Between 9-11 September 2024, senior representatives from across the hospitality industry will head to Hong Kong for the inaugural International Hospitality Investment Forum (IHIF) Asia 2024.
This year’s speakers include senior representatives from: Gaw Capital, Ares Management, Hilton, Radisson Hotel Group, and many more.
Not only will you hear from leading hotel investment executives, but the multiple networking opportunities mean you’ll be able to capitalise on the return to dealmaking we are seeing this year.
You can book your ticket here.
The opening of the 989-room Mercure Icon in Singapore this spring, marking the launch of the largest Mercure hotel in the world, was another bold move from hospitality group Worldwide Hotels. The Asian hotel developer, owner and operator has made known its ambitions across the region in recent years, with the Accor tie-up underlining its ease with international partnerships. Worldwide has notably co-branded the hotel both as Mercure and Icon, as part of its bespoke agreement with Accor; Icon is the seventh brand in its home market of Singapore.
Built on the plot of a former carpark, Worldwide won the site tender for the Mercure Icon in 2019 via the Singapore government’s land sales programme. The final product is described as “lean luxury” by Worldwide’s chief executive Carolyn Choo, who adds: “Our goal with Mercure Icon Singapore City Centre is to showcase our ability to push the envelope on luxury to a very affordable price point.” She adds: “The Mercure icon invites travellers to live like a local and experience Singapore in its most authentic and vibrant light.”
While the hotel towers over the Singapore skyline, it is remarkably the second biggest property in Worldwide’s empire, after the 1,500-key Hotel Boss, also situated in the island state. Worldwide, which celebrated its 30th anniversary in April, has become synonymous with Singapore’s budget and midscale hospitality scene thanks to the famed persistence of the family behind the name.
Rags to riches tale
Carolyn Choo’s father is Singaporean tycoon, Choo Chong Ngen, who built the group’s 50+ asset strong portfolio himself from extremely lean beginnings. Indeed, the rags to riches tale of Singapore entrepreneur Choo, whose wealth is estimated at $3.18 billion today, is the story of a kid that dropped out of school aged 14 to work on market stalls, before painstakingly amassing his significant empire on a culture of learned frugality.
His modestly priced hotels display an understanding of the resilience of budget travel. Famously, Choo prefers to buy to hold, rather than speculating or flipping properties. His hotel empire is today run by his daughter, who incorporated the Worldwide Hotels group in 2018 to consolidate the family’s hotel assets. These amount to over 52 hotels across Asia. While the majority of the group’s properties are in Singapore, Worldwide also has 11 hotels in Australia, Malaysia, Japan, South Korea, and Thailand.
Choo, who opened his own textiles stall aged 17, found his fortunes initially in the rag trade, moving from anecdotally making “$1 a day” to amassing a string of stores. He also quickly saw the value in real estate investment, stating: “After the first shop unit, I bought another one as soon as I had more money, and used the rental income to pay the loan instalments.” This experience in fact inspired a move into acquiring land to develop apartments.
For his first apartments, as a developer, he had to look to the city’s cheapest plots in the red-light district of Geylang. Another five blocks followed in the neighbourhoods of Balestier, Lim Tua Tow Road and Telok Kurau.
Hospitality potential
Choo moved into the lodgings business in 1993, inspired by a stay in a Japanese budget business hotel. For the launch of budget chain Hotel 81, he returned to a plot he already owned in Geylang. The name of his brand was taken from the number of the house he lived in at the time: simple and easy to remember. Affordable real estate in a run-down but central location with high footfall proved the first step on the ladder to hospitality success. Today, Choo’s group still includes nine hotels in Geylang, advertised as offering the “best value” in the city.
Fifteen years after entering the lodgings industry, Choo started to develop out his portfolio of brands, launching the Value chain of hotels in 2008. Brand V followed in 2011, before the boutique Venue chain was created in 2013. Boss, which was launched in 2015, offers basic affordability to business and leisure travellers; brand Mi came in 2017, a more adventurous lifestyle concept aligned with “experiential” travel.
Finally, Icon arrived this year, representing a more high-profile yet midscale offering. Today the group has over 40 properties in Singapore, representing over 8,000 rooms across the island. Beyond its home-grown brands, it owns the Mercure Icon and the 543-room Novotel Singapore on Kitchener in the Little India district.
Appetite for deals
Worldwide acquired the hotel on Kitchener in July 2023, dropping S$525 million for the property purchased from Pan Pacific Hotels Group. In the same week, it acquired a back-to-back Novotel & Ibis hotel in Australia, the Melbourne Central Hotel, for A$170 million. Brokers for both deals – JLL Hotels and CBRE Hotels respectively – reported that Kitchener deal was the largest single-asset transaction ever recorded in Singapore. The Melbourne Central buy, meanwhile, marked the largest hotel deal in the city for six years.
Of the hotels Worldwide holds outside Singapore, nine of those were acquired since 2017, with all being managed by major brands such as Ibis, Holiday Inn, Novotel, Swiss Garden and Travelodge. Apart from the latest Accor tie-ups, it prefers to use its own brands in Singapore.
Despite this appetite for expansion and the ambition in the group’s name, Carolyn Choo rules out global domination – at least in the near future – stating that Worldwide remains focused “only on Asia-Pacific. We are not looking for any new markets”. Yet the group will attempt to buy another 10 hotels beyond its borders over the next decade. Third-party management agreements in Asia-Pacific are also in its sights.
This is in part due to local synergies and partly to macroeconomic markers. “The outlook is very positive. It is just that with the high interest rates, a lot of investments will need a very long-term horizon.” She affirms that the group was initially able to grow so quickly due to the budget airlines boom, which brought new travellers from across the region, albeit with careful spending habits.
Worldwide survived the pandemic, notably retaining all its employees, and developing its community relations by giving back to local schools. Now it seeks further consolidation in Asia-Pacific – before maybe pursuing expansion further afield.