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INTERNAL UNIT „DO NOT DISTURB“ / „MAKE UP ROOM“
WETHER YOU WANT TO IMPROVE CUSTOMER COMFORT OR MAKE WORK AND MANAGEMENT EASIER FOR HOTEL OPERATORS, LEGRAND HAS SOLUTIONS FOR GUEST ROOM.
SCENARIO CONTROLLER - ARTEOR
MULTI STANDARD SOCKET - ARTEOR
BEAUTIFY
NEUTRAL WHITE
NEUTRAL PEARL ALU
NEUTRAL GRAPHITE
TATTOO
BEDSIDE UNIT
MIRROR BLACK
MIRROR WHITE
MIRROR TAUPE
MIRROR RED
AUDIO/VIDEO SOCKETS
GRAPHIC FORMAL
GRAPHIC CASUAL
BRUSHED METAL STAINLESS STEEL
BRUSHED METAL GOLD BRASS
WOOD WENGE
WOOD LIGHT OAK
LEATHER CLUB
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RJ 45 SOCKET- ARTEOR
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COMBINE GUEST COMFORT AND OPERATING EFFICIENCY
INTERNAL UNIT „DO NOT DISTURB“ / „MAKE UP ROOM“
WETHER YOU WANT TO IMPROVE CUSTOMER COMFORT OR MAKE WORK AND MANAGEMENT EASIER FOR HOTEL OPERATORS, LEGRAND HAS SOLUTIONS FOR GUEST ROOM.
SCENARIO CONTROLLER - ARTEOR
MULTI STANDARD SOCKET - ARTEOR
BEAUTIFY
NEUTRAL WHITE
NEUTRAL PEARL ALU
NEUTRAL GRAPHITE
TATTOO
BEDSIDE UNIT
MIRROR BLACK
MIRROR WHITE
MIRROR TAUPE
MIRROR RED
AUDIO/VIDEO SOCKETS
GRAPHIC FORMAL
GRAPHIC CASUAL
BRUSHED METAL STAINLESS STEEL
BRUSHED METAL GOLD BRASS
WOOD WENGE
WOOD LIGHT OAK
LEATHER CLUB
LEATHER GALUCHAT
RJ 45 SOCKET- ARTEOR
DISPLAY THERMOSTAT - ARTEOR
SIGNATURE WOVEN METAL
WWW.LEGRAND.AE
Revive Collection taipingcarpets.com/1956
Revive Collection taipingcarpets.com/1956
ISSUE Nº PUBLISHER Dominic De Sousa GROUP CEO Nadeem hood GROUP COO Georgina O’Hara
30 OCTOBER 2014
EDITORIAL GROUP DIRECTOR OF EDITORIAL Paul Godfrey paul.godfrey@cpimediagroup.com D: +971 04 440 9105
IN ASSOCIATION WITH
DIRECTOR OF STRATEGY, EDITORIAL Dave Reeder dave.reeder@cpimediagroup.com M: +971 (0) 55 105 3773 GROUP MANAGING EDITOR EDITOR, HBME Melanie Mingas melanie.mingas@cpimediagroup.com D: +971 04 440 9152 ASSISTANT EDITOR Sophie McCarrick sophie.mccarrick@cpimediagroup.com D: +971 04 440 9150 SENIOR GRAPHIC DESIGNER Chris Howlett PHOTOGRAPHY Anas Cherur & Jay Colina ADVERTISING GROUP SALES DIRECTOR Carol Owen carol.owen@cpimediagroup.com M: +971 (0) 55 880 3817 DIRECTOR OF SALES, BUSINESS DIVISION Sarah Motwali sarah.motwali@cpimediagroup.com D: +971 04 440 9113 M: +971 (0) 50 678 6182 SALES MANAGER HBME Julie Caulton Email: Julie.Caulton@cpimediagroup.com D: +971 04 440 9112 M: +971 (0) 56 778 9793 PRODUCTION MANAGER James Tharian WEB DEVELOPER Louie Alma DISTRIBUTION MANAGER Rajeesh Nair PRINTED BY Printwell Printing Press LLC, Dubai, UAE PUBLISHED BY
Head Office, PO Box 13700, Dubai, UAE D: +971 4 440 9100 Group Office, Dubai Media City Building 4, Office G08, Dubai, UAE A publication licensed by IMPZ © Copyright 2014 CPI. All rights reserved.
