORTS BY GEOGRAPHY HOTELS AND RESORTS BY OWNERSHIP TYPE (Excludes managed, operated, leased, (Includes franchises, excludes campsites (Includes franchises, excludes campsites At PPHE Hotel Group, we are focused WE (RE)FINANCE TO FUND WE franchised and co-owned hotels) and pipeline) and pipeline) on creating value for stakeholders FURTHER INVESTMENTS PURCHASE through developing, owning and operating hospitality real estate with upside potential. We own or co-own most of our portfolio and our proven business Creating model is centred around delivering asset value appreciation, stakeholder generating attractive operating returns and creating valuable value memories for our guests. We are proud of our track record. Our experienced senior leadership team identifies and acquires £969m £145m 10 hotels 8 hotels 18 hotels 2 hotels properties which we believe have significant upside potential. United Kingdom Croatia hotels 3,681 rooms 1,271 rooms 6 resorts 242 rooms We then embark on transforming these assets through (re) and resorts United Kingdom Germany 5,925 rooms Co-owned and Hungary Freehold developing, redesigning and continuously improving operating WE BRAND £297m £99m performance through our in-house management platform, and PROPERTIES The Netherlands Croatia 6 hotels 7 hotels 6 hotels 5 hotels WE AND IMPROVE DEVELOP campsites 1,073 rooms 6 resorts 1,623 rooms 1,010 rooms in doing so create significant value along every part of the value OPERATING The Netherlands 2,775 rooms Long leasehold Managed, PERFORMANCE chain. Through refinancing our properties, we are able to release £94m £99m Croatia operated, capital for new investments, enabling further Germany Assets under leased or and Hungary development2 franchised sustainable growth. Read more – page 18 and 19 1 The fair values were determined on the basis of independent external valuations prepared in the summer of 2019. 2 Includes the development sites in Hoxton, London and nearby Waterloo Station. PR IME LOC ATIONS Independent hospitality real estate owner and operator with brand flexibility and access to global brands and distribution network Within the Group we have the ability and flexibility to select the right brand to complement our hospitality assets. We have an exclusive Well-maintained, prime assets, with proximity to major demand generators within leading capital cities, urban markets and perpetual licence with Radisson Hotel Group to operate the upper upscale Park Plaza® brand in Europe, the Middle East and Africa and resort destinations. which complements our wholly-owned upper upscale lifestyle brand, art’otel® and Arena Hotels & Apartments® and Arena Campsites® brands which are operated by Arena Hospitality Group, our Croatian listed subsidiary. inspiring service, stylish Central reservation guestrooms and versatile meeting and distribution facilities, which are complemented system by award-winning restaurants and bars. Our portfolio of vibrant Radisson Hotel Group Park Plaza city-centre hotels and tranquil Radisson Hotel Group has seven Park Plaza is an upscale and beachside resorts in Croatia owerful online and P already presents a wide choice distinctive hotel brands with more mobile platforms upper upscale contemporary than 1,400 hotels in operation and hotel brand featuring individually of locations and accommodation, Park Plaza Westminster Bridge London Park Plaza London Waterloo Park Plaza London Riverbank Holmes Hotel London development in destinations across designed hotels in vibrant and we are committed, with our Opposite Big Ben on the thriving South Bank Close proximity to Waterloo Station Between Waterloo Station and Nine Elms/ On Chiltern Street, close to Marylebone Village, the globe. Its portfolio of hotel city-centre locations and select partner Radisson Hotel Group, American Embassy Marylebone Station and Baker Street Station brands includes: Radisson Radisson RewardsTM resort destinations. The Park Plaza to bringing Park Plaza to even 1,019 rooms 494 rooms 646 rooms 118 rooms Collection™, Radisson Blu®, programme with brand is renowned for creating more locations. Radisson®, Radisson RED®, Park 24 million members memorable moments through Plaza® and Park Inn® by Radisson®. Country Inn & Suites by Radisson. Radisson Hotel Group is part of Jin Global sales, Jiang and together they form the marketing world’s second largest hotel group and buying power in terms of rooms. Art and culture are ingrained Arena Hotels & Apartments Park Plaza Victoria Amsterdam art’otel amsterdam Park Plaza Nuremberg art’otel cologne in every aspect of the art’otel® A collection of hotels and Opposite Amsterdam Central Station Opposite Amsterdam Central Station Opposite Nuremberg’s main railway station Located in the attractive Rheinauhafen area brand. Knowledgeable and self-catering apartment 298 rooms 107 rooms 177 rooms 218 rooms passionate team members complexes offering relaxed share their enthusiasm while and comfortable accommodation simultaneously delivering within beachfront locations across art’otel world-class service, creating Arena Hospitality Group the historical settings of Pula and art’otel is a contemporary collection a superior guest experience. Our subsidiary Arena Hospitality Medulin in Istria, Croatia. of upper upscale lifestyle hotels that Group (Arena) is a leading fuse exceptional architectural style art’otel has three exciting dynamic hospitality group in Arena Campsites with art-inspired interiors. Located in new projects in the development Central and Eastern Europe. Situated close to the historical cosmopolitan centres across Europe, pipeline. Two are in London, with towns of Pula and Medulin, each each hotel displays a collection of one hotel set to open in Hoxton and campsite provides a relaxed original works designed or acquired one as part of the Battersea Power environment from which guests specifically for each art’otel, with Station development, and a third in can experience Istria’s areas of Park Plaza Amsterdam Airport Park Plaza Belvedere Medulin Park Plaza Histria Pula Arena One 99 each property offering a unique art New York City, USA. natural beauty and enjoy outdoor Close proximity to Amsterdam Schiphol Airport Iconic leisure and sports hotel Dramatic beachfront setting Croatia’s first all-glamping offering gallery. art’otel has created a niche for activities from April to October. 342 rooms 427 rooms 369 rooms 193 luxury tents itself in the hotel world, differentiating Each campsite provides a distinctive it from traditional hotels. offering, from traditional camping to a luxury ’glamping’ offer. P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 4 5
