IHG Targets Luxury Growth with $100m Barossa Resort

Adelaide-based Strategic Alliance has signed global hotel giant IHG Hotels and Resorts to operate a $100-million luxury resort in the Barossa Valley. “This development will be transformative for the region,” IHG Australasia &amp; Pacific managing director Matt Tripolone told The Urban Developer . He said that for the first time, the Barossa would boast a globally branded luxury hotel. According to Tripolone, Australia’s luxury travel market has matured significantly, with consumers increasingly demanding the types of high-quality experiences driving IHG’s strategic expansion into regional destinations such as the Barossa Valley. The 150-room InterContinental Barossa Resort &amp; Spa resort is scheduled to open in 2028, subject to planning approvals. Tripolone said it was a calculated response to evolving consumer demands and untapped market potential in premier Australian wine regions. “If you look at great resort destinations that tick all the boxes in an Australian context, you probably have to go up to Far North Queensland and the Great Barrier Reef precinct,” Tripolone said. “Outside of those regions, we don’t have a lot of super high-quality, new and really presentable luxury estate in resort destinations around Australia.” Tripolone said strong international demand for luxury Australian experiences, particularly from American, European, Singaporean and Japanese travellers, would complement the expected 70 per cent domestic clientele. “There’s a huge component of liquid international travellers looking for these sorts of experiences, and at the moment they’re not able to get them,” Tripolone said. The resort is to be built on a 21ha site near Lyndoch, 43km north-east of Adelaide, that was secured by Adelaide-based Strategic Alliance for $1.35 million in December. It would feature a 130-seat signature restaurant, function spaces, wellness spa, pool, gym and its own cellar door with working vines already on the property. ▲ Strategic Alliance director David Cook, IHG managing director Australasia Pacific Matthew Tripolone, Hotellerie director Sonia Lefevre, IHG director of development Australasia Pacific Cameron Burke and Strategic Alliance director George Economou at the site. Tripolone said they were “working with a few groups” to secure a partnership for the destination restaurant. He also revealed that more than 30 per cent of IHG’s pipeline consisted of luxury and lifestyle properties—nearly triple the proportion from a decade ago—reflecting a fundamental shift in traveller preferences accelerated by the pandemic. “Covid changed a lot of things with people’s perceptions and behaviours and what was really important to them,” he said. “Australian and international travellers are now not willing to compromise on their experience. They’re willing to wait a little bit longer so they can afford to do it the way they want to do it, but they won’t compromise. “There’s a bigger trend going on in Australia and more broadly around the world and it’s this migration towards more refined, more bespoke, high-quality travel experiences. What we’re seeing is a migration towards this luxury lifestyle space.” The Barossa Valley, despite attracting more than 768,000 visitor nights annually, according to SA tourism figures, has struggled with accommodation infrastructure limitations. Tripolone said more than 70 per cent of visitors only did day trips to the region. “The whole region’s been held back by that,” Tripolone said. “There are only about 500 accommodation lodges out there now, so this presents a huge opportunity to tap the corporate market. “These destinations are really popular for conferencing and events, but at the moment that’s just not a possibility.” ▲ The resort will occupy a site that includes a working vineyard. Site selection proved crucial for the project, Tripolone said, and multiple locations were evaluated before the Hoffnungsthal Road site was selected. The resort design incorporates materials sympathetic to the surrounding landscape, including repurposed stone excavated from the site, rusted metals, painted concrete and natural colours. “We’re looking at a modern design and modern structures and materials, but really, we want to make it so you don’t need to look out the window to know where you are,” Tripolone said. “The Barossa Valley has quite a red hue, there’s quite dry vegetation, beautiful timbers and gums. You can bring all of that into the hotel.” The resort’s construction would feature a tiered design integrated into the hillside, ensuring minimal visual impact despite its substantial scale. This approach allowed for a longer, less imposing structure that achieves the necessary scale while avoiding a bulky appearance, he said. “We’re building towards the upper end of the hill which gives us wonderful vistas. And, given its lowrise running of about three to four storeys, once layered in, it would only appear to be a two-storey building above the top of the hill,” Tripolone said. The design accommodates strict local development controls, and Tripolone said that extensive environmental impact studies under way were “looking quite positive”. ▲ An artist ’ s impression of the InterContinental Barossa Resort &amp; Spa. At around $667,000 a key, the estimated $100-million development cost included infrastructure requirements such as water, power, and other essential services, which Tripolone said was “a very workable number” compared with other luxury projects within IHG’s portfolio. And the 25-year management agreement between IHG and Strategic Alliance signalled long-term confidence in both the development and the destination. “Where I see relationships and these partnerships work the best is where you take a long-term vision,” Tripolone said. IHG’s regional hotel strategy extended beyond the Barossa, and Tripolone confirmed the group was exploring opportunities to leverage its brands across regional Australia, primarily in premium and mainstream segments. “We’re looking to expand into regional in a big way, primarily in the premium and mainstream space,” he said. “We’re working on some ideas now, talking to some local partners around how we can leverage some of our brands and drive a really robust IHG offering for regional Australia across New South Wales, Queensland, Victoria, and parts of Western Australia and South Australia.” But they would not be all super high-end, Tripolone said, citing InterContinental Sorrento on Victoria’s Mornington Peninsula as an example of careful—and successful—market positioning. “Wherever you develop luxury, you need to have access to really good market fundamentals, infrastructure and employment,” he said. ▲ InterContinental Sorrento Mornington Peninsula. The InterContinental Barossa project complements the $80 million Oscar Hotel at Seppeltsfield, which received a $3.5 million government loan in 2024 through South Australia’s Economic Recovery Fund. Australian investment firm Salter Brothers also recently acquired the historic Kingsford Barossa property as the debut location for its new Ardour Hotels &amp; Estates brand . While acknowledging the Oscar development, Tripolone expressed confidence in InterContinental’s distinctive positioning. “These projects aren’t easy to get off the ground. [Their project] is quite significantly smaller than our project and really quite a different type of project,” he said. “We’re premium, we’re bringing an international brand, we’re bringing InterContinental, event space—we’re bringing quite a different type of project to what they’re doing.” According to government figures, the development would generate $70 million to $100 million in annual economic benefits for the Barossa region, creating more than 350 jobs during construction and 120 ongoing operational positions. The InterContinental Barossa Resort &amp; Spa adds to IHG’s luxury and lifestyle portfolio, which includes 22 open hotels and nine in the pipeline across the Australasia Pacific region—and Tripolone hinted at another significant announcement coming soon. “We’re looking to join the dots more broadly. For us we’re just filling the obvious gaps in the market and building a stronger network across Australia and New Zealand.”

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Leon Della Bosca
Mon 31 Mar 25

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Hotel & HospitalityLeon Della BoscaMon 31 Mar 25

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