Salter Brothers advance ASX listing after $1bn splurge on InterContinental and Regent hotels

Paul Salter is pushing ahead with plans to list the hospitality group on the ASX, with hopes to build its portfolio into one of the largest in the Asia-Pacific, worth around $2.5bn.

Paul Salter is pushing ahead with plans to list the hospitality group on the ASX, with hopes to build its portfolio into one of the largest in the Asia-Pacific, worth around $2.5bn.

Melbourne-based fund manager Salter Brothers has undertaken a wholesale upgrade of its hotel brands, taking them from Crowne Plaza to the more upmarket InterContinental and Regent brands in a $1bn plus deal as it advances plans to list a hospitality vehicle.

Salter Brothers managing director Paul Salter says he was advancing plans to list a hospitality vehicle within 18 months, with hopes to build its portfolio into one of the largest such vehicles in the Asia-Pacific, worth around $2.5bn.

“We are still continuing to pursue an IPO, it’s a hospitality REIT. It’s 18 months away, it’s still a part of the larger strategy,” he said.

“We have a lot of interest from investors to try and participate in that vehicle … which has an end value of $2.5bn,” said Mr Salter.

Salter Brothers will tip six properties worth more than $1bn which will be managed by international hotelier IHG Hotels & Resorts into the portfolio as well as various other existing assets.

Crowne Plaza Sydney Coogee Beach will be renamed the InterContinental Sydney Coogee Beach

“Everything in today’s announcement…so that is the Regent Hotels, the (new) development in Canberra. The development assets will (also) go in once they are built,” Mr Salter said.

IHG and Salter Brothers announced on Wednesday that hotels in Melbourne, Canberra, the Gold Coast and Sydney will be included in the major portfolio changes which will see the Regent Hotels & Resorts brand returned to Australia after a 28-year absence, Crowne Plaza Melbourne and Coogee upgraded to InterContinental hotel brands as well as the development of a new Hotel Indigo Canberra and the redevelopment and expansion of the trendy voco hotel on the Gold Coast.

Under the new plans, the InterContinental Melbourne the Rialto will be rebranded the Regent Melbourne, with the precinct created into a landmark destination in Melbourne’s CBD including conference and event spaces, restaurants, bars and a spa.

Mr Salter said the fund manager had a strong history with IHG spanning more than a decade, and is fully committed to the partnership, which he said continues to drive growth for our assets.

“This new agreement represents over $1bn investment in the luxury and lifestyle segment and highlights our conviction in providing distinctive lifestyle experiences for travellers globally, with an emphasis on timeless style, culinary mastery and wellness facilities for guests.”

“We look forward to working with IHG throughout the journey of these exceptional hotels, and welcoming domestic and international guests to experience these incredible properties under their new brands in the coming years.”

Inside the rebranded InterContinental Sydney Coogee Beach.

Mr Salter said he was not worried about dwindling consumer spending. “… people travelling are looking for experiences and are prepared to spend more.”

He said international travellers, such as Indian holidaymakers, Europeans, South East Asians and Americans, were returning to Australia. “China internationals are probably roughly at 50 per cent of what they were before covid. It’s a change in the mix.”

“We will see more international travel arrivals over the next 5–10 years. We are positioning the portfolio for it, we are positioning it for that macro shift,” said Mr Salter, adding that he was looking to buy more hotels, particularly domestically and offshore in Japan and Korea specifically.

Although recent STR research shows that Melbourne’s hotel rate growth was negative 3.3 per cent in the 2024 financial year, compared with Sydney’s hotels, which recorded nearly 4 per cent increases, while Perth recorded a 3.2 per cent growth over the same time frame, a major part of today’s announcement was the redevelopment of the Melbourne InterContinental.

Mr Salter is unphased, saying Melbourne is the sporting capital of Australia and much of the new hotel supply has already arrived.

The new-look InterContinental Sydney Coogee Beach.

“That new supply has been delivered over the next 12 months. The Melbourne market has been resilient, it’s the sporting capital of Australia and a great events market.”

He added that the new Melbourne Regent won’t be delivered until 2030, adding that by that time the Melbourne Regent hotel will be well positioned in the market.

Under the plan for the Melbourne Regent, the non heritage component of the existing InterContinental hotel will be demolished and a new tower constructed.

“For that asset we looked at an appropriate brand, with the capital we wanted what we considered a six-star brand, and The Regent has some beautiful properties globally it would be appropriate for that site,” Mr Salter said.

IHG Hotels and Resorts managing director, Australasia Pacific Matt Tripolone, added that all these Salter properties are in Premium A Grade locations. “In our view, these markets are significantly mature and now lend themselves to more premium brands.”

Mr Tripolone stressed that the partnership enables Salter Brothers to reposition key assets and unlock long-term value.

He said the Crowne Plaza Sydney Coogee Beach would reopen as an InterContinental Sydney Coogee Beach, in late 2025. Crowne Plaza Canberra will be redeveloped to create a new precinct for InterContinental Canberra and Hotel Indigo Canberra.

The Hotel Indigo Canberra will add a boutique lifestyle brand to the Canberra market, while the Crowne Plaza Melbourne will be rebranded into an InterContinental Melbourne.

The voco Gold Coast will be refurbished and expanded.

All up, IHG Hotels & Resorts manages 77 hotels in Australasia with nine brands including Six Senses, InterContinental, Hotel Indigo, voco, Crowne Plaza.