Rotana set for 53 hotels by 2010

With 11 new hotels announced last month and its mid-market Centro brand set to debut this year, Rotana Hotels & Resorts has a lot of talk about at the ATM, says the company’s chairman Nasser Al Nowais. SHALU CHANDRAN sits down with him to talk strategy, finances and human resources
Rotana’s skyline of new properties

With nine new hotels scheduled to open in 2007, how close are you to reaching your target 42 hotels by 2008?
It is no longer, 42 – but we will be 53 hotels now by 2010.

This follows the signing of 11 new management agreements. Some of the new properties will be in Jordan, Oman, Qatar, the UAE and Bahrain. We currently operate 25 Rotana hotels and have 17 under construction.
Rotana has already opened four new hotels this year: the Al Salam Rotana Hotel in Khartoum, the Al Manshar Rotana Hotel in Kuwait, the Fujairah Rotana Resort & Spa and the BurJuman Rotana Suites in Dubai.

All your expansion plans seem aimed at the region. What about beyond the GCC?
Yes, we are targeting the GCC region, and this will continue to be our objective for the next four or five years. This is our home ground and we think it is very important to concentrate in this region, which is very promising and we don’t want to go too fast. We prefer to train our people, get the right human resources, and move forward slowly. This will ensure that we keep the quality of Rotana as priority.
Come 2010, we will have doubled our number of hotels. What we are focussed on doing now is training our people to encourage our young staff to be managers –-Rotana boasts of very young and active mangers. We believe that the secret to reaching our objective is training and more training for our staff. Human resources is a very important at Rotana.

Other regional brands like Jumeirah are already in London and New York? So isn’t the timing right, now?
We always believe in the market we know. The GCC is our market, our background, we know the culture here, we know the rules and regulations here. And most of Rotana management is from this region, which we think is a important factor.
We don’t believe it is right to expand to a region we are unaware of. Our aim to have a property located in every key city in the Middle East and this can only be achieved with careful long-term planning.We want to give quality service, which requires that we tread ahead very carefully with the right people. We are not chasing numbers, but in quality.

Is there a fear of over-supply, particularly in the emirates?
In Dubai and Abu Dhabi today, occupancy rates are very high. Both emirates have very good average room rates. The UAE is now established as a safe tourist destination.
Last year saw more than eight million arrivals in the UAE, which is remarkable. With so much being done by the tourist authorities, arrivals into the UAE will only increase, hence we need more rooms. The country is becoming more and more popular.

This year, you will also launch your Centro by Rotana brand. What is your group’s strategy for these new budget, or limited service, hotels?
We’ve spent a long time studying these budget hotels, and we’ve found that there are great opportunities not only in the four- and five- star sectors, but for one and two-star hotels too. There is great demand for middle-class business concepts. Not everyone can afford $250 for a room, not everyone wants to pay that.
What Centro will provide is beautifully conceptualized rooms, with all guest requirements but without the concept of five-star, like room service at very affordable rates. The hotels will house F&B outlets and most importantly be located in the heart of the city. Since we launched this concept, we were overwhelmed with the response we’ve received. We currently have two hotels in Dubai, three in Abu Dhabi. We will see Centro’s in Doha, Oman and Bahrain as well. The first one to open in 2009 is the Centro by Rotana Sharjah Airport consisting of a 300-room hotel at Sharjah Airport. This will be in agreement with Air Arabia and Rotana Hotels. The Centro by Rotana in Sohar will be our first step into Oman, which will open in 2009 with 300 rooms.
And yet, Centro will be the five-star of the three-star hotels. Our product is quite unique.

So can we expect a Rotana IPO?
So far Rotana has not faced any problems with our expansion plans. Sometimes when you want to expand, you need financial support and at that this may be a choice.
But maybe in the future, when we need to expand more – probably outside the region, then we will think to go or not to go.