6
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EDITORIAL
NEW DIRECTIONS
O
ctober 2014 marks another turning point in the evolution of Hospitality Business Middle East magazine. Over the course of the last two and a half years, we have written about the business of hotel operations; covering the industry’s biggest trends and stories at a time when the regional hospitality industry was growing exponentially. Today, the hotel pipeline almost outnumbers the GCC’s existing properties; Dubai is confirmed to host Expo2020; there are numerous theme park developments confirmed and under construction; airports are getting bigger and busier and cruise, MICE, medical, leisure and corporate travel are all on the rise. With this in mind, we are expanding the editorial scope of Hospitality Business Middle East to include more analysis of the factors driving hotel performance; from destination development to global political, social and economic trends. In addition we have refreshed the visual identity of the printed magazine, to reflect the changing industry it covers. The new HBME will still contain all the same industry analysis and data, as well as news of the latest industry products and services, simply with a wider focus. Supporting the magazine, we also have an exciting events calendar confirmed for Q4. In addition, we are delighted to welcome Majid Al Marri, director hotels classification, DTCM, to lead our editorial advisory board and enhance the public and private partnerships that will drive this new phase of growth. On behalf of the entire HBME team here at CPI Media Group I am delighted to share this news with you and we look forward to receiving your feedback on these exciting developments.
MELANIE MINGAS EDITOR, HBME
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7
CONTENTS
P36
INTRODUCTION P07 Ź INTRODUCTION Ź P07 EDITOR’S LETTER EDITOR’S LETTER P10 Ź Ź EDITORIAL BOARD P10 EDITORIAL Special announcement BOARDon HBME’s newly Special announcement on HBME’s newly appointed head of the Editorial Board appointed head of the Editorial Board
DATA P12 Ź DATA Ź P12 GLOBAL DATA Snapshot ofDATA GLOBAL last month’s hotel performance Snapshot of last month’s and pipelines from aroundhotel the world, with performance andonpipelines around the a special report recoveryfrom in Egypt world, with a special report on recovery in Egypt
PROCUREMENT P20 Ź SUPPLIER NEWS The latest product and service news
P20 Ź SUPPLIER SPOTLIGHT
P66
8
The Leather Doctor explains how to use its restoration services to save on FF&E and maximise refurbishment cycles
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CONTENTS
P26 Ź 4 CORNERS INTERN DIARY Hebah Al Blooshi’s first of six accounts of greening the UAE’s F&B supply chain
DESIGN & TECHNOLOGY P28 Ź BATHROOM INNOVATIONS The latest products from Delta Faucet
P32 Ź THE LEGRAND SEMINAR
P49
P58
DEVELOPMENT & INVESTMENT P36 Ź TAKING FLIGHT The region’s aviation developments and how DWC could shift the hotel hotspots
P42 Ź COVER STORY Abdullah Bin Sulayem on Seven Tides’ next wave of activity
OPERATIONS P49 Ź OCEAN VIEWS GM Otto Kurzendorfer on the touches that make JA Ocean View popular
P52 Ź ROYAL BLOOD
P52
Gianni Malerba on instilling a regal DNA at Royal Rose Abu Dhabi
P54 Ź SEARCHING FOR STARS
P66 Ź NEW KID ON THE BLOCK
The lowdown on Starwood’s new loyalty programme for travel professionals
How much of a threat is AirBnB to hotels?
P58 Ź PROMISING PIPELINES An update on the Fairmonth Raffles Hotels and Resorts pipeline
ANALYSIS P64 Ź ASCENDING VACANCIES Why the gulf is an employer’s market currently
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P70 Ź FOOD APLENTY How does one caterer feed 60,000 people?
TREND TALK P74 Ź Commentary including Colliers International on branding residences; Glion student Harald Buerkle on working through an MBA; and Clyde and Co’s introduction to Iran.
