TTN talks to leading hotel chains in the Middle East to find how they have performed in 2003 and what’s in store for the new year.
It may have been a roller coaster ride for the hotels in the Middle East in 2003, but the year ended with most of them on top of it all , with the industry by and large rebounding from the Iraq war, the global economic slowdown and the SARS fallout to report a robust year.
These results were obtained from an exclusive TTN survey of the industry.
Most of the chains - the Fairmont, the Four Seasons, the Hilton, the Inter-Con, the Starwood, Jumeirah International, Shangri-La, the Meridien, The Metropolitan, The Radisson SAS, the Ritz, the Kempinski and the Rotana - had good results and are upbeat over business prospects for 2004.
Kempinski Middle East vice-president Ulrich Eckhardt says if the political situation in the region remains stable, he has high expectations for its hotels in UAE and Kuwait this year.
The several of the chains are pinning their prospects on regional business, some also have placed their bets on the European market: ‘‘We believe that in late 2004, the region will benefit from an increase in European leisure demand,’’ says David Crowl, Four Seasons vice-president, sales and marketing for Europe, Middle East and Asia.
For detailed results of the survey read on....
With only one hotel in the region at present, The Fairmont Dubai, we have had an exceptional year with our main focus being the consolidation of our position as one of the leading city hotels in Dubai, says Stephen Banks, regional director of sales and marketing. Despite the Iraqi conflict impacting on inbound business, The Fairmont Dubai fared exceptionally well due to the strength of the GCC market and a shift in travel patterns due to the SARS crisis and a downturn in international travel outside of the region.
Strategy adopted to face up to the downturn in global economy: The increase in GCC-generated business has offset any global economic trends. Should different conditions prevail then we will adapt our strategies to target other markets.
Did things go according to plan? Things went exactly according to plan and even exceeded our budgeted expectations finishing 13 per cent above budget.
Fairmont Hotels and Resorts maintains an interest in development in the region and will consider further opportunities with local partners should they arise.
Strategy in the face of competition: When we opened in 2002, we brought a new name into the market and were an unknown entity on the Dubai hotel scene. Our focus over the last two years has very much been on positioning the hotel and communicating the Fairmont Hotels and Resorts brand values and mission to the region along with establishing a reputation for exceptional service and flexibility. We will continue with this direction in response to the burgeoning five-star hotel market in Dubai.
Is Fairmont Hotels and Resorts bullish about 2004 and, if yes, why? In order to succeed in this highly-competitive market we all need to adopt a positive or ‘bullish’ attitude. With new hotels coming online on a virtually monthly basis a proactive and direct approach to business is a prerequisite not an option. With the third quarter reopening of the Dubai International Convention Centre opposite The Fairmont Dubai, business levels from the various trade shows have been excellent and this seems set to continue into 2004 and we are forecasting a very strong year.
What guests can look forward to: This month, we will launch our new weekend Champagne Brunch on One, at our award-winning restaurant Spectrum on One. This will be a full-gourmet experience aimed at the upper end of the Dubai market and will allow us to give our regular diners the opportunity to enjoy the Spectrum on One product for a unique weekend lunchtime affair. On the rooms side, we will be concentrating on maximising our suite and Fairmont Gold (club level) product within the GCC market.
65 and counting
How the chain performed in the Middle East: After the obvious impact of the war in Iraq, our hotels in the Middle East saw a rapid and dramatic surge in business, says Denis Johnson, vice-president, sales and marketing, InterContinental Hotels Group, Middle East and Africa. The summer was particularly busy in the UAE, Lebanon, the whole of the Red Sea in Egypt as well as Cairo itself.
Strategy adopted to face up to the downturn in global economy: Inter-regional traffic across the whole of the Middle East has been bouyant this year. With signs of economic improvements in the world’s major economies, we are confident 2004 will be an excellent year.
Did things go according to plan? There are too many external influences that affect our business to expect anything to go completely to plan. At the InterContinental Hotels Group we pride ourselves in setting a sales and marketing strategy, which is backed up by contingent tactical programmes. In this way, we can be pro-active during times of stability and swiftly reactive if market conditions change without prior warning.
