HVS Hospitality Newsletter – Week Ending 16 August 2013

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

Britannia Buys In Bournemouth And Other UK Transactions

Privately owned UK chain Britannia Hotels has acquired the Carrington House Hotel in the seaside town of Bournemouth, on England’s south coast, from Akkeron Hotels. The 145-room hotel was on the market for offers of more than £3 million. The sale brings Britannia’s portfolio up to 45 properties, and the Carrington has become its fifth hotel in Bournemouth. Akkeron reported that it made the decision to sell the hotel, which was part of its Forestdale Hotels portoflio, as it no longer fitted in with its future strategy. Additionally, Akkeron recently sold the 87-room Rutland Square Hotel in Nottingham, north central England, to Marsh Management for around £2 million. Marsh now plans to invest in the three-star hotel and reposition it as a four-star property. Rutland Square was also part of Akkeron’s Forestdale portfolio (a set of 18 hotels the group purchased from Forestdale Hotels in 2010). Other UK transactions included the sale of the Hotel on the Park in the town of Cheltenham to Dunkerton Properties, which is owned by Julian Dunkerton, founder of fashion brand Superdry. The 11-room hotel fell into administration in June 2013 and was on the market for a guide price of £2.6 million. The hotel is currently closed for refurbishment.

Radisson Blu Turns Up In Tuzla

Carlson Rezidor Hotel Group announced a new hotel for Istanbul, Turkey, this week. Its seventh hotel in the city is currently being constructed in the seafront suburb of Tuzla, on the eastern outskirts of Istanbul’s Asian side. The 249-room Radisson Blu Conference & Spa Hotel, Istanbul Tuzla is expected to be ready to throw open its doors to its first guests by the end of the year.

Buffed-Up Barkston Becomes A Hotel Indigo

One of London’s oldest hotels has been given a makeover and a new identity. Cairn Hotel Group has invested £7 million in the Barkston Gardens Hotel, which dates from 1886, in the city’s Earl’s Court area, and the hotel was recently relaunched as the 100-room Hotel Indigo London Kensington. Newcastle-based Cairn has reportedly owned the hotel for more than 20 years.

Generator Expands To Paris and Rome

Just three months after it made its debut in Spain, Generator Hostels is rolling its way rapidly through Europe with the announcement of new properties for Paris and Rome. First will come Generator Rome in spring 2014, Generator’s second Italian hostel. This seven-storey, 80-room hostel, in a converted 1900s residential building, will be able to accommodate up to 264 travellers in Italy’s ‘Eternal City’. Generator Paris is due to open in the French capital’s tenth arrondissement near the end of 2014. It will become the group’s largest hostel, catering for up to 950 guests, and its first in France. Generator now operates eight properties across seven European cities. Backed by private equity group Patron Capital, Generator plans to have a presence in 15 locations by 2015, including further expansion in Europe and a foothold in the USA.

Have You Seen The Hotel Bulletin?

HVS, AM:PM and Zolfo Cooper have released their hotel bulletin for the second quarter of 2013. Focusing on the UK market, it shows occupancy, average room rate and RevPAR trends for the main UK cities, plus the year-on-year change in supply. The bulletin highlights the demand and supply dynamics, the UK pipeline and notable hotel transactions for the quarter. HVS director Tim Smith commented that, “The performance improvement comes as a welcome relief for hotels in the regions. We need this to continue for a few months to have an impact on both the top and bottom lines, and more importantly increase confidence for both operators and investors. Only then will the recovery be truly underway.” Additionally, our city focus is Liverpool, where recent hotel performance has been impressive, despite supply having almost doubled in size over the last decade. To read the bulletin in full click here.

