Interview: Emerald Palace Kempinski's Sebastien Mariette

Managing director Sebastien Mariette has been at the helm of the Emerald Palace Kempinski Dubai and Kempinski Hotel & Residences Palm Jumeirah for (at the time of writing) just 10 months.

In his business plan for the Emerald Palace Kempinski hotel, he calculated that the number of 5-star hotel rooms to open in Palm Jumeirah in 2019 alone is 3,922, readily admitting that competition in the region is strong.

Hotelier Middle East’s pipeline report (January 2019) highlighted that 2019 is expected to remain a “challenging environment for hoteliers for the most part in the MENA”. Data from STR Global points to an expected additional 58,000 keys this year in the GCC, with Dubai facing the highest supply increase.

With such findings, it is not difficult to see why the term “market saturation" is being banded around by some of Dubai’s hoteliers. However, the increasing number of hotel keys and less than favourable forecast (not to mention the ‘down talking’ of the market), has failed to dampen Mariette’s positivity towards the recently opened Emerald Palace Kempinski Dubai and its future performance.

“What we have opened is something completely different; there are not too many palaces like this one in Dubai,” he says. “Even with a lot of supply I’m confident we will get our market share because people will look for such a product.”

Built at a cost of US $700,000,000 million, the 391-room Emerald Palace Kempinski Dubai makes no apologies for its grandness. Reminiscent of Peterhof Palace (Peter's Court), a series of palaces and gardens located in Russia’s Saint Petersburg, commissioned by Peter the Great, the Emerald Palace Kempinski Dubai has also taken its cue from France’s Louis XIV era.

Like Peter the Great, the target market of the Emerald Palace is Russian and countries within the Commonwealth of Independent States (CIS), consisting of ten former Soviet Republics: Armenia, Belarus, Kazakhstan, Kyrgyzstan, Moldova, Russia itself, Tajikistan, Turkmenistan, Ukraine, and Uzbekistan. Mariette also points to the local market. “It’s very important,” he says. “We look to the GCC– the Saudis, the Emiratis. It’s a wealthy target.”

Sat in the property’s Blüthner Hall, where a ‘Taste of Europe High Tea’ and a ‘British High Tea’ is served, Mariette seems at home among the Baroque furniture and the hand-made Blüthner Supréme Edition Louis XIV grand piano. “I think in a market as competitive as Dubai you have to come up with something different.”

The Emerald Palace Kempinski Dubai had its soft launch on November 29, 2018, launching its official opening event on January 16 this year.  The official launch, according to Mariette, was to say that the 391 room-Emerald Palace Kempinski is finally open. “It’s about creating awareness.  We have to tell  [customers] we are open. Please come see us.”

Mariette admits the delivery of the hotel was around three years overdue. “The owner is a perfectionist. Even a month before the official opening, tiles were replaced, to meet the owner’s standards. He likes to take his time,” said Mariette.

The 100,000-m² property is located adjacent to the already established Kempinski Hotel Residences, which opened in September 2011, and which follows a typical residency model. “Some people own a unit and live there; other owners live abroad and use the residence two to three months a year, and some people just book for a night or two a year,” he says. “They have been open years; we have rapid business, with the holiday periods full, and people booking from one year to the next.”

When pressed on whether the success of the Kempinski Residencies was used as a gauge to help in planning the launch of the Kempinski Palace, Mariette replied: “No!” The hotel property and Residencies are positioned and sold as two different identities. “The residences an amazing product; they are not as luxurious and extravagance as the Emerald Palace hotel.”

According to Mariette, the long-term objective of Nver Mkhitaryan – the owner of the Emerald Palace Group Limited (EPG) that includes the Emerald Palace Kempinski Hotel, and Kempinski Residences & Hotel Apartments – is to upgrade the residence to the same standard of the Emerald Palace from a design, architecture and furnishing point of view. “This will take time,” he says.

Opened for a little more than two months, occupancy is still quite low at the Emerald Palace, which Mariette says is expected. “It’s very good on average daily rates (ADR),” he says. “But that is easy as you can have a very good ADR on 1% occupancy. Today we have a good ADR and occupancy is climbing.”

Mariette sees the other hotels on The Palm as friends, rather than just competitors. “We are all colleagues of the hospitality industry, but we have a slightly different product. But in terms of positioning, we want to lead  in quality.”

True to his word, Mariette said in a recent interview with Hotelier’s sister publication Caterer Middle East, that he is not concerned that the soon to open W Dubai will provide competition to his outlets, instead stating that the two will create a “huge F&B destination” for the city.

W Dubai is “catering to a market which is completely different to ours”, he said, speaking to Caterer Middle East, believing that having the two side-by-side on The Palm will “complement each other. “The more noise they make the better it is for this property and vice versa.”

Currently, Emerald Palace Kempinski has 10 F&B concepts, including Mix by Alain Ducasse and Japanese steakhouse Matagi.  “The pricing policy of the F&B venues are comparable to the stand-alone restaurants found in Dubai,” he says. Although the Emerald Palace Group Limited oversees the venues, it gives them a lot of flexibility. “We say to them, please develop your local clientele.”

The F&B target market is aimed at those staying at the resort. “The capture rate is important,” he says.  The second target are The Palm residents, who he says would be looking for a dining destination. “Once we have built a reputation, we will attract more people from Dubai, who will hopefully stay for the weekend.”

Mariette, in terms of the product concept, puts the Emerald Palace on par with that of “The Four Seasons of this world, the One & Only Mirage, Bulgari properties, Jumeirah Al Naseem, and Jumeirah Al Qasr.”

“My objective in the long- or mid-term is to be not only the leading hotel on The Palm, but the top five properties in Dubai, from a quality point of view, a 5-star point of view,” he says.

Today, the property’s communication team is focused on letting people know that “this is the opening of an actual palace in Dubai.” This was borne out by the fact that on an adjacent table a group of 15 people from Riyadh, Saudi Arabia, who had flown in for a site inspection, were visiting the property in order to see the villa products on both sides of the resort.

Mariette describes at length the property’s attention to detail – the choice of furnishings, room products, the quality of the hotel, operating supplies and equipment (OS&E), and outdoor landscaping.  “The owner – who likes to say that he is the only one to open a true European palace in 250 years – has been involved in everything, together with the operator. I’m pretty proud and happy with the result.”

Hotels opening across the region, and throughout the world, often lean towards contemporary interior designs – clean lines, minimalist and stylized furnishings, which is in sharp contrast to the interior and architectural design of the Emerald Palace.

“The owner really likes this style, and the quality is wow.  It is an advantage [from a market point of view], and we are managing a product that is completely different,” Mariette explains. He went on to say how people have an opinion about the design. “This is an advantage, because we are being talked about; the product stands out.”

The hotel service is, according to Mariette, genuine and nonintrusive.  “Every morning I tell the team that it is not the quantity of marble or carpets, or the number of palm trees that will make the difference. It is the quality of service we are implementing in the property right now.”

He is keen to maintain the service, and in doing so, makes sure that he meets all new members of staff, in order to access if they are team players.  “I want to make sure the team spirit is right, and they blend in with the team.”

“We have opened something completely different; there are not too many palaces like this one in Dubai. Even with a lot of supply, I’m confident that we will get our market share because people will look for such a product.”

For Mariette Emerald Palace Group, any talk of a “saturated market” has passed them by. Speaking about the group’s pipeline, he revealed that there are a number of projects in the UAE within its sights. “In a couple of months, we are opening a 277-key hotel in Dubai’s Business Bay.  There are also quite a few projects in Saudi Arabia,” he adds.