Lifestyle hotel brand Ovolo is ramping up expansion in Asia Pacific and beyond with plans to more than double its network through acquisitions, HMAs, joint ventures and partnerships.
“This is the first time where we are looking aggressively to potentially partner with like-minded people to take this brand further,” Ovolo Hotels CEO, Dave Baswal, told HM exclusively.
“We are open to management agreements; we are much more open now when we are approaching the market – investors, developers, hotel owners – to find opportunities. And that’s the mandate. Our main focus is to grow at a sustainable pace and find momentum for the brand.”
Ovolo is looking to expand further in Australia, New Zealand, and selected APAC markets that are popular with its primarily Australian customer base.
“There is still a good opportunity [for Ovolo] within Australia,” Baswal said.
“Growing further in Sydney, Melbourne and Brisbane; markets like Auckland, Adelaide, and Perth are there for us to explore. We have a very strong domestic market which makes us very successful in Australia.”
After opening its first hotel in Indonesia late last year, Ovolo is keen to grow in major urban and leisure destinations in Asia including Tokyo, Singapore, Bangkok, and Phuket.
“We opened our first hotel in Bali, Mamaka at Kuta Beach, which has taken off really well in the last three months,” Baswal said.
“Using our presence in Bali [to expand in Asia Pacific], big cities like Singapore, Tokyo are obvious for us, and areas like Phuket which are travel destinations for Australians would be our choice in the leisure market. Our biggest clientele at the moment is Australian domestic travellers.”
The group is also eyeing key source markets in Europe and beyond, but Baswal says that is around 12 to 18 months away.
“Once we have found a bit more momentum in Asia Pacific, we’re very open to look for partners and joint venture opportunities which can get us entry into the European market,” he said.
“We have started studying that market more actively, being on site and talking to potential opportunities, but we are in the early stages.”
Out with the old, in with the new
Having tripled its room count over the last five years, Ovolo is now seeking value-add and conversion opportunities to drive recovery.
“One thing we’ve done really well is the value add in existing tired hotels. We’ve also done a lot of conversions from office buildings to the hotels,” Baswal said, pointing to Ovolo’s first ground up development in South Yarra Melbourne which opened late last year.
Baswal believes there is a lot of opportunity in existing hotels needing refurbishments in the current market.
“There’s a lot of hotel inventory in Australia which is struggling to compete when new hotels are popping up in the same city,” he said.
“Ovolo sees an opportunity to acquire those assets which require work, but instead of just uplifting that existing presence you can take it to another level and create an amazing experience and rebranded and reposition it to actually create value in that asset.”
Baswal said Ovolo is also open to taking on new developments with partners.
“If we do further developments, we will probably look for joint venture partners to take those projects as they have a longer turnaround,” he said.
“If someone who has development expertise joins us, we can bring the design and operating expertise – that automatically creates a very good partnership to bring a product to life.”
‘The perfect time’
Baswal says Ovolo has benefited from increased demand for experiential travel and expects that trend to continue.
“The customer post COVID is looking for a lot more than simply a place to sleep. They’re looking for more experience and more story, which is what we do really well as a lifestyle brand,” he said.
“The market definitely shifted towards where we are. We have already surpassed 2019’s ADR [Average Daily Rate] in the last three months and doing exceptionally well in the top line as well as bottom line.”
Ovolo Hotels Founder and Executive Chairman, Girish Jhunjhnuwala, said now is “the perfect time” to expand the Ovolo brand.
“After 20 years of building the Ovolo brand, we want to share our expertise and build long-term partnerships that can unlock an asset’s full potential and drive higher returns,” Jhunjhnuwala said.