S T R AT E G I C R E P O R T S T R AT E G I C R E P O R T C O R P O R AT E G O V E R N A N C E F I N A N C I A L S TAT E M E N T S APPENDICES S T R AT E G I C C A N VA S OPER ATING ACROSS THE VALUE CHAIN PPHE Hotel Group operates a highly control all aspects of its guest offering, differentiated business model to peers, whilst retaining all of the economic upside. who are increasingly focused on either the By contrast those offering either an asset property or operational aspects of the light or asset heavy model relinquish some hotel value chain. With in-house expertise control of the guest experience as well as across the value chain, PPHE is able to pay away fees to third parties. 0% 100% Site Development/ Hotel Hotel Hotel Brand Asset Extracting Reinvestment/ acquisition repositioning ownership operation management management value cash recycling TOTA L VA LU E CH A I N Independence Optimise timing (Re) finance with Re-invest Secure best locations and control over and control, Ensure consistency of brand standards and guest service B US I N E SS M O D E L B E N E FI T S to refurbish asset backing to extracted cash to all aspects of the hotel design no conflict levels are maintained throughout the estate and reposition extract value enable further growth of interest Net operating S H A R E H O LD E R Value gains through development Rental income and profit from Fee-based income as a % of revenue and profit Value gains Source for funding future growth VA LU E PR O P OS I T I O N and repositioning value appreciation rooms, food & beverage T Y PI C A L A SSE T- LI G H T M O D E L A D O P TE D BY Management Franchise agreement L A R G E H OTE L G R O U P S Asset operated agreement to earn (or the usage of a under operational a fee based income as brand, income as a % lease agreement a % of revenue of revenue) and profit T Y PI C A L A SSE T- H E AV Y M O D E L Asset owned Asset owned but and leased to managed by Sale of asset third party third party P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 6 7
S T R AT E G I C R E P O R T S T R AT E G I C R E P O R T C O R P O R AT E G O V E R N A N C E F I N A N C I A L S TAT E M E N T S APPENDICES C H A I R M A N ’ S S TAT E M E N T E L I PA P O U C H A D O Thirty years in the making We own most of the properties we operate, track record as a Non-Executive Director Current trading and outlook Thirty years ago the foundations of the which gives us greater control over our with companies including FTSE 250 Trading in 2020 has started well and in CHAIRMAN investment strategy, the quality of our constituent Vistry Group. Company were formed with the opening line with the Board’s expectations, as we of our first hotel in Eindhoven, the products and our operations. continue to capitalise on recent investment Following appointment and Nigel Jones Netherlands in 1989. It is a proud moment for Control enables us to make swift investment retiring, following the forthcoming Annual programmes to reposition properties in T H E VA LU E me personally and a credit to the expertise decisions and seize opportunities as they arise, General Meeting, the Board will include three the UK, the Netherlands and Croatia. In the and dedication of the entire team that the as well as capturing all of the economic upside. independent Non-Executive Directors. coming year, we will continue to ensure we Group has consistently grown over the last By regularly investing in our existing diverse have an attractive and well-invested estate three decades. Today, the Group has an As previously announced, Kevin McAuliffe’s which delivers memorable experiences for portfolio we maintain a high quality estate W E C R E AT E international property portfolio of 45 hotels, membership of the Audit Committee came our guests and returns for our shareholders. which increases the value of our portfolio resorts and campsites in operation, to an end at the Annual General Meeting in of assets, inspires our team members, and We remain vigilant to ongoing macro and predominately trading under the brands May 2019 and in November 2019 he stepped enables us to delight our guests every day geopolitical uncertainty and its potential of Park Plaza and art’otel, as well as an down from the Remuneration Committee with excellent guest experiences. impact on travel patterns, however the exciting £300 million plus development after a transitional period. Board believe that recent investments pipeline for future growth. Responsible Business Improving our transparency and reporting across the estate and a balanced Our sustainable business strategy standards is part of our journey as a The quality of our property portfolio was £300 million plus development pipeline is focused on our people, our places and Company. We are actively working on confirmed in an independent valuation by spanning the UK, Europe and the US, our planet. Since launching our Responsible creating greater transparency in our Savills and Zagreb Nekretnine Ltd (ZANE) combined with a strong balance sheet Business programme two years ago, we have governance activities, as this report in summer 2019 at £1.7 billion, translating to means the Group is well positioned for been embedding this ethos into our culture will illuminate. NAV per share of £25.46. future growth. We will also continue to and aligning it to our business strategy. We aim For more see governance page 90 consider asset acquisitions that align with Delivering for shareholders to have a target-based sustainable approach our strategic aims and deliver our target In 2019, we continued to make financial and have embed this at all levels across Diversity returns on investment. progress with like-for-like revenue and the Group. The Board is committed to promoting EBITDA up 5.2% and 3.4% respectively. I would like to take this opportunity to We understand that the way we do diversity. As this was our first year in the thank the members of the Board for their We have continued to deliver strong business can have a significant impact FTSE 250, we now take part in the Hampton- guidance. Additionally, I would like to thank returns for shareholders, achieving a Total on our communities and the world around Alexander Review. Our leadership, which all our team members for their hard work Shareholder Return of 13.8% for the year.1 us and that all of us have an increased includes the direct reports to the Chief and commitment during 2019. level of responsibility in this area. Executive Officer and their direct reports A further important milestone in the In recognition of this, we have assembled currently consists of 48% women and 52% I am confident that PPHE Hotel Group can Company’s evolution was reached in 2019 with a dedicated team to review our activities men. This is well ahead of the 33% target continue to create and deliver value for all the Group’s inclusion in the FTSE 250 Index. and refine our Environment, Social and and 27.9% achieved by the FTSE 250. our stakeholders in 2020 and beyond. As we continue to grow in size and stature, we Governance (ESG) frameworks. We have set recognise the need to further strengthen our up a programme to appoint a Responsible Dividend financial reporting, corporate communications The Board is proposing a final dividend Business Ambassador from every property and our governance, whilst staying true to our payment of 20 pence per share, bringing in our portfolio to promote and enhance entrepreneurial roots. the total ordinary dividend for the year ended our efforts across our estate. 