The legend goes that more than two decades ago, SA's most famous hotelier flew in a helicopter over a barren and dusty patch of land near Rustenburg.
He saw potential where others saw bush; had a big vision and the rest, as they say, is history.
WHAT IT MEANS
 Location is everything in building a hotel
Perceptions can make or break a business
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Aviation, vision and dusty land also played a key role in the formation of the Birchwood Hotel & Conference Centre eight years ago.
At the time, cofounder and MD Kevin Clarence had been working construction in Sandton and was site-managing the building of two hotels. But he wanted his own piece of the action.
He admits he knew nothing about the hospitality business but someone told him if you're going to build a hotel, location is the most important thing, followed by two other important aspects, location and location.
So he started scouting around. Sandton was an obvious option. He knew the place well. Nelspruit was also a possibility. He'd heard stories of huge growth potential in Mpumalanga, and Boksburg was also on his radar screen. While his colleagues laughed at this last choice - "who'd stay willingly on Johannesburg's East Rand?" they asked - he figured proximity to the airport and the cost of land worked in his favour.
And here's where aviation played a role in the creation of his business idea, an idea now turning over more than R10m/month and 100%-owned by the JSE-listed Hospitality Property Fund.
The fund is SA's first specialist listed property fund invested exclusively in hotels and resorts. It comprises a portfolio of 16 landmark hotels, independently valued at R1,11bn including the Mount Grace Country House & Spa; Champagne Sports Resort; Radisson Hotel Waterfront; Courtyard hotels in Arcadia, Rosebank, Sandton, Cape Town and Eastgate; and Protea hotels in East London, Port Elizabeth and Richards Bay.
Stellenbosch-educated Clarence found an open piece of land across the busy Witbank highway diagonally opposite what all pilots know as runway "zero three right", the main landing strip at Jan Smuts airport (now O R Tambo International).
Notes Clarence: "People thought I had lost my mind but I had also been told the area was one of the fastest-growing business and industrial zones in the country. And if people were going to do business there, they were also going to have somewhere to sleep and eat."
Clarence and his father Brian - well known in property circles in Johannesburg - put up R5m of their own; borrowed the rest and started the construction of 80 rooms and a small conference centre.
Clarence admits fear of failure influenced his decision to build "outwards instead of upwards" so if the hotel idea bombed, the multiroomed clustered units could be sold as townhouses or even as an old age home.
But from day one the concept found traction. Clarence attributes this to two factors: "For the first few months we told anyone involved in the travel industry that they could spend a night or two for free. It was great marketing. And our opening coincided with the closure of the World Trade Centre Hotel ahead of the construction of what is now known as Emperor's Palace. There was an accommodation vacuum in the area and we filled it."
They say people always remember the amount of their first pay cheque. In Clarence's case, he remembers his first month's turnover.
"It was R163 000. Not bad for a guy and his old man who knew nothing about the hospitality industry. Part of our success I think was our initial ignorance of the complexities of the hotel business. We made our plans on the back of cigarette boxes and got involved in everything from HR to laundry."
The years 1998 to 2000 were a water-shed time for the Birchwood. During that time the centre grew from 80 rooms and a single conference facility to 156 rooms and four conference rooms. Clarence talks about another R10m loan and the huge risk attached.
"But it was a calculated risk. We were running at a virtual 80% accommodation and conference occupancy and we knew it was time to grow when we realised we couldn't keep feeding people from the local Spur (still on the property). Though the offering was excellent and is to this day - we needed more variety."
Clarence snr and jnr say that at that point they also learnt something about hotel yield management. While they were bursting at the seams, high overheads were not necessarily turning into the kind of profits they wanted to realise and the only solution was to grow bigger.
In 2001 the Birchwood saw the real potential of the country's burgeoning conference industry and its first big conference centre was constructed. It was a monster 2 000m² edifice which contained five rooms and state-of-the-art equipment.
And still the business continued to grow. There were further additions, including the construction of the second Atrium conference centre with room for 900 people and in 2005 the addition of a further 94 rooms and an outdoor lapa with space for as many as 800 delegates.
The Birchwood now has 330 rooms and 18 different conference venues. So where does it end?
Says Clarence: "Who knows, the land is certainly available. Maybe in time as many as 1 000 bedrooms."
So no-one can ever accuse this 34-year-old entrepreneur of not thinking big.
In spite of the success of the Birchwood, Clarence is refreshingly honest about the perception challenges that he's still facing.
"Boksburg is still Boksburg and in spite of having a world-class conference venue in the best conference location in the country, people still raise their eyebrows. It's nonsense of course, we have had most of the major SA corporates holding functions here and the feedback has always been positive.
"I'm used to the East Rand jokes, but people must see the area for what it is, honest, hard working and in many ways the heart of this country's economy."