P70
9
EDITORIAL BOARD
CPI chair and founder Dominic De Sousa and DTCM director of hotels classification, Majid Al Marri, at the world’s tallest hotel, JW Marriott Marquis Dubai.
10
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EDITORIAL BOARD
A WELCOME NOTE FROM MAJID AL MARRI DTCM DIRECTOR OF HOTEL CLASSIFICATION MAJID AL MARRI WILL HEAD THE ALL NEW HBME EDITORIAL ADVISORY BOARD TO DRIVE PUBLIC PRIVATE PARTNERSHIPS ACROSS THE HOSPITALITY SECTOR. HE TELLS MELANIE MINGAS WHAT THIS MEANS FOR THE FUTURE OF HOSPITALITY IN DUBAI
D
ubai is a city that makes headlines on a global scale and on a regular basis. Building on its achievements to date, the emirate’s leaders are now poised to execute its next phase and the plans released to date have been phenomenally ambitious. In achieving that ambition – one largely pegged on the hospitality sector, as regulated and licenced by DTCM – one message will stand out above all others. Speaking exclusively to HBME about his new role as head of the magazine’s editorial advisory board – in addition to his continued roles at DTCM and Za’abeel Palace Hospitality – Majid Al Marri reveals the key to Dubai’s next wave of success will lie in strengthening partnerships between the public and private sector, the UAE’s other emirates, key GCC cities, and the leadership and media. Ushering in an age of collaboration, Al Marri says: “We have to work hand in hand to become and to remain on the top 10 list of global destinations. “This is about my passion for the hospitality industry. I want to create a stronger and more transparent relationship with the key stakeholders in Dubai’s growth, to show the world what we have.” “Hospitality is everywhere: at home, in the airport, in the hotels and restaurants. This is our culture and this is a unique brand of hospitality intrinsic to Dubai. We have to take that message everywhere.”
ROADMAP FOR SUCCESS Dubai already enjoys robust demand from leisure and corporate visitors, but will need to expand its focus in order to reach the visitor targets set. In achieving the vision of His Highness Mohammed bin Rashid Al Maktoum, Al
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MAJID AL MARRI’S MISSION t I ncrease collaboration between the public and private sector, other emirates and other GCC countries t C ultivate transparency through closer collaboration with HBME and the wider media t B ring together key industry players through the HBME editorial council t C reate a professional association exclusively for hoteliers t B oost visitor numbers by creating more family friendly attractions and facilities t D rive medial tourism by attracting well-known doctors to work in the emirate temporarily
Marri will continue to lead teams across DTCM and Za’abeel Palace Hospitality with two primary aims: to increase the number of families visiting the emirate and nurture more airline partnerships, following the success of the recent Emirates and Qantas alliance. Broadening the scope, Al Marri will also use his extensive experience of regulations, licensing and international travel, as well as an education at London Business School, to boost Dubai’s profile on the global stage. “Looking at what Dubai has achieved already, the world knows that when we announce something we are promising it and it will happen. “We know from the numbers that the visitor arrivals will continue to increase, the number of projects and hotels will increase. Everywhere we are putting hands together to show that we are reaching our
goal,” he adds, echoing that hospitality isn’t just his job but a lifelong passion. He continues: “As an Emirati I want all the best things to be in my home and I also want for all the other Emiratis, the residents and visitors, I want to bring those things here for them.” Working directly with HBME, Al Marri will use his industry contacts to bring together an advisory board of the key personalities from Dubai’s hospitality industry, to share their observations on the progress of the industry and its most influential trends. This will be further expanded with a series of professional associations, dedicated to putting hoteliers face to face with each other. He elaborates: “This strategic partnership will allow us to bridge the gap between the public and private sector and will give strength to the industry and that’s what I am aiming to give back to Dubai.”