Travelodge Opens Cambridge Hotel And Plans Property For Greenwich

Travelodge has opened its sixth hotel in Cambridge, in east England, and its largest asset in the city to-date. The five-storey, 604-room Cambridge Newmarket Road Travelodge, which is owned by Charities Property Fund, was developed on the site of the former Greene King Brewery for £18 million. The budget brand has invested almost £40 million in Cambridge since it opened its first hotel in the university city in 1988. Travelodge also plans to open a hotel in Greenwich, southeast London. The 104-room hotel is to open in September 2014 as part a mixed-use development called The Movement. Construction is due to start on the hotel this September.

Sold Once, Not Twice

Further to our report last week that the Holiday Inn London Stratford City and the Staybridge Suites Stratford City had recently been sold to M&L Hospitality by an unknown investor that purchased the properties last January, it has come to light that M&L actually was the incognito investor that purchased the properties at the beginning of the year. Thus, the hotels have only transacted once in 2013.

St. Regis Lives The High Life In Abu Dhabi

Starwood Hotels & Resorts has opened its second St. Regis hotel in Abu Dhabi, UAE. The 283-room St. Regis Abu Dhabi is part of the Nation Towers mixed-use development, comprising two high-rise towers of 65 and 52 storeys, on Abu Dhabi’s Corniche. The hotel is housed over floors 33-49 of the smaller tower – if you have a good head for heights you can cross the Sky Bridge, which, connecting the two buildings at floors 50 and 54 (at 202.5 metres high), is the highest interconnecting bridge in the world. The hotel joins its sister property, the 337-room St. Regis Saadiyat Island Resort. Abu Dhabi is so far the only emirate in the UAE to have a St. Regis, but this will change in July 2016 when the St. Regis Dubai opens with 241 rooms.

Best Western Opens In Mecca

Best Western International has opened its second hotel in Saudi Arabia, making its first appearance in the city of Mecca. The 152-room Best Western Plus Bakkah Awan Hotel is nestled at the heart of the city, minutes from the Holy Mosque. “The city receives more than three million pilgrims during the Hajj and around six million for the Umrah, and Best Western is delighted to be able to cater for these visitors with a modern, upscale accommodation choice,” said Glenn de Souza, Best Western’s vice president of international operations in Asia and the Middle East. Best Western currently has nine hotels across the Middle East but has a burgeoning pipeline for the region and plans to expand its portfolio to 22 hotels (at least 3,600 rooms) in eight Middle Eastern countries by 2015.

A New Ramee Hotel For Bahrain And Mercure Number Seven For Saudi Arabia

Ramee Group has officially opened its first five-star hotel in Bahrain, in Manama, and its 14th property in the country overall. A total of US$53 million was invested in the 166-room Ramee Grand Hotel and Spa. The 24-storey hotel towers over the coastline in the city’s Seef district. Accor recently opened the Mercure Jeddah Al Hamra in Saudi Arabia. This 149-room hotel is Accor’s seventh Mercure property in the country, bringing its room count in Saudi Arabia up to 1,216.

Absolute Share Price Performance Over the Past Week – 8-15 August 2013

Accor – Bank of America-Merrill Lynch upgraded Accor to "buy" from "underperform" and increased its target price from €23 to €34.

NH Hoteles – NH lifted 2.5% on high volume.

Rezidor Hotel Group – Rezidor dropped 2.8% on weak 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, Chairman – HVS London (@russellkett)rkett@hvs.com
Charles Human, CEO – HVS London/HVS Hodges Ward Elliottchuman@hvshwe.com
Chris Martin, Director – HVS Hodges Ward Elliottcmartin@hvshwe.com
Tim Smith, Director – HVS Londontsmith@hvs.com
Arlett Oehmichen, Director – HVS Londonaoehmichen@hvs.com
Sophie Perret, Director – HVS Londonsperret@hvs.com
Demetris Spanos, Managing Director – HVS Athensdspanos@hvs.com
Hala Matar Choufany, Managing Director – HVS Dubaihchoufany@hvs.com
Louise Fury, Senior Editor and EMEA Hospitality Newsletter Author – HVS Londonlfury@hvs.com