PNGX-listed Steamships Trading Company, which owns businesses across logistics, property and hospitality, last year achieved impressive 12 per cent revenue growth. Business Advantage PNG recently caught up with its Managing Director Rupert Bray to learn about its ambitious plans to grow further.

Steamships subsidiary Consort Express Lines operates a comprehensive coastal shipping service in PNG. Credit: Steamships

Business Advantage PNG (BAPNG): How is the latest addition to Steamships’ Harbourside precinct in Port Moresby, Harbourside South, progressing?

Steamships’ Rupert Bray.

Rupert Bray: We expect the whole development to be completed by Q4 this year. But we already have carriage of the podium block, which is the retail and the office floors and so we’re advanced in conversations with tenants to start the fill-out process.

We expect the podium to be occupied from March next year. And then the Marriott opens targeting July next year.

BAPNG: Harbourside South is part of trend towards mixed-use developments, such as Rangeview Plaza and Nambawan Plaza. What makes this form of development attractive?

RB: Smaller developers are not doing mixed-use developments. They’re still doing retail-led, residential-led and/or commercial-led.

As you get bigger, you have the capacity to do larger projects. Harbourside South represents a total investment of close to one billion kina. When you’re talking about investment like that, you don’t want all your eggs in one basket, so you’re looking at diversifying some of your risk.

Second, at this stage of PNG’s development we’re still facing security challenges. So, tenants, whether they’re retail or residential or commercial, want physical security. And a mixed-use development gives them that because it’s all under one secure roof.

BAPNG: Steamships has brought the Marriott and Radisson brands into PNG. How key is that to attracting customers new to PNG?

RB: Around 85 per cent of hotel rooms in PNG still are domestically sourced, so this is still a domestic market. But PNG is increasingly open to the rest of the world and our economy is growing and it’s growing in international relevance. Many international companies have global procurement, where they favour specific brands. Marriott are on the preferred list for many of those big resources companies, so it’s a conscious choice for us to go that way.

‘The Papua New Guinean customer is becoming much more discerning. They have had the opportunity to travel some more internationally for work and for pleasure.’

Also, the Papua New Guinean customer is becoming much more discerning. They have had the opportunity to travel some more internationally for work and for pleasure. So, they’re beginning to enjoy the privileges that come with a brand association.

BAPNG: Steamships is also developing the 38-acre Portside Business Park adjacent to Port Moresby’s international port at Motukea. How is that progressing?

Rendered image of the Portside Business Park. Credit: Steamships

RB: Services are on site and the project is essentially ready to deliver into the logistics and oil and gas space. It’s being promoted primarily as a business park, and isn’t predicated on the Papua LNG project for its success.

The aim long-term is to develop downstream manufacturing, small-scale domestic manufacturing, logistics, transportation depots and warehousing.

When the port relocated to Motukea, logistics businesses gravitated out that way. We anticipate more of those going. There’s also demand for land from expanding businesses, seeking larger plots of land than they’re currently on.

Depending on what’s finally built there, Portside will represent an investment of between K500 million and one billion kina. We anticipate about a thousand Papua New Guineans will be working on that site once all these different businesses are up and running. 

BAPNG: You’re also looking to rebuild the Melanesian Hotel in Lae …

RB: Conceptually, we’re going ahead. The only discussion that we’re having amongst ourselves how large the development should be. It was a mid-size hotel with conferencing facilities and some retail before. So, the question is whether we make it more of a mixed-use development.

‘There is a lot more capacity in-country now than there was before.’

Lae doesn’t have the same degree of urbanisation and it doesn’t have a large pool of middle class and expatriate professionals in the way that Port Moresby does. However, it is the manufacturing part of the country and it is the import and export hub. So, it’s got a slightly different dynamic and you’ve got to build for that.

BAPNG: What about opportunities outside of PNG’s two major cities?

RB: One of the things that I’ve noticed even in my short time is the growth of Mt Hagen. We broke ground on a new BSP branch last year at Dobel, halfway to the airport. That is part of a K200 million, 48,000 square metre retail-led development we are starting this year in a joint venture with Tininga. It will be complete in 2025.

In terms of investment, we’re anticipating double what we’ve spent in the last couple of years in each of the coming years. That’s indicative of our confidence going forward. In addition to our big property projects, each of our four logistics businesses are also growing in their own right. There’s going to be a significant increase in logistics and shipping activity.

PAPNG: In your view, how ready is PNG’s economy for the next period of growth, compared to the PNG LNG era a decade ago?

RB: We’re much more ready than the last time. There is a lot more capacity in-country now than there was before. It’s also at a much higher level.

On the human capital side, there’s a lot more bandwidth too, although there are going to be skills gaps to meet.

The large resource companies are finding there are local solutions to every challenge they throw us. All of the support services are available in country. We’ve all got enough capacity to deal with the boom that’s coming.