Opening up opportunities
For Elie Younes, VP business development MEA, among the priorities on his agenda is filling the gaps in his region, those countries without a Rezidor presence, and his pursuit of opportunities is paying dividends.
“Qatar and Amman can be assumed to be missing links for us, and we hope to make some exciting announcements in these markets in the near future — notably in Qatar,” says Younes.
“While Radisson Blu will always be our focus, we believe there is tremendous opportunity for Park Inn by Radisson, especially following success in Muscat, Yas Island and Al Khobar — where our hotel recently won the best midscale hotel award in KSA.”
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Expansion in Saudi Arabia is on the cards, in both gateway and secondary cities, plus a focus on Egypt when the market recovers and other opportunities in North Africa.
“We are also focused on securing a couple of resort properties in the UAE, notably Dubai, which would perfectly complement our portfolio from a revenue generation perspective, and hence secure a better ROI for our partners/owners and ourselves,” says Younes.
While current events have had an impact on investor sentiment in the market, he said many developers were from the region, and as such they were to a certain extent used to political instabilities: “This, combined with the fact that the region, and notably Egypt, has proven to be very resilient to political upheavals in the past, can reasonably suggest that such an impact will be short-lived”.
The group has no plans to introduce Country Inns to the region, but one key element of its expansion strategy is paying dividends with an increasing number of management takeovers under its belt.
As well as the JAL properties, Rezidor manages the former InterContinental in Deira, Dubai, the Crowne Plaza Sharjah and two Hyatt Regency hotels in KSA, enabling quick entry to key destinations.
“Part of our strategy is the taking over of existing properties, creating a healthy mix with new-built projects,” says Younes.
One key advantage in this route is the bouquet of design concepts offered by Rezidor, with recently launched And Relax, Naturally Cool, NY Mansion House, Ocean and Urban room types.
“Our room designs are efficient, contemporary and cost-effective ready-to-go packages for conversions and owners looking for a quick fix,” explains Younes.
“Some owners see the benefit in time and in cost in choosing one or two concepts for their properties — Naturally Cool and NY Mansion House are perhaps the most suitable for this region and they will be used in the renovation of the Radisson Blu Kuwait, but the Radisson Blu Muscat recently used the And Relax and Ocean concepts for their rooms and Urban might be suitable for hotels located in business areas of a city.”
Key for all developments is the brand promise, which delivers clearly identifiable experiences/ventures to guests and owners alike: “All of our brands are design conscious and they are cost and investment efficient,” stresses Younes.
Certainly, owners are now looking beyond glitz to ROI, according to Hytönen, who says: “There is a lot more preparation done prior to projects now than there was in the past. Owners are more cautious but also more flexible,” he said.
“They are open to considering more options, for example, economy or mid-market brands.”
For global director of sales and marketing, Yigit Sezgin, maintaining business levels has been a challenge in 2011, with regional events mitigating the recovery from the global financial crisis, but he is upbeat about overall prospects for the MEA region.
“While business has been impacted in Egypt, Libya, Bahrain, Tunisia and Lebanon, we have seen a large portion of this business shift to other cities, having a positive effect on destinations such as Dubai, Sharjah, Fujairah and Istanbul,” he says.
“The figures are showing slowly but surely that the areas that were affected earlier in 2011 are improving — in other developments, I believe a second wind of supply growth in Abu Dhabi can challenge current performance, but Dubai will continue to grow and strong oil prices will drive economic activities in countries such as KSA.”
A growth in religious tourism will boost Makkah hotels, and stabilisation on occupancies in mature markets give rise to optimism that room rates can rise, but only in those cities unaffected by turmoil, he adds.
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