Adelaide and Melbourne to welcome first Tribe hotels

The lounge in the Perth Tribe hotel. Picture: Earl Carter

Fresh from the sale of their prefabricated hotel brand Tribe, Mark and Melissa Peters, with the backing of Victor Smorgon and the Salta Group, have bought sites in Adelaide and Melbourne as part of their plan to establish up to 12 branded hotels in Australia.

French hotelier Accor has just acquired the Tribe brand, which presently sports a $30 million hotel in Perth with plans to open at least 50 Tribe-branded hotels in Australia and Europe.

Future hotel owners will be invited to use the brand’s modular construction system for a cheaper and faster build.

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“We think there’s room in Australia for 10 to 12 Tribe hotels. We also want to go to Europe, where we think the product is well suited in the way we build and operate,” Peters tells The Australian.

The core group of investors, the Peters, the Smorgons and the Salta Group’s Tarascio family have bought a site at 124 Wakefield St in the Adelaide CBD, where they plan a 256-room hotel. They plan two Tribe hotels in Melbourne, both with 180 rooms apiece, one on a site at 6 Langridge St, Collingwood.

“We are looking for sites that are well located within precincts that offer our guests a strong surrounding amenity,” Peters says.

Construction usually takes 12 months, he says, and hotel owners are under no obligation to use the MP Modular method for the hotel’s construction.

“Our background has been over the years procurement solutions out of China for global hotel groups,” Peters says.

“We saw a way to build hotels in a more efficient way and we saw a gap in the market for a more design-led innovative brand, for the mid-scale lifestyle sector.”

He describes Tribe hotels as four or five-star when it comes to interior design, but with a three-star price tag.

He says the Tribe product will work in Europe because of its high labour and construction costs.

“There has been an extremely overwhelming response from the European market,” he says.

Peters says the association with Accor will help Tribe tap into its distribution system.

“We see ourselves as a more sophisticated version of citizen M hotels,” he says. “We are like the Hoxton and Ace hotels out of the United Kingdom and the United States.”

Occupancies in the 126-room Perth Tribe hotel, which opened 18 months ago, are tracking above the company’s competitor set. “It’s a new brand in a relatively challenged market and we see that as only improving under Accor’s management,” Peters says.

He says there is a significant swing to the lifestyle sector, which Tribe is extremely well positioned to service.

“Hotel users are now seeking alternatives to the mainstream and Tribe provides a design-driven, boutique-style experience at an accessible price point,” he says. “The response to our brand to date has been very encouraging, attracting a strong mix of both leisure and corporate clients and appealing to a broad age group and demographic.”

In Australia, Peters says he is looking for well-located sites, noting that the development costs for the hotel are very much driven by its location and scale.

“As the number of keys increase the per key cost reduces,” he says. “We benefit from being able to access cost-effective offshore procurement channels that provide for a far higher level of interior than would otherwise be afforded using a traditional approach.”

This article originally appeared on www.theaustralian.com.au/property.