31 December 2019 to 37 pence per share, Our approach Governance in action representing a year-on-year increase of 5.7%. E L I PA P O U C H A D O As an owner operator with extensive CHAIRMAN High standards of governance are development expertise we take a different This is in line with our progressive essential to creating long-term value for all approach to many of the large global hotel dividend policy and reflects the Board’s of our stakeholders. We are committed to companies, by choosing to operate across confidence in the Group’s operations, upscaling our corporate governance and the whole value chain. assets and prospects. sustainability programmes and recognise Our key sources of value emanate from our their increasing importance to our business. real estate and hospitality expertise, our As part of our ongoing succession planning access to global brands and distribution programme we promoted two senior systems, our passionate and highly-trained company executives into key leadership people and our proven financial strength, positions, while also refreshing the Board combined with our ability to secure capital. with the appointment of two independent SEC TI O N 172 Non-Executive Directors in September 2019 In accordance with the UK Corporate Governance Information about our stakeholders and on how As established hospitality operators we are Code 2018, which incorporates section 172 of the the Board has discharged its duties having always aiming for operational excellence. and February 2020 respectively. UK Companies Act 2006, and as a matter of regard to the provisions of the UK Corporate We are continuously seeking out and We were delighted to welcome Ken Bradley to good governance, in our decision-making the Governance Code 2018 is available as follows: evaluating new property opportunities, the Board as an independent Non-Executive Board considers the interests of the Group’s • Team Members as well as refurbishing and repositioning Director on 4 September 2019. Ken, who is a employees and other stakeholders and • Investors understands the importance of taking into • Guests our existing assets. With our expertise in former Chief Country Officer of both RBSI account their views and considers the impact • Local Communities development we are able to marry this with and Barclays Bank, is a member of the Audit of the Company’s activities on the community, • Affiliates the aspirations to create new opportunities. Committee, the Nomination Committee and environment and the Group’s reputation. In its • Suppliers Our owner operator business model enables the Remuneration Committee. decision-making, the Board also considers what is most likely to promote the success of the Read more about – How the Board is kept us to enhance value through driving the We have listened to the views of shareholders Company for its stakeholders in the long term. informed of stakeholder views and business and gives us greater scope to and delivered on our commitment to appoint consideration of views of stakeholders in maintain all our assets to the level required decision-making on pages 73 to 79 a further independent Non-Executive to achieve our aspirations of maximising Director. Post the year end, Nigel Keen has Read more about – How we manage our operational revenue. Furthermore, we have been appointed to the role. Nigel has over emerging and principal risks on pages 38 the asset backing to refinance and recycle to 41 30 years’ property expertise with leading capital to fund further investments blue chip companies and an established Read more about – Corporate and facilitate future growth. governance framework on page 90 1 Source: Bloomberg TSR for the year ended 31 December 2019. P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 8 9
S T R AT E G I C R E P O R T S T R AT E G I C R E P O R T C O R P O R AT E G O V E R N A N C E F I N A N C I A L S TAT E M E N T S APPENDICES 3 0 Y E A R S O F P P H E H OT E L G R O U P CELEB R ATING Established Park Plaza Company name Transfer to Premium Listing 30 Y E AR S Hotels Ltd and floated changed to PPHE Hotel of London Stock Exchange on AIM, raising Group to align with its Membership of European Public £85 million multi-brand strategy Real Estate Association, EPRA for expansion First three Park Plaza® Completion of seven storey Acquired worldwide branded hotels open extension and repositioning Group completes several art’otel® brand rights in Croatia following of Park Plaza London Riverbank development projects in redevelopment and full repositioning of Park central London, opening Plaza Victoria Amsterdam multiple hotels. Acquired controlling Launch of Arena One 99 an Expansion into Germany all-glamping product, the and Hungary, operating interest in Arena first repositioning of one several Park Plaza® Opening of Park Plaza of Arena’s campsites Park Plaza Westminster hotels and art’otels® Nuremberg developed Foundations of the Bridge London (1,019 Entered into a strategic by the Group Company were formed rooms) developed by the with the acquisition of its partnership with Carlson Group opens, as well as Start of multi-year first hotel in Eindhoven, (now Radisson Hotel Group) new openings in Cologne repositioning and the Netherlands for the Park Plaza® brand and Amsterdam investment programme 1989 1999–2002 2007 2010 2012 2016 2018 1993–1995 2003–2006 2008 2011 2013–2015 2017 2019 Inclusion in FTSE 250 and FTSE All Share indices Acquisition of first US site in New York City for Iconic Park Plaza London Secondary purchase Migrate from art’otel® development Riverbank developed by the offering in Croatia, AIM to the Main Group as well as openings in raising €106 mio (€91 mio) Completed repositioning Market of the London Leeds, Nottingham, Cardiff for expansion and programmes at Holmes Hotel Stock Exchange and other markets property upgrades London, Park Plaza Vondelpark, Amsterdam, Park Plaza Utrecht Acquisition of iconic Opening of newly and Arena Kažela Campsite Victoria Hotel Amsterdam developed Park Plaza and hotel in Utrecht. London Waterloo and Park Plaza UK awarded ‘Large Group’s hotels start using Park Plaza London Hotel Group of the Year’ Park Plaza® brand Park Royal accolade by the AA Enters resort segment of the hospitality market by acquiring a minority interest Opening of new hotels in and management including the first art’otel agreement for (what is developed by the Group known today as) Arena (the 5-star art’otel Hospitality Group, a Amsterdam) and a fourth 21-strong property portfolio Park Plaza hotel in Croatia P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 10 11
