Working with government
With this in mind, how should GMs be working with the tourism boards to assist in the overall destination proposition of the UAE? Al Marri and Al Reyami will be joined by Rotana chief operating officer Omer Kaddouri and Emaar Hotels and Resorts CEO Marc Dardenne to discuss this, and the impact of the legislative landscape on hoteliers, at The Great GM Debate.
The panel will be moderated by industry consultant John Podaras, who recently joined the Hiranandani Group, and will seek to explore the relationship between hotels and various governmental bodies.
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Podaras will address several major issues: whether there is sufficient consultation between the industry and the regulatory bodies; whether governments should control the number of hotel licences issued; the responsibility of governments and hotels to protect guests’ safety and wellbeing; who classifications are designed to benefit; and how attractions are being developed in line with cultural sensitivities.
“Another question that concerns the industry is the fees and levies in terms of charges (service charges), taxes (tax on alcohol) and the fees (annual licence fees),” said Podaras. “Are these, and indeed, should these be uniform, or should there be differences between emirates and in some cases between free zones and the city? What are these funds (service charge and licence fees) used for and is it value for money?”
Kaddouri agreed that governmental bodies have great influence through areas such as ease of visa requirements, moderate tax rates, the development of tourism infrastructure and open skies policies.
“These areas are important for us as hoteliers and are areas where we can work closely with the government on enhancing the overall business environment,” said Kaddouri.
Where are we headed
There are many more factors that will contribute to improving the overall business environment Kaddouri alludes to. The UAE has by the far the largest number of hotels in the development pipeline in the Middle East — at the last count, there were 55,165 hotel rooms in the total active pipeline, with more than half under construction. (STR Global). With hotels still adjusting to the economic downturn and only gradually seeing growth, how daunting is this pipeline? How will established hotels keep up, and on the other hand, how will new hotels make their mark?
Preparing to discuss these issues, and much more, at The Great GM Debate, are industry leaders Bani Haddad, vice president development – Middle East and Africa, Wyndham Hotel Group; Daniel Hajjar, chief executive, Layia Hospitality; Michael Weyland, general manager, hotel division, Landmark Group; Christophe Landais, managing director, Accor Hospitality; Darroch Crawford, managing director, Premier Inn; Oliver Key, general manager, Armani Hotel; and Mike Scully, managing director, Seven Tides Hospitality.
The panel will be moderated by Ròya International chief operating officer Gerhard Hardick, who will address the “new reality” of the UAE hotel market. Hardick said he expected that the luxury market will continue “to flourish largely irrespective of economic situations now or in the future”, but said that existing hotels would need to up their game.
“There is no established evidence that established hotels are actually keeping up with new entrants,” said Hardick. “The evidence so far seems to be that established hotels are just doing a bit more of what they have been doing for a long time, without too much success. What is needed is a total rethink of the modus operandi of their establishment.”
In a similar way, the “famous Dubai service standards will have to be re-thought” asserted Hardick — not by scaling them back but by placing the emphasis on hiring, training and “adequately remunerating” more focused employees.
Mike Scully said growth in the future depended on two things: making the product attractive and fun, and driving business by pricing the product attractively.
“Make sure that your management company has got the management to drive business to your properties, and if they can’t, help them and help them to employ the people that will help them,” he advised.
“It doesn’t matter if you’re old or new. There are many new properties whose management isn’t geared to the market and could take a lot longer to make a mark, whereas some older properties could find it easier on the basis that they have loyalty they could enhance.”
Representing the newer properties, at the top end of the scale and the budget end, are Oliver Key and Darroch Crawford, who took a similar stance to Scully.
“From an operational point of view, what is extremely important, is that there is no more room for complacency,” said Key. “The hotel market in this part of the world is extremely competitive now; not only do we have more international players but also home-grown brands are branching out into global markets. This means hotels here have people with the right skill-sets to make them internationally competitive.
“As in all developed markets, the UAE hotel segment is led by two key determinants — quality and price, the key is to offer guests value for money and superior quality in terms of product and service,” Key said.
He added that it was vital to remember the importance of that old adage; location, location, location.
“Another key determinant in the success of a particular property is the location, some locations have established themselves only recently, for example Downtown and the Burj Khalifa in Dubai, The Palm Islands and others,” said Key.
“Now more than ever, an increased emphasis is being placed on a property’s location depending on the particular guest’s requirements. For the next few years, there are likely to be some locations that will struggle more than others to remain competitive,” he asserted.
With so much change underway, and more on the horizon, Crawford said The Great GM Debate couldn’t have come at a better time, as now more than ever the onus was on hoteliers to work together to build their destinations.
“The dynamics of the hospitality business in the region have changed beyond recognition in a very short space of time and it is our responsibility as the current guardians of the industry to shape and protect its future. I also believe that we have an opportunity to work together to build a unique offering that will set us apart from the rest of the world,” said Crawford.
“My hope for The Great GM Debate is that it will be the start of a new more aligned approach to tackling the challenges and opportunities that we face.”
If you are interested in supporting The Great GM Debate, please contact diarmuid.omalley@itp.com or sarah.worth@itp.com for sponsorship opportunities.
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