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HVS EMEA Hospitality Enews - Week Ending 4 July 2008

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

MA Kharafi Group Anoints Sovereign

MA Kharafi Group, the Kuwaiti conglomerate, has announced the launch of Sovereign Hospitality Holdings, an independent company that will invest in hospitality, tourism and real estate around the world. Sovereign, which has its base in the Swiss city of Geneva, owns and operates a starting portfolio of 21 hotels (more than 4,000 rooms); these are located in Egypt, South Africa, The Gambia, Syria, Lebanon and Albania. Sovereign already has new projects under development in the African nations of Libya, Ethiopia, Mauritania and Senegal (see next item).

Sovereign Visits Senegal

Sovereign Hospitality Holdings has signed a management agreement with InterContinental Hotels Group (IHG) on a 250-room InterContinental hotel in Dakar, the capital of the West African republic of Senegal. Sovereign is to invest more than US$250 million in the 30-hectare mixed-use site in which the hotel will sit. The hotel will be open by 2010. This is the second time in recent months that Sovereign and IHG have met; in May, the pair signed an agreement to open a 370-room InterContinental hotel in the Syrian capital Damascus.

Spain Wins Again In Austria

Work will start this year on the construction of the tallest building in Austria, the 220-metre DC Tower 1. Inside the tower will dwell the ME Vienna hotel, its 255 guest rooms occupying the first 15 floors of the 60-floor building. Partnering Sol Meliá in the project are the Austrian firms Bauträger Austria Immobilien, and WED. Like the ME Barcelona, which is due to open in August, the ME Vienna has been designed by the renowned French architect Dominique Perrault. ME Vienna is the third hotel in Europe to have the ME by Meliá brand, which was launched by Sol Meliá in 2006.

Kempinski Scales New Heights In Dubai

One Za’abeel is a mixed-use development of three towers that is to be built in the emirate of Dubai. One tower will contain 450 residential apartments, another office space, and the third – the one of greatest interest to Kempinski Hotels – will contain a five-star hotel. The One Za’abeel Kempinski Hotel, which will have 370 guest rooms and 133 serviced apartments, is due to open in 2011. Kempinski signed a management agreement on the hotel with the Investment Corporation of Dubai, which is the investment arm of the government of Dubai.

Rezidor: Yas I Can

Rezidor Hotel Group has announced that it is to have a second hotel in the emirate of Abu Dhabi. The 370-room Radisson Yas Island Abu Dhabi, which is to open in the final quarter of 2009, is one of several hotels on the Yas Island development, and it will stand adjacent to the Formula 1 racing circuit. Elsewhere, it is the emirate of Dubai that has been of interest to InterContinental Hotels Group (IHG) this week. IHG has opened the 171-room Holiday Inn Express Dubai-Safa Park, a fruit of its relationship with Ishraq Gulf Real Estate Holding Company. The hotel will be operated by Ishraq Hospitality Management.

Starwood Lets Balaclava Go To Its Head

You could don a balaclava in celebration, but in the climate that the island of Mauritius has to offer it is probably best to dispense with any form of knitwear and make do instead with a paper party hat. Why the party? Well, on 5 July, The Grand Mauritian will be opening in Balaclava, on the northwest coast of Mauritius. The 193-room resort will be managed by The Luxury Collection under an agreement with Blue Ocean Park and is a first hotel on the island for Starwood’s Luxury Collection.

Chernukhin Plans A "Six-Star" Hotel In The City Of London

In 2006 Vladimir Chernukhin paid a reported £72 million for the headquarters of the former Midland Bank on Poultry, in the City of London. At the time, the former Russian deputy finance minister was said to have had plans to convert the Grade I listed building into a luxury hotel. Those plans are now a step nearer to being realised after the City authorities gave their approval for the five-storey building, which covers an acre of land behind the Bank of England, to be converted into a “six-star” hotel of 184 rooms.

One Hotel That Can Expect To Live Long And Prosper

Hotel number 147 in the Scandic chain is to be a hotel in the Norwegian capital Oslo. The 140-room Scandic Vulkan, which is due to open in 2010, is to be built by Vulkan Eiendom at a cost of NKr170 million (€21 million). Construction work on what is Scandic’s fifth new hotel project in Norway inside the last seven months is expected to start this autumn. The Scandic Vulkan will be Scandic’s sixth hotel in Oslo.

Dream Of A Large Marine? This Is For You, Then

The Marine Hotel has 31 rooms and three stars. If property developer McAlister Holdings has its way, then the hotel in Ballycastle, on the north coast of Northern Ireland, will soon have 200 rooms and five stars. McAlister Holdings has submitted plans to redevelop the hotel as the centrepiece of a resort having a spa and conference facilities. The cost of developing what would be the first five-star hotel on the north coast is a reported £30 million.

Kiessling's Corner

Gabriele Kiessling, HVS’s analyst in Madrid, once again has her eyes firmly fixed on the Spanish market. Here is what she has spotted this week. Ayre Hotels, the urban chain of Fiesta Hotels Group, has acquired the nineteenth-century building Palacio de la Marquesa viuda de Aldama, in Madrid, and will convert it into a four-star boutique hotel. The hotel is expected to open at the end of 2010 and it will have 70 rooms. Elsewhere, the Catalan chain Apsis Hotels has continued its expansion by signing a contract to manage a 100-room hotel in Barcelona. The hotel, in which a reported €22 million has been invested, is due to open at the end of this year and it will be Apsis Hotels’ eighth hotel in the city.

Absolute Share Price Performance Over the Past Week 26 June-3 July 2008



InterContinental Hotels Group - At the end of last week Citigroup had a 'Hold' rating and cut its target price from 850p to 780p.

NH Hoteles - Citigroup had a 'Hold' rating and cut its target price from €10.30 to €8.70.

Whitbread - Companies exposed to consumer spending saw their share price suffer.


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