S T R AT E G I C R E P O R T S T R AT E G I C R E P O R T C O R P O R AT E G O V E R N A N C E F I N A N C I A L S TAT E M E N T S APPENDICES P R E S I D E N T & C H I E F E X E C U T I V E O F F I C E R ’ S S TAT E M E N T BORIS IVESHA Our 2019 financial results coupled of a 115-room hotel in Zagreb, Croatia. The annual independent revaluation exercise with our strategic progress demonstrates These agreements are in line with Arena’s on our property assets was carried out by PRESIDENT & CHIEF E XECUTIVE OFFICER the strength of our business model, the strategy to expand its presence in the Savills and ZANE and valued our portfolio appeal of our hospitality real estate Central Eastern European region and at £1.7 billion (as at 30 June 2019), an increase portfolio and our rigorous focus reduce seasonal exposure. of 5% year-on-year. EPRA NAV per share C R E AT I N G on performance, in what has been In London, the Group acquired a freehold increased by 3.6% to £25.46 per share (as a year characterised by high levels site on the South Bank, with a view to at 31 December 2019), adversely impacted of geopolitical uncertainty. developing a hotel (subject to planning). by the strengthening of Sterling. Adjusted EPRA earnings per share 2019 at a glance VA LUA B L E Further details on our progress are set out were up 11.7% to 128 pence. Strategic progress in the Business Review on pages 64 to 72, Full details of the financial performance We demonstrated our real estate expertise, and additional details of our investment are set out in the Financial Review on completing over £100 million of asset programmes and development projects MEMORIES pages 50 to 61. upgrade projects over the last three years. can be found on pages 32 to 35. The significant repositioning of Holmes Hotel Key corporate milestone London (formerly known as Park Plaza Financial delivery It is testament to the team that we delivered We achieved a key goal with the Company’s Sherlock Holmes London), Park Plaza inclusion in the FTSE 250 and FTSE All another year of growth in revenue and profit. Vondelpark, Amsterdam and Park Plaza Share Indices. This marked a significant Utrecht were completed and relaunched. The Group delivered like-for-like revenue milestone in our corporate journey, proving In Croatia, we finished the first phase of our up 5.2% to £355.8 million, like-for-like the success of our recent corporate activity, plans to transform Arena Kažela Campsite EBITDA growth of 3.4% to £117.4 million, which has been focused on providing the into an upscale camping offer. and maintained like-for-like EBITDA margin Group with the appropriate platform to at 33.0%. The ordinary dividend for the full engage with a wider potential investor These projects have all been completed, year increasing from 5.7% to 37p per share. base and improve share liquidity. and the rooms are now contributing to Group revenue. This performance reflected an increase The foundations of our success in our key operating metrics, with RevPAR As trading in these reopened properties Controlling the value chain growth of 6.0% to £103.6, driven by a continues to build, we are pleased with The Group’s strength is centred on our 120 bps improvement in occupancy their performance. expertise in both real estate development and 4.4% increase in average room rate. We have also expanded our pipeline of new and hospitality operations, built up over RevPAR growth was achieved in certain hotels and projects, extending our footprint the last 30 years. This dual approach regions, with the United Kingdom and into the USA and Serbia, and added to our gives us the flexibility and control to the Netherlands the stand-out performers, strong presence in London. The site in invest in our hospitality operation and achieving growth of 7.4% and 2.5% New York City has been acquired with the manage our assets to create maximum respectively. Both the United Kingdom intention of developing an art’otel branded value for all our stakeholders; team and the Netherlands benefited from hotel. Our Croatian subsidiary, Arena members, investors, guests, local our 2017 and 2018 openings and the Hospitality Group (‘Arena’) entered into an communities, affiliates and suppliers. completion of repositioning projects. agreement to acquire an 88-room, 4-star Property expertise hotel in Belgrade, Serbia and, post the In addition to the considerable property period end, Arena entered into a 45-year and development expertise on the Board, lease for the development and operation we have a dedicated in-house capability spanning development and technical services. We have the in-house expertise to take projects from conception through to operation. Park Plaza London Waterloo The team takes a disciplined and focused approach to asset management and identify opportunities to deploy capital to optimise the value in our existing portfolio, acquire further assets to drive growth and, where appropriate, extract value to fund longer- term sustainable growth. In our hospitality operations, we are focused on achieving operational excellence. We are continually trying to identify better ways of working, while also looking at how we can raise the already high levels of service for our guests. Our high Guest Rating Scores and healthy profit margins prove that the two are interrelated. P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 12 13
S T R AT E G I C R E P O R T S T R AT E G I C R E P O R T C O R P O R AT E G O V E R N A N C E F I N A N C I A L S TAT E M E N T S APPENDICES P R E S I D E N T & C H I E F E X E C U T I V E O F F I C E R ’ S S TAT E M E N T C O N T I N U E D Holmes Hotel London Our people and values Looking after our team In addition to our Croatian region, we have Our people and our values of Trust, We aim to create an open, fun and in-sourced housekeeping services at our Respect, Teamwork, Enthusiasm, inclusive working environment where UK hotels which has ensured we employ Commitment and Care are at the heart our people feel motivated and empowered. the right team members and that our high of our business success. We foster a high Team members are supported in their standards of service are maintained at our performing culture, led by our talented professional development and through properties. Similar to owning the property leadership team, in which engaged team our bespoke learning and development assets, this action was about giving us the members deliver best in class guest platform, you:niversity of which several control we need to ensure that the highest experiences, supported by high quality