JSE-listed Redefine International's hotel arm, the Redefine BDL Hotel Group, plans to have 100 hotels in its management portfolio in two years' time, strengthening its position as the largest hotel manager in the UK.

The group said yesterday it had added 22 hotels with an average annual combined turnover in excess of £200m a year, to its 48hotel portfolio. It would not disclose the value of the contract. It is looking to secure contracts to manage another 30 hotels within the next two years.

Redefine BDL Hotel Group is 25.28% owned by Redefine International, an offshore property company that invests in commercial properties, with a dominant focus on retail in Western Europe. Redefine International is seen as a rand-hedge stock for South African investors. Redefine Properties, the JSE's second-largest listed property company that is based in SA, owns about 30% of Redefine International.

Redefine International bought the stake in Redefine BDL to diversify its income streams. Through BDL, Redefine International is offering investors significant exposure to hotels in the UK. The only other listed hotel exposure option for South African investors is Hospitality Property Fund, which manages hotels in SA. Hospitality has experienced a difficult past few years as it struggled to recover from the recession and a slump that followed the 2010 Football World Cup.

In the year to June, its distributable earnings per combined linked unit grew 14.5% to 174.8c, beating guidance marginally. Redefine BDL's CEO, Helder Pereira, said yesterday his group had just finalised a contract to manage the new portfolio of 22 hotels on behalf of LRG Acquisition. The 22 hotels used to be owned by InterContinental Hotel Group (IHG) and were now owned by LRG.

"This is very exciting. It establishes us, not only as Europe's largest manager of IHG franchised properties, but also as the UK's largest independent hotel management team," Mr Pereira said. "We have about 30 hotels which we are in negotiations to manage. They should come under our wing in about two years."

The 22 hotels under Redefine BDL's new management contract included five central-London hotels and Holiday Inns in Edinburgh, Cardiff, Glasgow and Birmingham. They added almost 6,000 rooms to Redefine BDL's managed portfolio.

Redefine International's CEO, Mike Watters, said the deal meant South African investors were being exposed to "high-calibre" hotels. He said Redefine International's main business would still be commercial property in Western Europe but having an investment in a hotel manager added a significant benefit to the group.

"Redefine BDL manages every aspect of the hotels under contract. We see having an investment in them as something which gives us more diversification and makes us a more interesting offering to investors," he said.

Hospitality and real-estate consulting CE at HTI Consulting, Wayne Troughton, said offshore hotels could bring good returns to investors next year. "The hotel industry's performance is tied to economic growth and the UK's economy is recovering," he said.

The British Chambers of Commerce recently upgraded its gross domestic product growth forecast from 2.8% to 3.1% for 2014. Hotels in BDL's new management contract include five in central London