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Park Plaza Hotel Group (PPHE) - Investment Portfolio for Strategic Asset Management - Master Facility and Real Estate Management - Hogeschool Saxion Deventer$4.47
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Park Plaza Hotel Group (PPHE) - Investment Portfolio for Strategic Asset Management - Master Facility and Real Estate Management - Hogeschool Saxion Deventer
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Course
Strategic Asset Management (L.19555)
Institution
Saxion Hogeschool (Saxion)
Investment portfolio for PPHE Group, Park Plaza Hotel Group. Including a strategy to build a new hotel or rent it out with all the real estate and financial calculations. Fully in English for the master Facility and Real Estate Management at Hogeschool Saxion Deventer.
Title assignment : Coursework Assignment 1 – Portfolio with three advisory reports
about financial management
Name module/course code : SAM
Name Tutor : John A.W.M. Brands MBA
Name student : Jorden van Ramshorst
Full-time / Part-time : Full-Time
Greenwich student nr. : 001278544
Saxion student nr. : 532393
Academic year : 2022-2023
Date : 26 – 10 - 2022
Word count : 6632 words
Table of Contents
Introduction........................................................................................................................2
Capital Market & Investment Industry................................................................................3
Capital Market & Investment Industry..........................................................................................3
Global & Local trends of the hospitality market............................................................................4
Relation to PPHE...........................................................................................................................6
Conclusions...................................................................................................................................7
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,Financial statements...........................................................................................................7
Horizontal & Vertical Analysis.......................................................................................................7
Calculation of ratio’s.....................................................................................................................9
Quick & Current ratio....................................................................................................................9
Solvency ratio’s.............................................................................................................................9
Gearing Ratio..............................................................................................................................10
Profitability Ratios.......................................................................................................................10
Gross Profit Margin & Operating Margin.....................................................................................10
ROC, ROI & ROA..........................................................................................................................11
Cash Flow Ratios.........................................................................................................................12
Interest Cover Ratio (ICR)............................................................................................................12
Assessment.................................................................................................................................13
Conclusions.................................................................................................................................14
Real Estate Performance...................................................................................................15
The Assessment...........................................................................................................................17
Conclusion...................................................................................................................................18
Sources:............................................................................................................................18
Appendix 1: The Balance Sheet.........................................................................................22
Appendix 2: The Income Statement...................................................................................23
Appendix 3: The Cashflow Statement................................................................................24
Appendix 4: The Yield Rate, Revenue, Rent per m2 Calculations........................................25
Appendix 5: The Net Present Value, DCF, IRR and different scenarios................................26
Introduction
Starting in 1986 at that time known as ‘Park Plaza International’, which also marked
the foundation of the PPHE Group, founded by US investor Jonathan R. Read
(Crunchbase, 2022), (PPHE, 2022). Making his way through Europe in 1989, starting
with his first hotel known as ‘Park Plaza Eindhoven’ located in the Netherlands. Four
years later he rebranded and acquired the ‘Park Plaza Victoria Hotel’ Amsterdam.
Expanding besides the Netherlands to Belgium, France, and Israel in 1994, acquiring
their license to establish hotels and resorts. In 1995 the ‘Park Plaza hotel Utrecht’
joined the real estate portfolio of PPHE Group. With London’s own Park Plaza hotel to
join in 1999.
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, The US travel management company Carlson became owner of the Park Plaza group
in the year 2000 and brought the concept of art’otels into the German and Hungarian
market. Gaining including the territorial licence to settle in an extra of fifty-two
countries. Between 2003 – 2006 there were eleven hotels added to the total portfolio,
the Park Plaza Hotel London Riverbank and Plaza on the river were the most notable.
Park Plaza Hotels Limited was successfully established in 2007, including the raising
of 85 million pounds. Furthermore, the worldwide rights of the art’otels were acquired in
the same year and being listed at the London Stock Exchange. Getting into the resort
segment and acquiring an ownership stake in Arenaturist Group in Croatia, marked the
year 2008. The first Airport hotel (Park Plaza Amsterdam) was added to the portfolio in
2010, together with the opening of the 1019-room Park Plaza Westminster Bridge
London. The year of two big financial number records, 2011 showed an EBITDA of 65
million euros and a revenue of 202,4 million euros. Park Plaza hotels became PPHE
group officially in 2012, reflecting their multi-brand approach for operating hotels. In
Croatia, there were three Park Plaza resort opened in the same year. In 2016, PPHE
successfully completed their debt restructuring programme, and realised shareholder
value via special dividend of one pound per ordinary share. Renovation started in the
year 2017, beginning with hotels like Park Plaza Victoria Amsterdam, Park Plaza
Vondelpark Amsterdam, Park Plaza Utrecht and Park Plaza Sherlock Holmes. PPHE
becomes a member of the EPRA (European Public Real Estate Association) and
upgrades to a premium listening. 2018 marks the year of the completion of the
multiyear extensive 100 million pounds hotel investment programme, aimed at
repositioning and upgrading their property portfolio in the Netherlands and the United
Kingdom. Entering the USA market in the same year, with the art’otels brand moving to
Manhattan, New York. Securing 180 million pounds to cover the building of the art’otel
London Hoxton, expected to be completed by 2024.
In total PPHE group owns 46 properties around the globe, with London as it’s primary
location. The portfolio includes a total of 8,800 rooms, 8 campsites and 6,000 units.
The vision of PPHE says the following: “To deliver a best-in-class performance through
building further scale and depth in our real estate portfolio and growing the platform
with our integrated ‘Buy, Build, Operate’ model” (PPHE, 2021).
Capital Market & Investment Industry
Capital Market & Investment Industry
The hospitality industry operates mostly in a private market, where different parties
join. The different parties are private investors, private equity companies, investment
cooperation’s and other big hospitality groups (Yoong, 2019). Acquiring buildings and
the brand concept of the hotel will be done in the private markets. Although, as a public
investor you can trade in Hotel REITs on the public stock market (Hoteltechreport,
2022). For example, the Albus Hotel located on the Vijzelstraat in Amsterdam was sold
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