programmes in 2019 won awards and key standards are met. Following the success hotels and resorts. accolades, including Talent Development of this strategy, we are reviewing whether Team of the Year (Institute of Hospitality) to extend this approach to housekeeping We have refreshed our strategic purpose and Excellence in Promoting Careers and services in our other regions. to ensure that our strategic objectives and Excellence in Learning & Development (HR One of the challenges for the wider business culture are aligned. At the start in Hospitality). Our annual team member industry is attracting workers into major of the year we hosted an international survey measures the engagement levels cities where residential accommodation leadership summit themed ‘We Are of our team members and in 2019, we were and travel is costly, such as London. Creators’, the objective of which was to delighted that the engagement index To help address this issue, we acquired present our Company blueprint based score for the year was 84.4% (2018: 83.6%). a property in Chiswick Park (the Old on our owner/operator business model to more than 150 senior team members. Pressures on the hospitality labour Bakery) in summer 2019, which has rooms We set out how our culture and day-to-day market have been well publicised. to accommodate about 30 people who activities need to work together to deliver Like others operating in the sector, then commute to our properties on our corporate agenda, enhance guest having a highly engaged workforce and London’s South Bank. We are considering experience and deliver value to all attracting and retaining the right people the purchase of further properties to stakeholders. This Company blueprint are key priorities for us and crucial to our attract and retain the best people. has been rolled out across three out of long-term success. To tackle some of these On behalf of the Board, I would like to our four regions, supported by in-country challenges, we have progressed several thank all our team members for their training workshops. initiatives, alongside our award-winning ongoing hard work and commitment. bespoke learning and development First class leadership team programmes, to ensure that we We have a wealth of talent within the can attract and retain the right people. Group. Our Executive Leadership Team has decades of experience in the hospitality real What we do Radisson Hotel Group Through our partnership with Radisson estate industry, with all of the team rising Hotel Group, we have benefited, particularly through the ranks of the Group. They define partnership – global distribution and disseminate the Company’s vision for over the summer of 2019, from a number of We identify and acquire and access to best in class technology focused investment programmes future growth and success. technology properties which we Through our exclusive perpetual licence including the launch of radissonhotels.com in July 2019. This is a multi-brand and mobile- Our success and ambition are underpinned by our strong leadership team and culture believe have significant from Radisson Hotel Group (which under its new Jin Jiang ownership is part of the first global website giving guests and loyalty of connecting, inspiring, innovating and members access to more than 1,100 hotels upside potential. world’s second largest hotel group in worldwide, including PPHE’s portfolio. empowering colleagues. terms of number of rooms) we have the We delight our guests rights to develop and operate Park Plaza The new Radisson Hotels App, which launched shortly afterwards, provides every day, through branded hotels and resorts in Europe, our guests with an even more personalised the Middle East and Africa. This strategic engaging service and partnership gives us many benefits, user experience. The Kitchen at Holmes As part of Radisson Hotel Group’s quality products in including access to Radisson’s central reservation and distribution systems, five-year operating plan, we will benefit inviting places. powerful online and mobile platforms, from a multi-million-dollar technology investment, which unifies tasks such global sales, reward programme with more than 24 million members, marketing as reservations, loyalty, sales, property initiatives and buying power. management and more. We look forward to the full roll-out, which will benefit our In July 2019, Radisson Hotel Group guests and team members alike, while announced a collaboration with WeHotel, further increasing the efficiency of the global hotel booking platform of new our business. owners, Jin Jiang International. As part of this affiliation, WeHotel Prime, Jin Jiang’s We operate our own art’otel lifestyle brand reward programme, is now available for (also marketed through our partnership with high-end Radisson Hotel Group properties. Radisson Hotel Group), and our majority- PPHE is delighted to be part of a wider owned Croatian subsidiary operates several global distribution and marketing reach of its properties under the Arena Hotels & as we also continue to grow as a Group. Apartments and Arena Campsites brands. Our multi-brand approach enables us to develop and operate properties across several segments of the hospitality market, and to choose the most appropriate brand for each property so that we can maximise returns from our assets. P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 14 15
S T R AT E G I C R E P O R T S T R AT E G I C R E P O R T C O R P O R AT E G O V E R N A N C E F I N A N C I A L S TAT E M E N T S APPENDICES P R E S I D E N T & C H I E F E X E C U T I V E O F F I C E R ’ S S TAT E M E N T C O N T I N U E D Guest experience The Group’s own dedicated Technology & the repositioning project, an increase of 7 points from 85.1% at the beginning of 2019. award is testament to our owner/operator approach. The Group was awarded ‘Talent Q & A W ITH Business Solutions division has progressed Park Plaza Utrecht, which started to see the Development Team of the Year’ by the B OR IS IVESHA a number of guest experience programmes benefits of the repositioning, increased by Institute of Hospitality Awards 2019 and throughout 2019. This included IT security 8.2 points from 78.3% for the first half of 2019, at the HR in Hospitality Awards 2019 initiatives to support guest safety and to 86.5% for the final quarter of 2019. we won the ‘Excellence in Promoting Q – What is next for the Group, security, along with new best practice Careers Award’. now that you have achieved one Being part of our communities of your key goals for 2019 of policies and dedicated training programmes We are committed to making a positive Our plans for 2020 FTSE 250 membership? for team members (Information Security contribution to the communities in which Our 2019 financial results coupled with our Awareness training solution). Joining