AHS Hospitality founder Stephen Lauder is aiming to purchase up to 10 hotels around Australia through a property syndication venture he has established with Ascot Capital.
The venture bought its first property in July, when it paid $24 million for the 4.5-star Pacific Hotel Cairns.
“That was a fantastic buy for us, we bought it well,” Mr Lauder told Business News.
“We’re in the market now looking for other opportunities.
“We have capacity to look at transactions up to $100 million.”
“It’s very early days but we have a team of experienced hoteliers and business analysts that will provide the corporate support to each of the investments,” he said.
“We see massive opportunity to acquire properties, reposition them and improve the way they’re run.
“I want to build Facilimate into a national tourism and hotel operation.”
The three men teamed up last year to buy an office in Nedlands, from which they now operate.
“It’s been fantastic, we think in a very similar way, we’ve backed some private equity opportunities, and we’ve done some property deals together,” Mr Lauder said.
For the Ascot Capital founders, the hotel venture adds more diversity to their business, which includes Jandakot City industrial estate and 11 commercial properties held through syndicates.
“We think we have a business model that will take us up to 10 hotels, with ownership,” he said.
“As we grow, I think we will be attractive for developers and others to change over to our model.
“The branding doesn’t have to be the same, it’s the internal processes that are important.”
“We had brokers wanting to list us, private equity wanted to buy us, we had trade buyers.”
Mr Lauder sold a majority stake in the business to the ANZ Bank’s private equity arm in 2008, allowing him to stay as executive chairman.
The original plan was to expand the business internationally, but that was stymied by the GFC.
Four years on, Mr Lauder and ANZ agreed to sell the business to Chandler McLeod Group for $31.5 million.
Chandler McLeod has subsequently been acquired by Japan’s Recruit Holdings, yet Mr Lauder notes with pride that the AHS brand has been retained and the business continues to be run by executives he recruited.
Mr Lauder signed a two-year non-compete clause in 2012 when he sold out, giving him time with his young family and an opportunity to dabble in various investments.
“I did a number of business things but nothing that gave me true satisfaction, so I reassessed what I really wanted to do,” he said.
“I literally wrote a list of things I enjoy doing and what I don’t want to do.”
The list included running his own business, getting back into hospitality and into property in a bigger way, and utilising his experience in labour management.
The result was Facilimate, and the property syndication business.
“I realised I really enjoy business, I missed being in business,” Mr Lauder said.
“What I really missed was being able to drive a team, to motivate a team, to set goals and have them achieve that, and pulling the levers to achieve a result.
“Lots of investors like to be passive but I’m not one of those.”