11
DATA
EGYPT: HOTEL MARKET OVERVIEW SINCE THE ARAB SPRING IN 2011, EGYPT’S ONCE BUOYANT TOURISM MARKET SAW OCCUPANCY RATES AS LOW AS 5% IN LUXOR. COLLIERS INTERNATIONAL REPORTS ON THE GROWING MARKET TRACTION
I
n 2013, approximately 54 million overnight stays were recorded by Egyptian hotels, an increase of 1.6% from 2012. The positive performance is attributed to the period of relative calm in H1 2013, which witnessed higher levels of security and stability as efforts to redirect tourism back to Egypt were implemented. According to BMI forecasts, tourist nights in Egypt are expected to decrease over the coming years, reaching 54 million overnight stays in 2018. Despite the economic decline affecting the tourism
sector, recent socio-political stability in the region is strongly believed to signal future growth in Cairo’s high-end hotel sector. Promising indicators for Egypt’s tourism industry are the airport expansions and the optimistic pipeline of 10 capital-intensive Luxury hotel developments representing 2,653 keys to open between 2014-2019. The most successful markets of the past year was Sharm El Sheikh and Hurghada. A greater volume of domestic tourism and attractive room rates play a major part in keeping Red Sea market occupancies above
33.5%
30.3%
TOTAL SPENDING IN 2013 FROM INTERNATIONAL VISITORS
TOTAL SPENDING FROM BUSINESS TOURISM
66.5% OF TOTAL SPENDING IN 2013 FROM DOMESTIC TOURISM
12
the national average. Egypt’s economy has traditionally been reliant on its tourism industry, and the long standing, strong market fundamentals represent a solid investment opportunity for the tourism industry in the long term. An important aspect of the economic recovery will undoubtedly be drawn out from the tourism industry. Positive forecasts of increasing tourist numbers and increased capital expenditure provide an optimistic outlook on what has been a challenging past three years.
69.7% TOTAL SPENDING FROM LEISURE TOURISM
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DATA
35
14,118
12.6%
54M
54%
-17.9 %
NEW HOTEL SCHEMES
ROOM PIPELINE, MID-TERM
2013 GDP CONTRIBUTION FROM TOURISM
HOTEL NIGHTS COUNTED 2013, UP 1.6% YOY
INBOUND ARRIVALS FROM MICE
DROP IN INBOUND TOURISM
TO GDP (EGP BILLIONS) 2010-2018 (F)
LEISURE VS BUSINESS SPENDING 2013 60
69.7%
30.3% 60
0%
20%
20%
40%
60%
Leisure Spending
80%
100%
15% 13%
15% 11% 12%
60
Business Spending
11%
11%
11%
10% EGP Billions
Source: WTTC
60 60
5%
60 0%
TRAVEL & TOURISM CAPITAL INVESTMENT 2010-2018(F) 60 8% 5% 5% 5% 5% 50
EGP Billions
40
0%
1%
28
1% 0%
28 28
30
28 28
28
28
28
10
-5% 6%
60
4%
0
2%
-10%
0% Tourism GDP Growth (%)
Tourism GDP
-2%
28
Non-Tourism GDP Source: IME WTTC
-4%
20
-5%
-6%
20 10 20 11 20 12 20 13 20 14 (e) 20 15 (f) 20 16 (f) 20 17 (f) 20 18 (f)
60
-6% 8%
10%
AIRPORT CAPACITY INCREASE 10%
0
Annual Passenger Capacity Original After Expansion
20 10 20 11 20 12 20 13 20 14 (e) 20 15 (f) 20 16 (f) 20 17 (f) 20 18 (f)
12%
Capital Investment Source: WTTC
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Real growth (%)
Cairo Int’l Airport
12 Million
24 Million
Hurghada Airport
5.6 Million
13 Million
Source: Colliers International
13
DATA
2013 SNAPSHOT: KEY CITIES
HOTELIER INSIGHT In his capacity as both a former analyst
HURGHADA OCCUPANCY
and experienced hotelier, Marriott International MEA president and MD,
58.1%
Alex Kyriakidis, predicted in Q2 of this year that tangible growth would be seen
YOY OCCUPANCY
by the end of 2014.
-12%
Speaking to HBME¸ Kyriakidis said: “We are going to need a year of stability
JULY 2014 OCCUPANCY
for the tour operators and corporates
+2.8%
to reinvest and begin to reintroduce charter flights, and we are talking upper
ADR 2013
Egypt as well as Cairo.