the FTSE 250 index of leading we operate through charity initiatives strategic progress once again demonstrate We understand that technology plays a huge and volunteering, supporting arts and the strength of our unique business model, companies was a proud moment for me part in our guests’ overall experience when culture, and providing jobs for those the appeal of our hospitality real estate personally and for the entire team, whose staying with us. In addition to benefiting who live near to our properties. portfolio and our rigorous focus on dedication and commitment in recent years from access to technology programmes performance. Over the last three years we has made it possible. We have come a long We bi-annually support breast cancer way in the 12 years since listing on AIM. from our strategic partner Radisson, we are completed more than £100 million asset and other health related charities. In 2019, But looking ahead it is now imperative that ourselves continuing to trial new solutions upgrade investment projects, the continued team members and guests in the United we raise our game even further to reap the and applications to evolve our offering. benefit of which is being reflected in our Kingdom, the Netherlands, Germany rewards of inclusion and meet our We recognise that our people make us financial performance and a significantly and Hungary took part in the globally responsibilities in terms of implementing who we are, and our recruitment strategy enhanced guest experience. recognised charity, “Movember”. further enhancements to our corporate is centred on building teams of talent who Our local community charity support Whilst we are closely monitoring the governance. Inclusion brings us access reach out and engage with guests, making also includes supporting disadvantaged current uncertain macro environmental to a wider investor community and we them feel welcome, valued, and inspired children and their family, elderly people developments related to the Coronavirus will continue to take the opportunity to by the surroundings and excellent service. and the homeless. We have also outbreak and its impact on travel patterns, Considerable effort will be focused on We have a robust process in place proactively engage with them in order our £300 million plus hotel development to ensure that the leadership teams are This commitment to guest experience supported the arts through sponsorship trading for the two months in 2020 for to build a long-term, high quality and has once again been recognised in our most of young designers and cultural festivals. our Group has been in line with the pipeline with major projects including the actively engaged with identifying our talented supportive share register. The increased art’otel london hoxton and our first hotel team members and developing them through recent online reputation score (as measured Board’s expectations. transparency and disclosure in this year’s Further detail of our Responsible Business in the USA, in New York City. The pace of our award-winning training and learning using ReviewPro’s Guest Rating Score), which Annual Report should be seen as testament initiatives is set out on pages 80 to 89 of Our longer term outlook focuses on growth work is planned to step up in 2020 in line programmes, including you:niversity. increased by 0.7 percentage points to 88.0% to our ongoing efforts to step-up our the Annual Report 2019. delivery through our well invested portfolio, with our plans to open these hotels in 2023. in 2019. These results show that our effort governance and communications. A prime example of our training and the delivery of our more than £300 million In addition to these projects, our in-house to incorporate guest feedback into our Industry recognition development pipeline of new properties in development culture in action was our 2019 repositioning programme and our day-to-day We were delighted for Park Plaza UK to From a strategic perspective we team will continue to seek out and evaluate London, New York and Eastern Europe and leadership summit ‘We Are Creators’ held service offering has proven successful. be awarded the ‘AA Large Hotel Group have a proven and winning formula of further development opportunities that additional acquisition opportunities. in London, which brought together more of the Year 2019-20’ accolade at the development, ownership and operations meet our returns criteria and are in line Furthermore, our Guest Rating Scores than 150 senior team members from each 22nd annual AA Hospitality Awards in which we plan to continue with. While PPHE with our strategic goals. at our three newly repositioned hotels of our four European operating regions. September 2019. This recognised our has come a long way in the past 30 year’s The challenge for all hoteliers is the We introduced our renewed strategy significantly improved. At Park Plaza the future looks equally as exciting, with Vondelpark Amsterdam the Guest commitment and strategic approach to hotel cycle and fears of a downturn. and our new blueprint, which aims to development, as well as our creative and a strong development pipeline of over As demonstrated in our financial results we positively impact the guest experience. Rating Score increased 6.4 points to 90.1% £300 million, which includes the following the relaunch of the hotel (prior to learning development programmes, which achieved good growth throughout 2019 from Our blueprint is ‘the way we do things’ together enable us to constantly delight development of our first hotel in the US. leisure and corporate customers. While not and enables our Leadership Team to relaunch the score was 83.7%). Holmes Hotel London increased to 92.1% following our guests. This is one of the most highly BORIS IVESHA Q – What are the main opportunities immune, we are resilient given our well develop a high-performing culture where regarded events in the industry and the PRESIDENT & and challenges you see in 2020? invested estate and the strategic position our teams feel engaged and empowered CHIEF E XECUTIVE OFFICER of our major assets in London and the to create valuable memories for our Our primary near-term growth opportunity Netherlands. Notwithstanding the ongoing guests and value for our assets, people Park Plaza Histria, Pula stems from the recent completion of our macro economic and geopolitical uncertainty and local communities. This blueprint and £100 million plus multi-year investment trading in the current year has started well a supporting dedicated programme of programme. These well-invested hotels and is in line with the Board’s expectations. activities have been cascaded through have shown good growth since launching/ As an owner/developer we are also able to most of our regions during 2019 to embed reopening and we see the scope for further seize commercial