HVS EMEA Hospitality Newsletter – Week Ending 13 January 2012

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

Qatar Wins Two Raffles

State-owned hotel owner and developer Qatar National Hotels Company (QNH) has recently become the owner of two flagship Raffles hotels: the 103-suite Raffles Hotel Singapore, which opened in 1887, and the 149-room Le Royal Monceau – Raffles Paris, which reopened in 2010 after an extensive two-year renovation. Commenting on the new acquisitions, Hamad Abdulla Al Mulla, QNH’s chief executive officer, said, “Adding these iconic properties to our portfolio represents consistent steps of QNH’s strategic expansion at the international level.” QNH’s asset portfolio now contains 11 properties across the Middle East and Africa (nine), Asia (one) and Europe (one).

Principal Hayley Buys Back Six Hotels

Northern England-based hotel group Principal Hayley Hotels and Conference Venues has invested £200 million in repurchasing six hotels in the UK from fund manager AAIM. Principal Hayley originally sold the portfolio to AAIM in 2006 for around £275 million. The hotels include the 373-room Hotel Russell in London and the 275 room Palace Hotel in Manchester. Principal Hayley has now sold the freehold of the six properties to Pramerica Real Estate Investors, but it will continue to operate the hotels under 175-year leases.

The Road To Home For Ynyshir Hall

A former von Essen hotel has been bought back by its original owners. Joan and Rob Reen sold Ynyshir Hall in the village of Eglwys Fach, Wales, to von Essen Hotels in 2006. The purchase price was undisclosed but the nine-room hotel was on the market for £1.5 million. The Reens originally opened the hotel in 1989. The historic building was once owned by Queen Victoria and was used as a hunting lodge – it is one of the oldest hotels in the former von Essen portfolio. During its tenure with von Essen, Joan Reen stayed on at the hotel as general manager. “It is wonderful to have back control of the hotel and we are looking forward to moving ahead immediately with some major maintenance work,” said Joan.

Leonardo Coming To Austria

Israeli chain Leonardo Hotels has signed a long-term lease agreement with property investor IMMOFINANZ Group for its first hotel in Austria. A €6 million renovation is to start this month on one of IMMOFINANZ’s existing hotels in Vienna, and it is expected to reopen in July as the 213-room Superior Leonardo Hotel Vienna. The deal brings Leonardo’s presence in Europe to 31 hotels in 19 cities across five countries.

Staywell In Birmingham

Australian company Staywell Hospitality Group and its investment arm Seven Capital has lodged planning permission this week to convert a derelict office building in the city of Birmingham, UK, into a 300-room Park Regis hotel. This would be the group’s first property outside of Australasia, the Pacific and Asia. The 12-storey Auchinleck House building, above the Five Ways shopping centre, was built in 1962 and it has lain empty for several years. Staywell plans to invest £100 million in the project, which will also include the construction of a conference centre to the rear of the hotel and a refurbishment of the shopping centre; planning permission for this part of the scheme is to be submitted within the next two months. If its plans are approved, Staywell hopes to start construction work later this year with an opening planned for 2014. “This is an important development for us. The group needs to put a flag in the ground in Europe. It is a prestigious development which will support further expansion in the UK and Europe.” Said Andy Robinson, development director for Seven Capital.

Ibis Budget Lands In France

The 83-room ibis budget Grenoble Sud Seyssins opened near the city of Grenoble this week as the first of its brand in France. Accor also opened its second ibis property in Equatorial Guinea, West Africa: the 120-room ibis Bata, which is located in the port of Bata, on the Atlantic Ocean.

Hotel Number Eight For Foremost Hospitality

In June 2012, construction is due to start on Berlin-based hotel owner and operator Foremost Hospitality’s eighth hotel. Work on the Holiday Inn Express Heidelberg City Centre, in Heidelberg, southwest Germany, is expected to be completed in spring 2014. The 152-room hotel will be housed in a building that will also contain retail and office space. Foremost currently owns and runs seven hotels across Germany.

Three Hiltons Become Four In Riyadh

Hilton Worldwide has signed a management agreement with Obeikan Real Estate Development Company for its fourth Hilton Hotels & Resorts property in Saudi Arabia’s capital, Riyadh. Construction of the new-build Hilton Riyadh King Fahd Road has already started, and the 210-room hotel is scheduled to open in 2014. Hilton’s other three hotels in the city are all due to open by the end of the year. Commenting on the newest addition to the portfolio, Rudi Jagersbacher, Hilton’s area president for the Middle East and Africa, said, “While our existing pipeline covers East and West Riyadh, this partnership with Obeikan Real Estate Investment Company will give us a presence in the prestigious downtown district of the capital.” Overall, Hilton Worldwide currently operates six hotels in Saudi Arabia, with 14 planned/in development.

Chief Executive Role Swap

MWB Group Holding has announced that Gary Davis has been appointed as chief executive for its Malmaison and Hotel du Vin brands. His predecessor, Robert Cook, who held the role for eight years before he announced his departure from the group last October, is to take on Mr Davis’ old role of chief executive of Village Hotels at De Vere Group; additionally, he will join De Vere’s executive board. “Robert Cook has helped to create both a dynamic brand and a great team…It is a privilege to take over his mantle, cast a fresh eye over the brands and take the business on to the next stage of its development,” said Mr Davis. These aren’t the only changes afoot this week, however, as De Vere’s current executive chairman, Andrew Coppel, is to become group chief executive, with the role of chairman passing to Nicholas Bull.

Absolute Share Price Performance Over the Past Week – 5-12 January 2012

InterContinental Hotels Group (IHG) – Deutsche Bank raised IHG to "buy" from "hold".

Accor – Deutsche Bank cut Accor's share price target to €33.

Millennium & Copthorne – Millennium & Copthorne dipped 0.3% on high volume.

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 – HVS London (@russellkett)rkett@hvs.com
Charles Human, Managing Director – HVS Hodges Ward Elliottchuman@hvshwe.com
Tim Smith, Director – HVS Londontsmith@hvs.com
Chris Martin, Director – HVS Hodges Ward Elliottcmartin@hvshwe.com
Demetris Spanos, Managing Director – HVS Athensdspanos@hvs.com
Hala Matar Choufany, Managing Director – HVS Dubaihchoufany@hvs.com
Christopher Mumford, Managing Director – HVS Executive Search (@ChrisMumford)cmumford@hvs.com
Philip Bacon, Managing Director – HVS Madrid and Managing Director, EMEA & Asia – HVS Shared Ownership Servicespbacon@hvs.com
Saurabh Chawla, Director – HVS Asset Management and Strategic Advisoryschawla@hvs.com
Louise Fury, Senior Editor and EMEA Hospitality Newsletter Author – HVS Londonlfury@hvs.com