Complaint Review: STAYWELL HOSPITALITY GROUP - Sydney

STAYWELL HOSPITALITY GROUP (SWHG) also known as Leisure Inn Hospitality Management Pty Ltd (LIHM) or Staywell Hospitality Group Pty Ltd  or Staywell Hospitality Management Pty Ltd operating under the Leisure Inn and Park Regis hotel brands.

Staywell Hospitality Group is an Australian based hospitality management company to be avoided AT ALL COST.

DONT ENGAGE IN ANY BUSINESS DEALINGS OR INVESTMENTS WITH THIS COMPANY UNLESS YOU WANT TO BE RIPPED OFF.

As a potential client or investor you should employ an expert to conduct a thorough and extensive due diligence on the company and its directors which must include personally speaking to previous investors, customers and staff to know what you are actually getting yourself into.

The problem is Staywell is run by Simon Wan, Richard McCafie Doyle and Balbinda Sohal who have no interest in building a long term business relationship with you. Sure they will wine and dine you till the early hours and promise the world but this is just a front as their sole intention is to lock you into an onerous legally binding agreements that will be used as commercial leverage verging on extortion to get money from you, even if no services have been provided to your hotel or no dividend on your investment. And if you object to paying for the services that have not been provided you will end up defending an expensive and protracted litigation. As a property owner you will experience being starved of cash if you are silly enough to allow them to control your hotel’s bank account, having your banking arrangements undermined when copies of breach notices are served on your financier and the decimation of the value of your properties by woeful trading performance reckless spending behaviour.

Many owners have already discovered that Staywell simply cannot deliver the services they promise and that their one sided agreements give you no means of making them accountable for the damage they will cause.

Since the incorporation of SWHG in 2006,  the pattern of “churn and burn” has become the very foundation of their business model which is at best a sophisticated billing machine and legal recovery business.

Summary of matters to consider before signing any management agreement with a Staywell related company ;

Management Agreememts

• Don’t ever give them control of your hotel’s bank accounts
• Ensure that industry recognised dispute resolution procedures are included in any agreement – as you will need them
• Specify precisely all fees, charges and recharges including a detailed monthly budget of every billable item and include performance criteria for every expense ( as it is likely Staywell will be charging you a share of its head office running costs that are of zero benefit to your hotel )
• Do not allow any set off provisions
• Do not allow fees to continue to be due if they have ceased providing services
• Include provisions for “without cause” termination
• Never provide any tripartite agreement with Staywell and your Bank
• Include enforceable performance provisions that can be relied upon so that you can immediately terminate when Staywell defaults on its management obligations
• If Food & Beverage is involved, get an expert independent operator or outsource it as they just cannot manage F & B effectively
• Always have a backup plan for alternate management so that you can have full control if you terminate
• Get expert advice, then choose an alternative manager

Management agreements with this company should simply be avoided as they contain clauses that give you little or no recourse when Staywell inevitably do not provide the services that they contracted to do. 

Staywell Investments

• If you are intending to Invest in a Staywell related company or venture remember these tips are essential ;
• Don’t invest unless you have veto on all spending or a controlling interest
• Insist on regular detailed reporting
• Beware of secret side deals that Simon and Richard will make in transactions without reference to you
• Don’t get so financially committed that you are on the treadmill of having to keep investing just to get your capital back with the fear that the company is worthless without Simon Wan and Richard Doyle
• Find an alternative investment

These points may seem simplistic but there are a few very astute international investors that have been duped by the Staywell executives.

Don’t be fooled by the fancy restaurants, dancing girls and free massages that they will shower you with while courting you as a client or investor, as these highly sophisticated white collar scam artists will have their pre meditated private agenda in play from the very start until you have signed on the dotted line which after a short period of time you will feel the wrath of their thirst for money when they unleash their high level litigation program at the drop of a hat should you ever question their entitlement….so much for that warm fuzzy feeling – now it's war!

Before you know it you will be waking up with a major hangover when you are forced to hand over a huge sum just to get out of the agreement that you realise you should never have signed in the first place. Rather than learn that lesson the hard way as many others have, please heed this warning and take this advice.

In summary, if you have a hotel DON’T SIGN ANYTHING WITH THIS COMPANY before seeing a very good lawyer. Entering into a management agreement or investing with Staywell will cost you hundreds of thousands if not millions of dollars in overcharges, revenue losses and reduced valuation of your property.