IHG to double ME room numbers by 2010
DUBAI will be abuzz with the opening of the 150th InterContinental Hotel Dubai Festival City this month.
The new-build, 500-room property will be a big draw for UAE residents and tourists alike but is only one of five new group hotels opening this year.
The group has a healthy development pipeline across its brands, with double its current number of rooms estimated by 2010. This also includes doubling the number of Holiday Inn properties in this region.
SHALU CHANDRAN sits down with John Bamsey, COO, Middle East and Africa, IHG, to find out more about the hotel and about the group’s plans for the region.
As one of the largest hotel operators in the region, how has IHG grown over the last few years?
We currently have 78 hotels and will open another five hotels by year end. Our pipeline of new hotels beyond 2008 is also strengthening. We plan to open 23 new hotels next year and by 2010, we could be looking at doubling our room count in the Middle East and Africa. The expansion will be throughout the Gulf as well as in Egypt, Jordan and Lebanon. Inspite of the difficult times, Lebanon is a market that is known to recover fast, so we are looking forward to it. South Africa is a new market for us where we will are expanding quite significantly with Holiday Inn Express, building on the previous Holiday Inn franchise brand equity.
So will you continue to concentrate on brands already in the region or are there plans to launch other IHG brands like Hotel Indigo or Candelwood Suites?
Our brand portfolio is segmented across the consumer market – so we have the InterContinental, which is top-end; the Crowne Plaza, which in the Middle East is a five-star hotel; the Holiday Inn which sits at the top-end of the mid-scale, and now the Holiday Inn Express which sits in the limited service end and is a new segment for the Gulf. In addition, we have Staybridge Suites for the long-stay market. It is different from the InterContinental Residences, which has more annual stay contracts.
We do not have any immediate plans to launch other brands here for the simple reason that we have got such phenomenal development activity with the existing brands. There is no point in confusing the market at this point.
In particular the region shows a lot of opportunity for Holiday Inn. We are definitely going to see a doubling in the number of Holiday Inn properties in this region. That will lead to upgrading the existing properties and you will see Holiday Inn take on a new position in the market place, both in terms of consumer and trade.
What has been the response to the Holiday Inn Express brand?
It has in fact surpassed expectations, bearing in mind that we opened during the summer and did miss some of the key contracting. Our forward bookings for the next two months are exceptionally good and we are very confident that the brand is going to outdo itself. We have another two-three properties that have been announced and in the pipeline.
What response do you expect from your second mixed-development project at Dubai Festival City? Can we expect to see more such developments in the region? And why are they important in the global hospitality sector?
It is more about understanding the opportunities available in each city with individual developments and projects. We think there is a lot of mileage within a mixed use development, and InterContinental and Crowne Plaza can act as anchors in a mixed-use shopping development.
Mixed-use developments are not really a new concept. They exist around the world and will undoubtedly grow further depending on demand. If you have a got a shopping mall or a mixed-use development that is generating its own demands, then there will be a reason for a hotel. The hotel then creates its own demand, which then supports the mall and you have two pieces and one and one makes three rather than two. It’s the added value that everybody brings to the party.
What are the longer-term goals both for IHG and for you?
IHG have stated development targets of 60,000 rooms by the end of 2008. And we sit as part of that and we can be a major attributor. Globally, the company’s major development focus is in China, which is expanding rapidly, but there is a lot of high growth here in this region too. As part of IHG’s global strategy, great hotels guests love is a key mission, so part of my job is to make sure that we have got the organisation capability to deliver the brand promises and we can achieve that mission.
Have you started taking bookings for the new Festival City properties?
Well, an interesting story to tell is that we recently had a guest who walked into our Festival City property asking to book a room! So no, we are not yet officially open for business, but our customers are ready to move in. Dubai is a strong market and therefore we have got pre-bookings for conferences, but we open our websites and holidays system once we have a clear opening date. We will definitely see a soft opening for the InterContinental in the first week of November, the Crowne Plaza will be about four weeks behind that and as we go into the New Year, we will have official openings. The hotels will be fully operational by January.