Hilton to run historic Taupo hotel

The historic Terraces Hotel will become the Hilton Lake Taupo later this year. Photo / Supplied

New Zealand's second Hilton Hotel will be a kilometre from the shores of Lake Taupo at the historic Terraces Hotel.

Martin Rinck, president Hilton Hotels Asia Pacific, yesterday announced a deal to operate the country's second Hilton after the Princes Wharf hotel in Auckland.

The distinctive Terraces Hotel will be expanded and upgraded to meet Hilton's demands. A partly finished neighbouring 100-unit apartment block will form part of the expansion.

The 113-room Terraces, on State Highway 5 at 80-100 Napier Taupo Highway, will get an extra 149 rooms and a convention centre.

A group of New Zealand businessmen once closely involved with the Strategic business are behind the Hilton deal.

"Hilton Hotels Corporation has signed an agreement to manage the Hilton Lake Taupo on behalf of Triumph Capital, a privately owned New Zealand advisory company," Hilton announced yesterday.

Hilton said Triumph Capital had arranged project funding for the $55 million expansion.

Companies Office records show Triumph's directors are Brian Fitzgerald, Marc Lindale and Graham Jackson, formerly involved in the Strategic group of businesses.

Strategic Finance entered into a moratorium proposal in December agreeing to repay $325 million to its 15,000 stockholders in the next five years.

Fitzgerald said a group of investors, including him, owned the hotel. He praised Taupo as an excellent location for a hotel with its proximity to many parts of New Zealand.

Strategic Finance was sold to Australia's Allco in two deals negotiated in 2006 and 2007.

Strategic was also closely involved in Hilton Auckland, acting as a funder for the Princes Wharf development which drew Hilton here to operate its first New Zealand hotel from the harbour end of the wharf.

The company Princes Wharf Hotel, whose directors are Fitzgerald and St Laurence boss Kevin Podmore, is owned by Willeston Capital and Five Star Hotel Investments.

The Taupo property dates back to 1889 when the original hotel opened but had a big renovation in 2003.

Rinck said heritage building would form part of the new Hilton Lake Taupo, due to open later this year under its new name. The new convention centre and extra rooms were due to be finished by the middle of next year, he said. In 1964, Dominion Breweries bought the hotel, did major renovations and called it De Bretts. Hot pools were built but in the 1980s, DB sold the hotel and pools separately and they have been privately owned since.

Fitzgerald said his group bought the business in December from KordaMentha receivers.

Rick Cooper, Taupo's mayor, expressed delight Hilton had chosen his area and said the global brand would make the town more popular.

Jennie Langley, chairwoman of the Hotel Council, welcomed Hilton's expansion, saying it was excellent news for the tourism and hotel sector.

"This adds an incentive for people to visit Taupo and it has to be good for other hoteliers. Hilton is an international high five-star brand and Taupo doesn't have a lot at that top end other than Huka Lodge."

A Hilton was planned for Dunedin but developer Dan McEwan has been bankrupted.

HILTON
* Operates 3300 hotels.
* With 550,000 rooms.
* Operates in 77 countries.
* Employs about 130,000 people.
* Founded by Conrad Hilton.