Rendering of The Westin Hotel & Spa (Abu Dhabi): Westin will make its debut in the emirate this year, marking yet further expansion for the brand.
With nine brands, Starwood Hotels & Resorts has a strong hand to tempt developers. Kathi Everden shows how the group is seeking to reinforce its dominant position in the Middle East.
Vice president and regional director for Starwood Hotels & Resorts in the Middle East, Guido de Wilde is fluent in eight languages — seven European tongues and Starwood speak, a dialect he has perfected over 28 years with the group spent in destinations as diverse as Bahrain, Morocco, Germany, Belgium and Portugal.
Now in to his sixth year heading up Starwood operations in the Middle East from Dubai, de Wilde clearly relishes his role spearheading the roll-out of new brands across the region as well as consolidating the group’s dominance in his home territory — the UAE alone accounts for nearly half of Starwood inventory in the region.
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And, despite the yelps of pain from most hoteliers in the region during the dark days of 2009/2010, de Wilde is sanguine about the effects of the past two years on the hospitality sector, attributing much of the revPAR loss to new stock coming to market.
“Occupancies for us in the Middle East in 2010 have been in line with 2009 and never far off the peaks of 2008,” he said.
“Where everyone has struggled is with rate, specifically in 2009 and to a lesser extent in 2010 with rates dropping particularly for Dubai and Abu Dhabi — but these declines were driven by increases in supply to a great degree.”
This situation is one that did not affect other markets such as North America and Europe, he argues: “There is not much growth in capacity coming on line (in these regions), but here, even during the financial crisis, new hotels were being constructed and we will see further growth in 2011 with 7500 rooms in the four- and five-star category opening in Dubai for instance as well as a 49% increase in inventory in Abu Dhabi — this has to have an impact on the market.”
What is spurring confidence in the Starwood camp is the upturn seen beginning in December that has carried through to 2011.
“We have seen a turn round especially in the UAE markets, with beach revPAR showing an increase over 2009 — this has continued with January and February figures and clearly December marked a curve shift that makes me cautiously optimistic,” said de Wilde, adding that revPAR and occupancies for the rest of the region for 2010 performed in line with 2009.
“For us, Q1 has been good across the region and looking at current trends, I believe the momentum of growth is positive.”
In addition, two other factors are contributing to Starwood’s feel-good factor: new names in the portfolio and an overall revenue upturn.
“We are pleased with our operations in cities such as Doha and Abu Dhabi, where we have introduced new brands (W and Aloft) in declining markets and seen a great performance,” said de Wilde.
“Another good indicator is that total revenues were up in 2010 over the previous year — we don’t always have to talk about revPAR as many of our hotels are strong on F&B and these revenues were up and in some cases even exceeded room revenues, which is quite a unique situation.”
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