Expansion plans: InterContinental Hotels Group will begin another new phase of expansion to reinforce the company’s position as the largest hotel operator in the Middle East. In addition to three new hotels opening this year in Egypt and three more also under development, the company is looking towards a number of other new projects at city and resorts destinations across the region.
The first of the new hotels, the InterContinental Abu Soma Resort Red Sea, will open its doors to guests on Egypt’s Red Sea Riviera in April this year. Within three months the InterContinental Heliopolis Cairo will become Egypt’s fifth InterContinental property when it opens as part of Citystars Heliopolis Cairo, a $600 million development combining shopping, entertainment, office and residential facilities in the Egyptian capital. Towards the end of the year, Holiday Inn Resort will open at Taba in Egypt, giving InterContinental Hotels Group a total of 65 InterContinental, Crowne Plaza and Holiday Inn hotels under management in the Middle East. A new InterContinental hotel at Aqaba in Jordan and another Holiday Inn property at Heliopolis in Cairo are on schedule to open in 2005, and early the following year the Holiday Inn Resort Dead Sea will open in Jordan.
Strategy in the face of competition: To leverage our three distinct brands (Intercontinental, Crowne Plaza and Holiday Inn) and continue to develop the product and service enhancements that we have been rolling out over the last couple of years. These two points along with our unrivalled distribution over the region, gives us a competitive advantage no other hotel company in the Middle East can offer the same.
Is InterContinental bullish about 2004 and, if yes, why? Yes, inter-regional traffic has developed nicely and is here to stay.
What guests can look forward to: The InterContinental Hotels Group will continue to open new hotels in 2004 giving our customers even greater choice of location and brands. We are also continuing to improve all aspects of service and product in direct response to what our guests tell us. 2004 will be an exciting year for us.
Kempinski marks milestones
How the chain performed in the Middle East: 2003 saw two major events for Kempinski in the Middle East. First, Ajman Kempinski Hotel and Resort, pioneer property of the group in the region, celebrated five years of successful operation and 2003 was an exceptionally good year for the hotel, which managed to achieve its challenging budget and an average occupancy close to 80 per cent despite the critical first half of the year. And secondly, Kempinski added a second feather to its Middle East hat with the addition of the brand new Kempinski Julai’a, Kuwait which opened in February last year. Now that the situation in the region is stabilising, Kempinski Julai’a is rapidly establishing itself as a favourite holiday destination among Kuwaiti and GCC families, which appreciate the resort’s unique facilities such as the Family Entertainment Centre, activities for kids of all ages, watersports and landsports, says Samer Achcar, director of sales and marketing, Kempinski Julai’a Hotel and Resort.
Strategy adopted to face up to the downturn in global economy: The hotel’s strategy was to secure key pieces of business guaranteeing the volume in uncertain periods, and optimising profitability and yield in the busy periods, says Roland Obermeier, director of sales and marketing, Ajman Kempinski Hotel and Resort
Expansion plans: With five years of high occupancy behind it, Ajman Kempinski Hotel and Resort is looking into upgrading its Executive Club Facilities, enhancing connectivity and introducing additional services for the increasing number of high profile visitors and regular Kempinski guests. On the other hand, Kempinski Julai’a Hotel and Resort will be launching a Softouch Ayurvedic Centre, providing authentic Kerala massages, treatments and Ayurvedic programme.
Is Kempinski bullish about 2004 and, if yes, why? Provided that the political situation in the region remains stable, we have high expectations for our hotels in UAE and Kuwait this year, says Ulrich Eckhardt, vice-president, Kempinski Middle East.
What guests can look forward to: Big announcements about Kempinski developments in the region are coming up in 2004, informs Eckhardt. Also, our discerning guest can rest assured of the same superior standards of service combined with an individual style that Kempinski’s luxury hotel collection is renowned for in our existing properties.
Keeping up traditions
How the chain performed: 2003 was an excellent year for Jebel Ali International Hotels as a whole, with all the properties performing incredibly well and showing very high occupancy from May onwards, says Justine Howard, Director of Marketing. We received a lot of support from local and international tour operators.
Strategy adopted to face up to the downturn in global economy: Dubai as a destination recovered very quickly from the effects of the war in 2003, and due to the diverse market mix that we enjoy at Jebel Ali International Hotels we were able to take advantage of this, and did not have to look at reducing our rates drastically.