-8.7%
The rest of 2014 will be the year when recovery will set in and by 2015
SHARM EL SHEIKH OCCUPANCY
end the market should be back to where it was pre 2010,” quoting STR
57.9%
Global occupancy figures of 80% at the country’s peak, pre-2010.
ADR
He added: “As soon as the elections
+4.1%
go through with minimal unrest in the country then there is a sense of stability,
JULY 2014 OCCUPANCY
we would expect from about October
-7.8%
onwards for the market to return.”
CAIRO OCCUPANCY
EGYPT MARKET OVERVIEW
2013
Y-O-Y Growth 2012-2013
2013
Population
Total Domestic Tourists
(Millions) 84.5
(Millions)
2.4%
15.9
GDP
Total Overnight Stays
(EGP Billions)
(Millions)
1.8
12.0%
Tourism GDP
+1% 8.8%
ALEXANDRIA 2013 OCCUPANCY 1.6%
-12%
43.4
JULY 2014 OCCUPANCY -14.3%
61%
Hotel ADR
(EGP Millions)
(EGP)
4.0%
519
Total Inbound Tourists
Hotel RevPAR
(Millions)
(EGP)
9.4
ADR
+15.9% JULY 2014 ADR
(Occupancy %)
-2.0%
Capital Investment
31
Y-O-Y Growth 2012-2013
Hotel Occupancy %
(EGP Billions; Real Growth %)
217
53.9
40%
-17.9%
203
-8.6%
LUXOR JULY 2014 YTD OCCUPANCY
-23.5% -9.0%
JULY 2014 YTD ADR
-18.6% Source: WTTC; World Population; Colliers International
14
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DATA
STR GLOBAL: PIPELINE REPORT AUGUST 2014 Riyadh, Saudia Arabia
Astana, Kazakhstan
REGIONAL BREAKDOWN OF HOTELS CONFIRMED AND UNDER CONTRACT INCLUDING CONSTRUCTION, FINAL PLANNING AND PLANNING STAGES
EUROPE
MEA
TOTAL:
TOTAL:
894 142,704
HOTELS ROOMS
HOTELS ROOMS
KEY MARKETS
KEY MARKETS
GEORGIA:
JEDDAH, SAUDI ARABIA
2,019
ROOMS
TAJIKISTAN:
285
ROOMS
BELARUS:
2,073
ROOMS
AZERBAIJAN:
1,333
ROOMS
KAZAKHSTAN:
2,038 16
628 147,454
ROOMS
7,396
ROOMS
RIYADH, SAUDI ARABIA:
10,095
ROOMS
DOHA, QATAR:
10,828
ROOMS
LAGOS, NIGERIA:
2,397
ROOMS
MUSCAT, OMAN:
3,006
ROOMS
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Jakarta, Indonesia
Mexico City, Mexico
DATA
ASIA PACIFIC
CARIBBEAN/ MEXICO
TOTAL:
TOTAL:
2,352 528,109
HOTELS
HOTELS ROOMS
JAKARTA, INDONESIA:
15,896
164
ROOMS
27,621 ROOMS
17.7% GROWTH UNDER CONTRACT
CHENGDU, CHINA:
13,251
ROOMS
SHANGHAI, CHINA:
12,763
14,848 ROOMS OPENED YTD
ROOMS
BALI, INDONESIA:
12,737
96 HOTELS OPENED YTD
ROOMS
28 HOTELS TO OPEN BY END OF 2014
58 HOTELS TO OPEN 2015
MANILA, PHILIPPINES:
10,509 hospitalitybusinessme.com
ROOMS
10,848 ROOMS TO OPEN 2015
17
DATA
STR GLOBAL: DUBAI’S POST-RAMADAN RECOVERY RECOVERY BEGINS FOLLOWING DUBAI’S “WORST MONTH IN 18 YEARS” DUBAI DAILY HOTEL PERFORMANCE 15 JUNE-14 AUGUST 2014 100%
AED 1000
Qcc
EID AL-FITR 2014 27-29 JULY 2014
ADR
AED 900 90%
Ramadan Period 2014
80%
Qcc
41.2
ADR
AED 576
RevPAR
AED 237
AED 800
AED 700
AED 600 70%
RAMADAN 2014
$1.08 ADR UP
7.8% SUPPLY UP
AED 500 60%
Ramadan 2014 | 28 June - 27 JULY 2014
50%
41.2%
AED 400
OCCUPANCY
AED 300
$156.82 ADR
AED 200 40% AED 100
30%
$64.52 REVPAR
AED 0
DUBAI DAILY HOTEL PERFORMANCE 15 JUNE-14 AUGUST 2013 100%
AED 1000
Qcc
90%
ADR Ramadan Period 2013 Qcc
42.7
ADR
AED 572
RevPAR
AED 244
EID AL-FITR 2013 7-9 August 2014
80%
AED 900
AED 800
AED 700
RAMADAN 2013
42.7% OCCUPANCY
AED 600 70%
ADR
AED 400
$66.42
60%
Ramadan 2013 | 9 July - 7 August 2013 50%
REVPAR AED 300
AED 200 40% AED 100
30%
18
$155.72
AED 500
AED 0
+2.2% PROJECTED REVPAR INCREASE, 2014-END
hospitalitybusinessme.com
ADVERTORIAL
PROCUREMENT
SUPPLIES AND SERVICES THE INDUSTRY’S LATEST PRODUCT AND SERVICE INNOVATIONS