opportunities that may this approach within our business culture. top-line growth and margin accretion in 2020. Our teams will be focused on arise from any cyclical downturn as well as Reporting to the Board is our eight-strong ensuring that these hotels continue to control the timing of further investment Executive Leadership Team, all of whom build towards their return targets. projects in our hotel estate. have progressed through the business. We have recently strengthened the Q – This remains a founder-led and listed business. What are you doing leadership team, with Greg Hegarty to ensure long-term success? appointed to the new position of Deputy Chief Executive Officer as well as retaining The foundations of our past and future his position as Chief Operating Officer and success are solid; they are our people. Inbar Zilberman promoted to the role of We employ over 4,700 team members, Chief Corporate & Legal Officer. including an Executive Leadership Team In short, we have a strong track record of of eight. Supporting and encouraging all training and developing talent throughout team members to develop and grow their all levels of the business and this gives me careers within the business is a priority for us. confidence that we can maintain our track record through the next 30 years. P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 16 17
S T R AT E G I C R E P O R T S T R AT E G I C R E P O R T C O R P O R AT E G O V E R N A N C E F I N A N C I A L S TAT E M E N T S APPENDICES OUR BUSINESS MODEL AND PRIORITIES OU R OU R B USI NE SS S TR ATEG I C S TR ATEG I C PE R FO R M A N CE THE VALUE W E PU R P OSE M O DEL AGE N DA PR I O R ITIE S M A N AGE M E NT CR E ATE FO R OUR S TAK EH OLDER S Read more – pages 18 and 19 Read more – pages 36 and 37 Read more – pages 36 and 37 Read more – pages 50 to 61 Read more – pages 73 to 79 OU R PU R P OSE Our integrated model has We have a clear strategy to drive Our focused approach will ensure Our KPIs and targets. Team members Creating valuable memories for driven significant value. growth and long-term value. that we deliver on our strategy. We offer rewarding international employment opportunities for our guests and value for our assets, over 4,700 team members people and local communities. Property Property Property with continuous investment WHO WE ARE 4 1 in training programmes. Disciplined, focused Deliver all ongoing projects We are an international hospitality capital deployment and expand pipeline EPRA NAV real estate group, with a prime Creating Guests property portfolio consisting of stakeholder value We offer memorable hospitality 45 properties in operation in five Deploy capital in projects experiences in vibrant destinations with countries, that transforms an asset’s Optimise the value of the potential into value and profits. existing portfolio and new properties meeting EPRA EPS our high quality products and services. 3 2 our yield profile W H AT W E D O Investors Mature recent openings and We have a clear strategy to drive repositioned and renovated Extract value from portfolio growth and create long‑term value to fund further growth properties to generate targeted Net investment yield Our shareholders benefit from the attractive industry dynamics 1 while recognising and developing yield profile of the markets in which we operate opportunities to help our assets We purchase as well as our flexible business reach their full potential. We delight e typically acquire properties W model, developments and operating our guests every day, through which we believe have significant Implement target-based Net return on skills, in the form of progressive upside potential Long-term sustainability sustainable business strategy engaging service and quality shareholder capital dividend payments. products in inviting places. H OW W E D O IT By valuing our people, being led 2 We develop We (re)develop and redesign our Operations Operations Operations Local communities We care about our neighbourhoods and by an entrepreneurial Board and acquired assets, drawing on the Develop a high performing make positive contributions to our local through investing in our portfolio, skills of our experienced senior Consistently deliver the culture, where engaged teams EBITDA and communities and the people who work management team, with specialists opportunities with upside potential in every relevant discipline refreshed intended guest are empowered to create EBITDA margin and/or live there through fundraising and local communities. experience across our properties valuable memories for our activities, employment opportunities, 3 guests and value for our assets volunteering and local resourcing We brand properties partnerships and charities. Key sources of value and improve operating performance Improve the overall guest RevPAR We brand properties and strive for experience through creating – Prime property portfolio operational excellence, creating Maintain high operating valuable memories Affiliates significant value at every point margins Our partnership with Radisson Hotel in the value chain Focus on total revenue Group gives us access to global – In-house management generation with solid Employee engagement distribution systems, powerful online platform 4 We (re)finance to fund further investments Through refinancing our properties, profit conversion and mobile platforms and global sales, marketing and buying power. Leverage our scale and – Our people we are able to release capital for new inter-regional synergies Implement target-based investments, enabling the further sustainable business strategy Guest Rating Score (GRSTM) growth of our Group Suppliers – Multi-brand approach As an owner/operator, long-term sustainability and ethical operations Underpinned by our people, values and culture are high on our agenda including supply chain management and the – International network development of long-term relationships The Group’s leadership culture is one of connecting, with strategic partners, many of whom are local. – Financial strength inspiring, innovating and empowering, and we foster an environment based on: Trust Respect Teamwork Enthusiasm Commitment Care P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 18 19
