Peppers Guest House



How the hospitality world changes in just 25 years ...  

20 October 2009

As Peppers Retreats, Resorts and Hotels prepares to celebrate its 25th anniversary next week, we spend a few minutes with Mike O'Connor, the original owner of Peppers Guest House.  Mike and his wife Suzi now live in Europe.  They are no longer involved with Peppers, but if you require an interview, we can facilitate this.          

An interview with the original Peppers Guest House retreat owner – Mike O’Connor

What was your vision for Peppers when you opened the doors to Peppers Guest House on 26 October 1984?

Our vision was to move to the country, build a stylish hotel, unlike anything then in existence. We decided to call it a Guest House because we didn’t want it to be a hotel in the traditional sense.

Why 'Peppers'? How did you choose the name?
We called it Peppers because the old house that stood on the site of the current courtyard (we moved the house to it’s current location and called it the homestead) was surrounded by pepper trees.

What was opening day at Peppers Guest House like?
Fairly chaotic. It was a Friday night; I was in Sydney getting the liquor license in the court and didn’t get back to the Guest House until 7.00pm. The place was packed to the rafters and we had forgotten to order an ice machine. The first chef we employed did not cope well. All very stressful.

And the opening party?
The opening party was the next weekend, Sunday I think. We had Suzi Cruckshank singing and her Jazz group playing on the lawn in front of the main building. All was going well until the biggest thunderstorm you have ever seen enveloped the valley. We had 4 inches of rain, the roof leaked and the power went out for 8 hours. It was only then that we realized that when the power was off, not only did we have no lights, but also no water. Chaos reigned for some time until we all crowed into the lounge and bar to listen to Suzi sing around the piano. We drank and feasted on anything that could be cooked on a gas stove.

What was the hospitality industry like then?
Just as it is now, very competitive. There were fewer operators but also fewer visitors.

And how has it changed since?
It was very difficult to get everyone to work as a group and market the Valley as a destination. That changed over time and by the late 80’s the Hunter Valley was the most dynamic destination outside Sydney.

What were guests seeking then that they may or may not be seeking now?
I think they are seeking the same thing today they were seeking 25yrs ago. A relaxing weekend getaway in a cozy environment with good food and wine

How did you intend to set Peppers apart from competitors?
We wanted it to be everything a hotel wasn’t. Hopefully our guests would feel as if they were staying in a friends house

Has this changed?
I don’t think so

What was your biggest challenge back then?
Convincing our bank manager that although we were spending twice as much as it would cost to build an equivalent motel we could achieve an average room rate, three times that of a motel.

What do you think is the biggest challenge in retreat accommodation today?
Today there is so much competition in this sector; you need to differentiate your product.

Did you imagine 27 retreats and resorts throughout Australia and New Zealand?

What inspired you to open Peppers Guest House in the Hunter Valley?
We were seeking a life style change (at the time we owned and ran a contract cleaning business in Sydney). We looked in Thredbo and the Blue Mountains but the Hunter Valley accommodation stats showed the area had the highest occupancies and the highest room rates in NSW. We were confident that we could build the best in the area and therefore take the top end of the market. In the first 5 years of its operation the Guest House ran at an average annual occupancy above 91%

Do you keep in contact with any past guests?
No but I am constantly meeting people who have stayed there. Last weekend in the Port de Soller in Mallorca, I met an Aussie guy on a boat who attended an insurance conference at the Guest House in 1986. Needless to say we shared a few drinks.

How much did a night at Peppers Guest House cost in 1984?
Around $115

Describe your funniest Peppers moment?
Caught swimming naked in the pool house with the staff from the Cellar Restaurant by my wife Suzi, at 3.00am

And your happiest Peppers moment?
Swimming with the staff of the Cellar restaurant

And your biggest Peppers achievement?
Selling Peppers Guest House for $10 million in1989 and buying it back 2 years later for $5.5 million

Any tales of famous people who have stayed?
My lips are sealed

Where are you now?
Living in Mallorca, in a beautiful stone villa, in an ancient town called Soller

If you could open another Peppers Retreat in Australia or New Zealand now, where would it be?

Do you have any advice for the Peppers team now?
Market the product to women, because in the short break segment it is the woman who makes the decision. Men just want to be organised.

Any stories you would like to share?
We originally bought the land where the Guest House now sits from a man in Cessnock called Laurie Murphy. After concluding the sale we took him to lunch and we all had much to drink. As we were leaving he offered some fatherly advice. Clearly he had a skeptical view of our proposed project, and took me aside suggesting we should change the design so if it didn’t work as a guest house we could convert it to a retirement complex. I now wonder if he was just ahead of his time.

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