The founding family of Australian hardware retail chain Bunnings Warehouse is leading a consortium hunting for investment properties in Christchurch and Queenstown.
Sydney-based backpacker firm Nomads World Hotels said yesterday it had joined forces with the Bunning family, which would help finance its expansion plans.
Nomads said the family - which no
longer owns the 130-year old DIY chain - would add capital in addition to brand development and property skills.
Nomads' New Zealand and Fiji operations manager Gordon Burrow yesterday said several city centre properties had been identified but details would stay confidential until a deal was reached.
However, any purchase is likely to be sizeable in order to provide the kind of accommodation Nomads intends to provide which included private hostel rooms with en suites.
The Bunning family sold their last shares in the hardware chain in 1994 to Australian firm Wesfarmers. Daniel Bunning, the son of Gavin Bunning who helped manage the business until the family sold out, said the family now focused on property investments.
The father and son were investigating a potential hostel property deal when they met with Nomads, a meeting which resulted in Daniel buying 45 per cent of the business on June 11.
Burrow said Christchurch had been identified as a desirable market to enter because of the number of additional international passenger seats coming into the city's airport - particularly from low-cost flights from Australia and Air New Zealand's new direct Los Angeles to Christchurch route starting in November.
"We are looking to develop in Christchurch because it is the gateway to the south," he said.
More than 300,000 backpackers travelled to New Zealand each year and the industry had changed from being unstructured to lucrative, Burrow said.
"Dramatic growth has left many lifestyle players bewildered by what the industry has, and will, become," he said. "We need the skills of established business builders, like the Bunning group, to take a company like ours to the next level."
Bunning said the company had further expansion in mind.
"We're aiming to get in place a proper coherent network. For us that means securing the gateways," and then moving into the tourist centres such as Paihia and Nelson.
Nomads has a hostel in Auckland and plans to open others in Rotorua and Wellington.
- NZPA, staff reporter