S T R AT E G I C R E P O R T S T R AT E G I C R E P O R T C O R P O R AT E G O V E R N A N C E F I N A N C I A L S TAT E M E N T S APPENDICES T H E VA L U E W E C R E AT E ALL FUTURE GROW TH Holmes Hotel London THE THREE PILL AR S OF GROW TH We have a proven development strategy, targeting real estate in prime locations with upside potential. We are continuously seeking out and evaluating new opportunities as well as re-developing and repositioning PAGE 24 our own assets to benefit all. We Repositioning projects aim always to delight our guests, Our owner/operator business paired with our empower our team members, development expertise provides a major point of support strong local communities differentiation within the hospitality sector. This model and affiliates, and create value for not only gives us full control over the quality of our real estate assets, it also gives us the ability to react quickly all of our stakeholders. and invest in them as necessary, enabling us to fully optimise their potential value. Recent investment in asset repositioning programmes includes: Park Plaza THE VALUE Vondelpark, Amsterdam; Park Plaza Utrecht; Holmes W E CRE ATE Hotel London and Arena Kažela Campsite. C R E AT I N G Park Plaza London Waterloo art’otel london hoxton DY N A M I C S PAC E S PAGE 2 2 PAGE 3 2 Driving organic What the future growth pipeline holds We strive for operational excellence across our portfolio to Our strategy is to build on our success and drive organic growth, through both RevPAR improvements further expand our asset portfolio by targeting and margin accretion. In addition, we are always looking for real estate opportunities that have significant upside opportunities to add more room stock and other income potential, fit our long-term growth strategy and generating facilities to our hotels. create strong shareholder value. We have an exciting development pipeline for our wholly-owned art’otel Over the last three years, we have added 891 rooms brand, which includes two new hotels in London to our already impressive London portfolio. Park Plaza and an art’otel near the Hudson Yards area in New London Waterloo and Park Plaza London Park Royal, York City. We have also acquired a site on London’s both launched in 2017, together added 706 rooms. The South Bank and entered into agreements to extend major repositioning of Park Plaza London Riverbank our footprint in the CEE region. Together these projects Park Plaza Victoria London was completed in 2018 and expanded the property’s are expected to add approximately 800 rooms by the inventory by 40%. end of 2023. P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 20 21
S T R AT E G I C R E P O R T S T R AT E G I C R E P O R T C O R P O R AT E G O V E R N A N C E F I N A N C I A L S TAT E M E N T S APPENDICES T H E VA L U E W E C R E AT E C O N T I N U E D Completed 2017 Repositioning completed July 2018 Between 2016 and 2018, we invested a total of £20 million in a major Park Plaza Park Plaza Victoria repositioning programme. London Waterloo Amsterdam All public areas were completely reconfigured, 298 rooms were fully redesigned, and nine meeting and event rooms were transformed. A new Strengthened presence Well-invested property in bar, VIC’s BAR, was opened, and offers on London’s South Bank the centre of Amsterdam guests fantastic entertainment in the form of guest DJ sets and live jazz nights. The former office building located on Park Plaza Victoria Amsterdam is A new destination restaurant, Carsten’s, London’s South Bank was acquired in our iconic property in the heart of led by a celebrity concept chef, opened 2013 and following a £125 million Amsterdam, opposite Centraal Station. in February 2019. investment was developed into a high Its prime location presented a significant quality hotel offering 494 rooms and suites, opportunity to create value from our Since repositioning, guest rating scores a swimming pool and luxury spa facilities, real estate asset as well as inspire at the property have increased to 88% meeting rooms and an executive lounge, a our guests through a well-invested, in 2019. destination all day dining restaurant called high quality product. Florentine, and a bar offering live music. In July 2017, following completion of construction of the hotel, the Group sold Repositioning completed 2018 The hotel was fully repositioned. the property for £161 million and agreed a All public areas were reconfigured and 199-year leaseback. The leasehold remained Park Plaza London redesigned, and seven additional floors of accommodation added 185 rooms to with the Group is valued at £84 million, and with the sale and leaseback the Group Riverbank the inventory, transforming the property into a 646-room hotel. A new meeting released part of the value whilst retaining a long-term lease, control of the operations room and a 12th-floor Executive Lounge and associated profit of the hotel. Unrivalled hospitality were also created, and our award-winning real estate presence on Chino Latino Restaurant & Bar was With the above, the total value created relocated, giving this destination dining from development to the sale and 199-year London’s South Bank spot unrivalled views across the River leaseback was approximately £120 million. Thames. In addition, a spa and swimming Park Plaza London Riverbank first opened its Guest Rating Scores at the property have pool have been added to the property, doors on London’s South Bank in April 2005. been consistently high with a 89.9% rating giving the hotel an additional offer for Since then we have established a strong DRIVING in 2019. leisure guests. presence in this now vibrant area of London which has been the focus of significant We invested approximately £54 million regeneration in recent years. We seized in this major, multi-year repositioning ORGANIC the opportunity to transform the hotel by programme to create value for shareholders enhancing the amenities and the overall through capital appreciation and drive quality of our offer and guest experience operational returns through a high quality G R OW T H to reflect the fantastic rejuvenation of the product offer and exceptional guest service. surrounding area, including Vauxhall and In 2019, guest rating scores at the property Nine Elms, which have seen a massive were 88.0%. transformation in recent years. Repositioning completed 2018 and completely transformed to offer eight types of all-glamping accommodation Arena One 99 and premium amenities to reflect the site’s 4-star offer, and was launched in summer 2018. Total investment in the Successful new repositioning programme was £8 million. all-glamping offer Arena One 99 has received two accolades from the Croatian Tourist Awards programme Located in the peaceful village of Pomer, for Best Glamping and Best Campsite. Pula in southern Istria, Croatia, Arena One Performance of this site has continued 99 was formerly a limited service campsite in to mature in 2019, its second season a prime beachfront location stretching more in operation. than four hectares along the Adriatic coast. This is a prime hospitality real estate location. To capitalise on this, we identified an opportunity to launch Croatia’s first all-glamping resort. The campsite was closed following the summer of 2017 P P H E H O T E L G R O U P A N N U A L R E P O R T A N D A C C O U N T S 2 0 19 22 23
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