COMPANY PROFILE: Al Hamra Village CFO Mark Hawkes
Al Hamra Village CFO Mark Hawkes reveals the reasoning behind the closure of the group’s hotel operating arm and the signing of the region’s first Waldorf Astoria
Hilton Worldwide is on track to launch the region’s first Waldorf Astoria in the first quarter of 2013, set within a huge new build being developed by Al Hamra Group in Ras Al Khaimah, but that wasn’t always the plan for the palatial property.
A quick surf of the Al Hamra Village website reveals no mention of the high-profile Waldorf Astoria, instead visitors find the remnants of the UAE-based developer’s earlier visions for ‘Al Hamra Palace Hotel’.
When Al Hamra Group launched its Hamra Hotels and Resorts operating arm in 1996, its mission — as still outlined on the website — was to develop and operate unique hotels, and become a leading hotel operator in the region.
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However, 16 years on and it has decided to leave operations to the professionals. As of this year, the operating division no longer exists and Hilton Worldwide has been brought in to launch Al Hamra Group’s flagship hotel development under the premium Waldorf Astoria brand.
“We took a strategic decision to focus on our core business which is real estate development and investment and that is why Hilton has been brought in — not Hilton specifically, we went through a process to identify operators — but we bring international operators to manage our hotel products now,” Al Hamra Village chief financial officer Mark Hawkes tells Hotelier Middle East.
The scenario echoes that of another local company — Al Habtoor Group — which, after a stint at developing and operating all of its hotels, handed many of its management contracts over to operators including Hilton and Starwood.
Asked why the change of strategy was necessary, Hawkes says he anticipates greater revenues from having a global management company onboard.
“The distribution network of an international operator is much stronger than we can achieve on a standalone basis, and the guest experience is improved.”
“We just identified a business case where we could achieve better returns by bringing in an international operator — the main thing is distribution — being able to bring tourists to the destination,” he adds.
Interestingly though, not all of the impressive-looking hotel will be operated by Hilton. A significant portion comprising 147 suites is being managed completely separately by a small UAE-based operator called Casa Hotels & Resorts, under the name Al Hamra Palace Beach Resort.
A spokesperson for Hilton emphasises the Waldorf Astoria and the Al Hamra Beach Resort are not associated and will be operated completely independently “with separate entrances, services and common areas”.
Hamra happenings
With the new direction, Al Hamra Fort hotel in Al Hamra Village, formerly operated by Hamra Hotels and Resorts, is being converted into Al Hamra Golf and Beach Resort, to be run by Hilton too.
A US $27.2 million revamp of the hotel is underway, to launch at the same time as Waldorf Astoria. It covers eight F&B outlets, 266 rooms and villas and a 1000-capacity conference centre.
Beyond 2013, Hawkes says most plans involve the wider Al Hamra Village development covering an area of 2.5 million m², and already comprising 1000 villas and townhouses, 2500 residential apartments, an 18-hole golf course, a marina and a shopping mall.
“There are a few underdeveloped parcels of land which we intend to complete once we’ve identified a demand for inventory in those areas, but beyond that — in line with RAK’s growth strategy for tourism we’ll probably be looking at additional hospitality-type developments… initially just in RAK. We’re pretty optimistic about the growth prospects of the tourism sector,” says Hawkes.