Expansion plans: We have a number of exciting developments under discussion for this year and are confident that these will come to fruition.
Is Jebel Ali International bullish about 2004 and, if yes, why? We are confident about 2004 and very much looking forward to the year ahead.
What guests can look forward to: We will continue to offer our guests excellent standards of service, accommodation and facilities and uphold our tradition of hospitality and excellence.
Firmly focused on region
How the chain performed in the Middle East: Despite the fact that we had two months of conflict earlier in the year, we strategically refocused our sales and marketing efforts to capitalise on the high volume of inter-regional business and leisure travel. As a result we were successfully rebounded across the region, and subsequently we had very good year, says Osama Hirzhalla, area director of sales and marketing, Middle East and Africa, Marriott Hotels.
Strategy adopted to face up to the downturn in global economy: By re-focusing our efforts on the regional traveller’s specific needs we saw a dramatic improvement in our figures.
Expansion plans: There’s the Renaissance Golden View Hotel opening in Sharm El Sheikh, Egypt, opening next month, followed by Courtyard by Marriott Hotel Kuwait City, then there’s Courtyard by Marriott Hotel Dubai Green Community, opening in the middle of the year, Aqaba Marriott Hotel and Resort in Jordan opening in 2005 and Marriott Executive Apartments Bahrain opening in 2006.
Strategy in the face of competition: We will continue to focus on our customers loyalty. We will endeavour to grow our Marriott rewards membership and continue to strengthen our partnership with our strategic airline partners.
Is Marriott International bullish about 2004 and, if yes, why? As a global hotel chain we are always confident in our services and hospitality expertise. We fully expect that Marriott will continue to be one of the region’s leading hotel groups and through the professionalism of our associates we will continue to meet the hospitality demands of our regional and international business and leisure customers.
What guests can look forward to: In 2004, our customers can expect continued Marriott service excellence and value that is synonymous Marriott’s regional hotel brands, says Hirzhalla. I would like to take this opportunity to say thank you to our customers for their loyalty to the various Marriott brands and properties throughout the region. We would also like to thank our associated for their hard work, dedication and commitment to service excellence.
Year of the Bull
How the chain performed: The Metropolitan Hotels performed very well in 2003 and, overall the revenue trends signified a very optimistic outlook, says Sanjay Luthra, Director of Business Development.
Strategy adopted to face up to the downturn in global economy: Our strategy was basically linked with a very pro-active approach which enabled us to develop opportunities from new market as well as help us to strengthen our working relationship within the existing markets, to achieve our goals and counter any downturn trends in the global economy.
Did things go according to plan? Our strategies paid off and things went even better than what we had planned.
Expansion plans: The Al Habtoor Group has just announced another unique development at the Jumeirah Beach, which further underlines the company’s commitment to the city’s booming tourism industry. The new project is the new Metropolitan Beach Resort Towers and it is an extension of the existing Metropolitan Resort and Beach Club. The five-star hotel, consisting of two towers, will have three levels of underground parking, and will host several international and theme restaurants.
Strategy in the face of competition: Our key strategy is to ensure that we are providing value for money and look after and develop our existing business as well as be constantly innovative in developing new markets.
Is Metropolitan bullish about 2004 and, if yes, why? Yes, the Metropolitan group is bullish in 2004 because our strategies are realistic and well in place to reflect a positive trend.
What guests can look forward to: Guests could look forward to be additionally pampered the “Metropolitan way” where guest comfort is of prime concern.
How the chain performed: We have performed exceedingly well and the average annual occupancy for the group of 17 hotels exceeded 76 per cent last year, informs Nael Hashweh, vice-President, finance and development of Rotana Hotels Management Corporation Ltd.
Did things go according to plan? In fact, Things were better than we planned despite the decline of business in March and April due to the Iraq War, the total revenue of Rotana’s 17 hotels exceeded US$120 million - this was $5 million above the budget and over $ 25 million above 2002 (an increase of over 25 per cent).
