The Byron Bay Beach Hotel was sold to IIG for $70 million in September last year, and with settlement approaching at the end of February, the investment group said they were excited to begin reinvigorating the property.
IIG’s mission is “to shift capital towards investments that blend financial returns with deep social and environmental impact”, and this kind of hotel transformation is a new initiative for the group.
The head of funds management for real estate at IIG, Darren Brusnahan, told Pro Bono News the company would prioritise removing gaming facilities from the venue to demonstrate that a successful hotel can be run without gambling revenue.
“We thought that Byron Bay was a great location, as one of Australia’s leading communities around the environment and sustainability. And with the asset itself, we saw that there was some initiatives that could be done instantly to prove that there are more sustainable ways to run a hotel,” Brusnahan said.
“There are currently 15 poker machines on the site and we will have those removed as soon as practicably possible after settlement at the end of February. And the funds through the sale of those poker machines will be re-invested into other initiatives which include upgrades to the accommodation rooms.
“We’re quite passionate about wrestling what gaming machines can do to society. We’re certainly looking to make this an example around how a hotel can be successful without the reliance of gaming income.”
Brusnahan said this would have a positive impact on the local community, and hopefully encourage other hotels to follow suit.
“There’s no doubt that in the precinct and in the community, gambling is a significant social problem. And talking to the community and parts of Byron Council, they are fully behind the initiative,” he said.
“Hopefully this will encourage other hotels around Australia to look at doing the same thing.”
The Alliance for Gambling Reform director and lead spokesman Tim Costello, told Pro Bono News he was “profoundly impressed” by IIG’s plans for the hotel, and said he hoped it would create momentum for the gambling reform movement in New South Wales.
“I’ve met with the new owners of The Beach and was profoundly impressed by their vision to immediately remove the pokies, and [I] hope this becomes the beginning of a national trend where more of the 5,000 pokies venues across Australia follow this inspiring lead and pursue a pokies-free future,” Costello said.
“NSW is the epicentre of Australian gambling harm and delivers more than $6 billion of the $12 billion lost nationally on Australia’s 200,000 poker machines.
“Byron is an iconic Australian destination renowned for its independent spirit and I’m hoping the new owners of The Beach can team up with Byron Shire to deliver some much needed momentum to the gambling reform movement in NSW given our largest state is also Australia’s most gambling-captured jurisdiction.”
Brusnahan said IIG would look to create “a place of vitality” by including other health and wellbeing initiatives in the hotel, including spaces to relax, eat, socialise and mediate.
The investment group will also prioritise having a positive environmental impact through a number of sustainable measures.
“All our refurbishment works will use recycled materials, and our goal is to have our waste to landfill less than 10 per cent,” Brusnahan said.
“We’ll also look to water reduction. With this type of asset, reducing water… isn’t as easy when you have kitchens and accommodation. But we’ll certainly look to reduce that to at least 25 per cent and it can be achieved through very straightforward, more efficient plumbing fixtures and fittings.
“[And through] an energy audit we will look at things around electricity and gas and a report will look at how we can reduce our carbon footprint by just under 40 per cent.”
Brusnahan said the general state of impact investing in Australia was strong, with a greater awareness and understanding of the implications of investment choices on the community.
“We’re certainly seeing a strong uplift in people and investor’s awareness of this, particularly around climate and the environment. And then there’s an emergence of [reflecting on] what impact does our investment decisions have on the social environment,” he said.
“It’s really pushing us further on what we’re delivering on a social level.”
This article originally appeared on Pro Bono News and was written by Luke Michael (@luke_michael96). Luke Michael is a journalist at Pro Bono News covering the social sector.