US-based Choice Hotels International is intent on rolling out its mid-market brand Comfort to the Middle East, president and CEO Stephen P. Joyce mentioned during a hospitality industry session highlighting global CEOS at the 2017 Arabian Hotel Investment Conference (AHIC) in Dubai. Joyce also highlighted the potential for Choice brand, Clarion, in his talk.
"The brands that we’re bringing here are ones which we think will work really well. We think there’s real opportunity for Clarion, real opportunity for quality in a three to four-star opportunity; there’s food & beverage but limited. The real opportunity is in Comfort, which is a lodging product that's select service-focused, provides breakfast, quality bedding, good sized rooms and can fit families in a comfort suite. Suites are outstanding for families because they’re double double, have a pull-out couch, and provides value for families whether they’re travelling for religious purposes or leisure but also for business travellers as well. We think that the time is right and this is our expertise," Joyce declared on stage in conversation with AHIC co-founder and Bench Events chairman Jonathan Worsley during a discussion entitled "Session: Global CEO Series - Catalysts of Change".
Joyce also said that in the mid-market space, what both owners and investors, as well as end consumers, ultimately look for is value. "You have to present the value to families and travellers looking for the experience that represents quality but doesn’t necessarily give lots of frills that they don’t want."
He continued: "Historically if you look at this region, you can pull away the chandelier and the marble but not change the operating model. The operating model should be – there should be 20 to 25 employees in the hotel. It should run very high margins, very low CAPEX to get in, relatively high margin production and be low cost to operate but at the same time, satisfy guests needs in a way that isn’t being done currently.
If you look at Choice, we’re almost 7,000 hotels - we have brands from upper economy to upper upscale but in each case, it represents value across the board."
When questioned, Joyce confirmed that Choice already has an active pipeline in the Middle East, with a focus on the UAE and Saudi Arabia, following its strategic agreement finalised last year with Equinox and Al Tayyar Travel Group, as previously reported in Hotelier Middle East.
"The two target markets that we’ve outlined are the UAE and, in particular, Saudi Arabia," he said.
He explained: "What we’re seeing in Saudi is 15 sub-markets which are clearly in need of quality moderate to large lodging where there’s a strong middle class that is doing all the things we’re all accustomed to, selling insurance, selling computers, selling whatever is required to service the various industries across those markets, and leisure travellers who do not have great options today."
"What they really want is a simple but really great rooms experience with a free value added experience and then they’re on their way," Joyce elaborated. "They’re not there to experience the hotel – they are there to enjoy the beach, or go on pilgrimage or doing business and sales calls on their regular route. So that’s what we’re looking to provide is that lodging. The market is slowly developing and there’s clearly an unmet need. With the right product and the right partners which we’ve put together, we think this can actually be a pretty exciting opportunity."
" The active pipeline now is seven signed and committed, a total of 15 where we’ve got control of sites and projects. We're looking at a total pipeline of around 25 to 30 at this point in the region," he enthused. "Which is pretty good considering we just put the relationship together a little over a year ago."
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