Expansion plans: Last year, Rotana signed the management agreements with the following hotels: Coral Beach Montazah in Sharm El Sheikh, Coral Beach Hurghada in Hurghada (both are already operating in Egypt), Raouche Rotana Suites opening in Beirut in mid 2005, Hazmieh Rotana Hotel opening in Beirut this month, Doha Rotana Hotel opening in 2006, Kuwait Rotana Hotel opening in 2005, Al Raha Rotana Resort opening in Abu Dhabi this year, Villa Rotana Suites opening in Dubai in 2005 and Jumeirah Beach Rotana Resort and Financial Market Rotana Tower both opening in Dubai in 2006.
What’s more, Fujairah Rotana Resort will open in 2006 and Damascus Rotana Suites will open in the middle of this year. And, by the end of 2006, the number of Rotana Hotels is expected to double up and will exceed 30.
What guests can look forward to: Among other the fact that Towers Rotana Hotel, situated on Sheikh Zayed Street in Dubai, has just joined the Great Hotels of The World ‘Incentive and Business Travel is great news. Headquartered in the UK, Great Hotels of the World represents the world’s greatest hotels and resorts in five niche market sectors: family, golf, romantic, spa and incentive and business travel. Membership of Great Hotels of the World is by invitation only and is limited to exceptional hotels within the recognised niche lifestyle sectors. All of the hotels that have been selected to join Great Hotels of the World have had to meet certain criteria of minimum operating standards thus ensuring that those included are among the world’s most luxurious properties.
How the chain performed in the Middle East: The Shangri-La Hotel, Dubai, the hotel chain’s first property in the Middle, soft opened on July 8 and room occupancies have been very encouraging. High-profile global events such as the IMF helped greatly to establish the hotel in the international market place, says Bernhard Haechler, general manager, Shangri-La Hotel, Dubai.
Strategy adopted to face up to the downturn in global economy: The hotel opened post SARS and following the conclusion of the war in Iraq, when there was a marked downturn in international travel. However, this allowed us to fine-tune our services and facilities and to extensively train our staff. The highly attractive and well-positioned opening room rate helped to attract new customers in the competitive market and an increased travel trade commission of 15 per cent was introduced to promote the property.
Did things go according to plan? By and large, we have been very pleased with the results to date in what was and remains a very competitive market.
Expansion plans: The Shangri-La Hotel, Dubai will be fully completed in 2004 with the addition of the exciting night entertainment venue featuring live entertainment and innovative food and beverage concepts on Level 42 of the hotel. In addition, the soft opening of the group’s four-star Traders Hotel is scheduled early this year. The hotel will offer the budget oriented business traveller 250 rooms and two food and beverage outlets. In 2005, the luxurious and comprehensive Shangri-La’s Barr Al Jissah Resort and Spa in Muscat, Oman is scheduled to open, and in 2006 the Shangri-La Hotel in Doha will open in time for the Asian Games.
Strategy in the face of competition: The Shangri-La introduced the Shangri-La Rate Break promotion (SRB) at the beginning of December to encourage new business while rewarding existing clientele. By simply joining the group’s award-winning Golden Circle guest recognition programme (online at www.shangri-la.com or by contacting the Reservations Department in Dubai), guests are immediately eligible for room discounts of up to 40 per cent off published room rates (i.e. a minimum room rate of Dh605++) as well as complimentary Continental breakfast, valid until the 29 February 29, 2004. There is no charge to join the Golden Circle at entry level (Classic) and repeat business is rewarded by an invitation to the Executive and Elite categories with related benefits and special offers.
Is Shangri-La bullish about 2004 and, if yes, why? The Dubai Tourism and Commerce Department (DTCM) and Emirates Airlines are aggressively promoting the destination and this heightened visibility facilitates our sales and marketing strategies. With such an active and positive national directive, we are confident that 2004 will prove a rewarding year for the hotel and Dubai.
What can guests look forward to: Guests can look forward to the completion of the hotel’s comprehensive facilities with the presidential suite coming on line in February, the opening of our seafood restaurant on level two in March and the opening of the night entertainment venue on the 42nd level late this year. This venue with spectacular, unhindered views promises guests and city residents of Dubai a dynamic new entertainment venue.
We’re now a more efficient organisation and are working on enhancing our strength and developing on opportunities we have.
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