A home-grown hotel business is about to go global with its New Zealand-headquartered founder planning to expand his successful chain further nationally then into Australia and Fiji.

Sudesh Jhunjhnuwala, the Auckland-based founder of the Sudima Hotels and Resorts national chain, has seven hotels either already operating or about to be developed. He now has plans to build further new hotels in Wellington, Queenstown, Sydney, Melbourne and Fiji.

Plans for the new Auckland Sudima in the CBD.
Plans for the new Auckland Sudima in the CBD.

"We're planning these new hotels but it's a longer-term plan," Jhunjhnuwala said, citing the Australian hotel projects as being worth more than $200 million each and in the CBDs of the two cities.

Read more: New Sudima hotel for Auckland CBD, 425 rooms announced in two days

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The entrepreneur said these plans are for about the next five years through to about 2023 and he has targeted those geographic areas "as a natural progression of the business. Our next steps is to Australia and the islands. It was a natural next progression after Wellington and Queenstown to go to Fiji, Sydney and Melbourne".

Each of the five new hotels would have about 150 rooms and the Suva hotel would be aimed at the corporate market, he said. Room rates were currently in the $250/night region here while Australian rates for similar hotels are now more in the A$300/night range, he said.

The existing portfolio of Sudima hotels already developed was worth around $300m, he estimated.

Jhunjhnuwala outlined a relatively lowly-geared financial strategy: "We are very conservative and well within our banking covenants," he said, telling of a 40 per cent debt-to-equity ratio in the business with borrowings solely from the BNZ. That bank might need to syndicate some loans as Sudima grew, he said.

On July 19, he announced plans for a new $70m 10-level Sudima hotel on the site of the former Datacom House, in the corner of Wellesley St and Nelson St in Auckland's CBD across the road from the NZ International Convention Centre. Around half the development cost would be borrowed, he said, and building consent was already granted.

Sudima bought the site in November from a private investor for $12.25m, he said. The site slopes and cars will come in from one street but leave from another. No construction company has yet been appointed.

A company statement said: "The new Auckland CBD hotel is Sudima Hotel's seventh investment in New Zealand hotels and infrastructure, adding to the hotel brand's nationwide presence with properties at Auckland Airport, Hamilton, Rotorua, and Christchurch Airport along with the in-development $40m Christchurch CBD hotel due to open in early 2019 and recently announced $30m Kaikoura hotel scheduled to open in the summer of 2019/2020. Sudima Hotels' current hotels in-development represent an investment of $135m across the country, adding approximately 400 rooms to the national accommodation stock, and around 190 additional jobs."

Sudima Hotels is owned and managed by the entrepreneur and property investor.

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Plans for the Indigo Hotel at 51 Albert St in Auckland.
Plans for the Indigo Hotel at 51 Albert St in Auckland.

Meanwhile, plans for another new Auckland hotel were revealed last week. Abhijay Sandilya, InterContinental Hotels Group Australian and South Pacific senior director of development, said a 225-room Indigo Hotel was planned for 51 Albert St.

"The resource consent for the site had a 46-level building approved but the scale will be reduced and it will be a lower building," he said, telling of a 2021 opening.

"We'll be targeting the corporate traveller with a mix of international and domestic travellers."

The facade of the heritage Macdonald Halligan Motors building would be retained, he said. The Indigio chain has 88 hotels around the world, plans to build five in Australia and is eyeing Queenstown.

Dean Humphries, Colliers International's national hotel director, welcomed the new developments, with Peter Wall also telling of a possible new hotel in a mixed-use development at 13 Albert St and 9 Wolfe St although Wall stressed concept planning had not yet been completed.

"There will also be a few more major announcements of new hotels in coming weeks, so it's great to see so much new development in this sector; provided they can find companies to build them," Humphries said.