HVS EMEA Hospitality Newsletter – Week Ending 11 May 2012

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

Al Habtoor Buys Budapest’s Le Méridien

Al Habtoor Group has acquired Le Méridien Budapest from Hungary-based Central European Estates, a subsidiary of Israeli conglomerate Premium International Holdings. The sale price has not been disclosed but it is rumoured to be in the region of €60 million. The 218-room landmark hotel, at the heart of Hungary’s capital, was built at the beginning of the 20th century and originally known as the Adria Palace. It has become the tenth property in Al Habtoor Group’s portfolio and its first asset in Europe. Starwood Hotels & Resorts will continue to run the hotel.

An Express Sale In Scotland

BDL Management Ltd has purchased the Holiday Inn Express Greenock on Scotland’s Clyde Coast, near Glasgow, from a group of high-net-worth individuals for an undisclosed sum. BDL has managed the recently refurbished 71-room hotel since 2001. The Glasgow-based group also announced this week that it has signed an agreement with Conference Hotels Ltd to manage the 61-room Best Western Moore Place Hotel in the village of Aspley Guise, near the town of Milton Keynes, in central England.

Rotana To Tuck Into Turkey

Rotana has signed an agreement with Rhossos Tourism and Hospitality Ltd which will see the group manage its first hotel in Turkey. The 300-room Rhossos Rotana Resort and Serviced Apartments is due to open in 2014 in the port of Iskenderun in southern Turkey. “Turkey has always been a very important market for Rotana and we aim to manage hotels in key locations within the country, marking our entry with the landmark Rhossos Rotana Iskenderun property. We are proud to have been chosen to manage this new jewel and our team is very excited about the opportunity to be working in Turkey,” said Selim El Zyr, Rotana’s chief executive officer.

City Seasons Coming To Europe

UAE-based conglomerate Bin Ham Group is planning to bring its City Seasons hotel brand to Europe. The group, which currently operates five hotels in Al Ain, Dubai, Abu Dhabi and Oman, is reported to be in the process of acquiring a property in a major German city. The hotel is expected to open later this year after refurbishment.

Come To London For A Bit Of Boutique

There are now less than two weeks to go until the 2012 Boutique Hotel Summit, which takes place on the 21-22 May at Altitude London. If you haven’t already got your ticket click here to book your space. Day one of the conference includes a visit to a local boutique hotel in the morning (The Gore in South Kensington). In the afternoon, Chris Mumford, HVS Executive Search’s president for the EMEA region, will be moderating a panel called The hub of the wheel – general managers, during which a selection of top general managers will speak about the challenges of their role at the heart of the hotel, and how it is evolving. HVS London’s chairman Russell Kett will be moderating the final panel of the event on day two: What's now? What's new? What's next? The boutique hotel of the future. Russell’s panellists include Chris Boulton, chief executive, yoo; Mark Jones, senior director of hotel development EMEA, Worldhotels; Shelley Reiner, senior associate, WAGT; and James Wallman, editor, LS:N Global.

Dubai To Hold A W In Its Palm

Starwood Hotels & Resorts first announced plans to place a W hotel on Dubai’s Palm Jumeirah development in 2006. Slated to open in 2009, the project was put on hold; however, this week the group announced new plans to bring its lifestyle brand to the emirate’s man-made Palm project after signing an agreement with Al Sharq Investment LLC. The W Dubai – The Palm is due to open in 2016 with 283 rooms and suites. “Despite economic and political uncertainty in parts of the region, Starwood continues to see demand for growth of all of our brands across the Middle East and North Africa,” said Starwood’s president and chief executive officer, Frits van Paasschen. Starwood now has a development pipeline of 40 hotels planned to open over the next five years, representing an increase in its portfolio of almost 60%.

Three New Cristals

Cristal Hotels and Resorts is to open three new hotels this summer, including its first hotel outside of the Middle East. The 83-room Cristal Grand Hotel Kadri will be opening its doors in the city of Zahlé in Lebanon, the 93-room Cristal Canyon Hotel will be located in Erbil in Iraq and the 36-room Cristal Itsandra Beach Hotel will have views of the Indian Ocean on the island of Comoros, off the southeast coast of Africa. These new hotels will bring Cristal’s portfolio up to five.

Kempinski’s First Hotel In Kenya

Kempinski has reportedly signed a management agreement with Simba Corporation Ltd for its first hotel in Kenya. Along with the ten-storey, 200-room hotel in Nairobi, which is already under construction, the group also plans to open a luxury tented safari camp at the Olare Orok Conservancy in the Masai Mara. Both properties are expected to open later this year.

Highlights Of Hyatt’s First-Quarter Results

Hyatt Hotels Corporation achieved a net income of US$10 million (US$0.06 per share) during the first quarter of 2012. Adjusted EBITDA increased by almost 15% in the first three months of the year to US$125 million. RevPAR for the group’s owned and leased hotels rose by 8.3% on 2011 and revenue for this segment increased by 9.5%. Hyatt added six hotels to its portfolio in the first quarter of the year. “Over the last year, we increased both development resources and financial capital dedicated to expanding our presence,” said Mark Hoplamzian, Hyatt’s president and chief executive officer. “We look forward to continued progress in 2012 given the dedication of our people, the ongoing cyclical recovery in lodging evidenced by strong occupancy levels, limited new supply growth in the US and increasing preference for our brands among developers, hotel owners and guests. In addition, we are excited about our recently announced organisational re-alignment intended to enhance our effectiveness and support our growth in this decade and beyond,” he added.

A 3% Rise In Revenue For InterContinental Hotels Group

InterContinental Hotels Group (IHG) recorded revenue of US$409 million for the first three months of 2012, an increase of 3% on the first quarter of 2011. Operating profit rose by 5% to US$118 million. The group achieved a global increase in average rate of 3.3% and a 2.1 percentage point rise in occupancy. Revenue for IHG’s hotels in Europe increased by 18% to US$90 million; five hotels (915 rooms) were signed for the region during the first three months of 2012 and eight hotels (968 rooms) opened. “The global economic backdrop, particularly in Europe, is still challenging, but the considerable strengths of our business including our resilient model and strong balance sheet give us confidence that we will continue to drive high quality growth,” commented IHG’s chief executive, Richard Solomons.

Absolute Share Price Performance Over the Past Week – 3-10 May 2012

InterContinental Hotels Group (IHG) – Numis Securities increased IHG's share price target to 1800p from 1650p.

Meliá Hotels International – Although share prices were up by the end of the week, Meliá dipped 0.1% on firm volume during the past week.

NH Hoteles – NH fell in four out of five days last week, a five-day fall of 7.9%

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

Russell Kett, Chairman – HVS London (@russellkett)rkett@hvs.com
Charles Human, CEO – HVS Londonchuman@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, President, EMEA – 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