HVS EMEA Hospitality Enews - Week Ending 2 May 2008

The latest hospitality news from Europe, the Middle East and Africa

Fairmont Has The Time…

The Makkah Clock Royal Tower, A Fairmont Hotel is to be the name on one of the world’s tallest towers when the hotel opens this autumn. Fairmont Hotels & Resorts’ first hotel in Saudi Arabia will commit its 1,005 guest rooms to a tower 76 storeys (577 metres) high. The tower is one of seven being built by Saudi Binladin Company at the Abraj Al Bait complex in the city of Mecca (Makkah). Guests who forget to set their bedside alarm need not fear oversleeping; one of the other towers will house The Makkah Clock. Imagine how big the bell might be in a clock tower more than five times the size of Big Ben.

…And Emaar Has The Address

The Address is the name to be worn by world-class five-star hotels and resorts, and it will be seen for the first time later this year at flagship hotels in Burj Dubai and Dubai Marina, in the emirate of Dubai. Hotels with the brand will be operated by Emaar Hospitality Group (EHG) and will be present in all countries where EHG’s parent Emaar Properties is currently represented.

Rocco Forte To Gorge On Jeddah

It is scarce three months since The Rocco Forte Collection (RFC) was last in the Middle East. That inaugural visit was to Abu Dhabi; for its second trip, RFC has headed for the Red Sea coast of Saudi Arabia. There to welcome them to the city of Jeddah were Sheikh Mohamed Al Issa and his sons; they own the 19-storey hotel that RFC will be managing from 2010. The hotel will have 159 guest rooms and around 50 serviced apartments.

Sun Days Off To The Dead Sea With IHG

Sun Days International for Tourism Investment has invited InterContinental Hotels Group (IHG) to help it develop a US$70 million luxurious resort on the shores of the Dead Sea in Jordan. The InterContinental Resort Dead Sea, which is set to open in late 2012, will include a 236-room hotel, a selection of chalets and a private beach.

The Potential Sale of Norgani Hotels Is Arranged

Norwegian Property and Oslo Properties have signed a letter of intent with a group that wishes to purchase Norgani Hotels. The group, which of necessity must remain anonymous until any share purchase agreement is signed, have offered NKr11.2 billion (€1.4 billion) for Norgani, which is the fifth-largest hotel property investor in Europe; it has a portfolio of 74 hotels in the Nordic region. The potential buyers have been granted exclusivity until the middle of May. Norwegian Property expects any deal to be completed by the middle of June.

Rezidor Unleashed In The Parks

It would be mildly disappointing were a park named Gagarin not to have the space: space, that is, for Rezidor Hotel Group’s twentieth hotel in Russia. The 188-room Radisson Hotel Chelyabinsk is set for launch in the first quarter of 2010 in the southwestern city of Chelyabinsk. Another park – Seaside Park – occupies the thoughts of Rezidor in the republic of Georgia. The 150-room Radisson Hotel Batumi, Georgia will open adjacent to that park, in the port of Batumi, in the second quarter of 2010.

Interval Affiliates Barceló Club Puerto Castillo

Interval International has tempted the Spanish chain Barceló Hotels & Resorts into taking its first step into the world of vacation ownership. Interval, which is a leading provider of vacation services, has affiliated the 31-unit Barceló Club Puerto Castillo on the island of Fuerteventura in the Canaries.

Innovation From IHG. Everyone's Green

Earth might gently toast thanks to global warming, but at least InterContinental Hotels Group (IHG) will not provoke yet more steam to rise from the coroner as it enters the dock at the great celestial inquest. For IHG will remind the jury of the initiative it undertook in 2008 when it launched what was thought at the time to have been the late planet’s first 100% ecofriendly hotel. Innovation Hotel could be standard across all of IHG’s brands in the next few years. Among the features are solar panels, recycled furniture and roof gardens rich in shrubbery.

Whitbread Rolling In It

Revenue of £1.2 billion and a pre-tax profit before exceptionals of £210.3 million: the headline figures from Whitbread’s results for the year to 28 February 2008. Those amounts are improvements of, respectively, 11.3% and 26.3% on the previous year’s figures. The Premier Inn chain of budget hotels had a good year too, a record year, indeed, opening 3,400 rooms and seeing its sales rise by 15.1%, to £527.8 million. Small wonder, then, that chief executive Alan Parker should say: “2007/8 was a year of excellent progress”.

Full-Year Results From The Real Hotel Company

The Real Hotel Company (RHC) saw its post-tax loss widen in the year to 31 December 2007, to £8.3 million from the £7.9 million of 2006. RHC noted that “the economic uncertainties that arose in the second half of last year have had a negative effect on our business.” Revenue did though rise, by 1.7%, to finish on £81.2 million.

Absolute Share Price Performance Over the Past Week 24 April-1 May 2008

Whitbread - Numis Securities placed an 'Add' rating and raised its target price from 1,369p to 1,408p. Lehman Brothers had an 'Equal-weight' rating and raised its target price from 1,380p to 1,400p.

InterContinental Hotels Group - Towards the end of last week Credit Suisse reiterated its 'Neutral' rating and cut its target price from 1,150p to 910p.

Accor - UBS kept a 'Neutral' rating and cut its target price from €58.50 to €55.50.

For the latest in the hospitality industry, please visit: http://www.hvs.com. You are also welcome to contact the following personnel.

Russell Kett, Managing Director rkett@hvs.com
Charles Human, Managing Director – HVS HWE chuman@hvshwe.com
Hadrien Pujol, Director hpujol@hvs.com
Demetris Spanos, Managing Director – HVS Athens dspanos@hvs.com
Hala Matar Choufany, Director – HVS Dubai hchoufany@hvs.com
Christopher Mumford, Managing Director – Executive Search cmumford@hvs.com
Philip Bacon, Managing Director – HVS Madrid and Managing Director, EMEA & Asia – HVS Shared Ownership Services pbacon@hvs.com
Adrian Jones, EMEA Hospitality Enews Author ajones@hvs.com