HAMMAM RANGE FROM ADA COSMETICS ADA Cosmetics International (ADA) now offers a matching, exclusive cosmetics line called Hammam Spa, specifically designed for hotel bathrooms and spas. The term ‘hammam’ means ‘to warm’ and encapsulates the ancient wellness formula of relaxation and health, all of which are characteristics that form the Hammam range. Hammam Spa collection includes products such as a shower peel, body mud, shower gel, shampoo and conditioner, body cream and massage soap, available in 30ml, 150ml and 300ml tubes.
SERVICING HOSPITALITY Former JW Marriott Marquis GM Rupprecht Queitsch has been appointed senior partner and CEO on INHOCO Group, a privately owned hospitality consultancy firm headquartered in Dubai. Launched last month the group brings more than 200 years’ of hospitality experience and offers a range of consultancy services to hotel owners, operators, developers, investors and others wanting to be part of the hospitality industry. Services include detailed operating and marketing analysis, a selection of financial and feasibility services and more, explained Queitsch.
20
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PROCUREMENT
HANDCRAFTED FURNITURE A new furniture and joinery company, KnightsWood has officially opened its doors at two locations in Dubai, Al Quoz and Dubai Investment Park. Targeting the region’s hospitality industry, KnightsWoods products are all designed and handcrafted in the UAE to ensure quality. “With such a flourishing hospitality market in the UAE, and in particular Dubai, it was only natural that KnightsWood would launch here. Whilst we offer our services to anyone looking for luxury furniture for either their homes or businesses, the hospitality market is an industry we are focused on expanding into,” said Simon Crossland, managing director, KnightsWood.
REST EASY Intercoil International has launched the ‘Octaspring’, the latest innovation in mattresses from UK company Dormeo. An alternative to traditional metal springs and memory foam, Octaspring mattresses feature memory foam springs that mould to fit a person’s shape. Mattress features provide extra support, durability and ventilation. Each individual Octaspring, created in an eight-sided honeycomb design, works independently and collectively to rest the body in a state ensuring smooth blood circulation, relaxation of muscles and agile vertebrae alignment.
SMART SHOWERS Aquaelite, an Italian company focused on designing and manufacturing elegant and innovative shower systems, offers a wide range of tailor-made products using top quality materials and unique design. Built with 40 years of professional experience, Aqualite products are made under the company goal to improve resource efficiency in each step of production, reducing waste and minimising environment impact.The smart showers operate using waterproof wireless controllers, enabling its user to change the shower atmosphere with a touch, and turn on ‘chromotheraphy’ features that change the colour of the water.
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21
PROCUREMENT
UPPING FITNESS STANDARDS International sporting brand Reebok and Jumeirah Group’s health brand, Talise Fitness have teamed up to enable Reebok to become the official outfitter for all Talise outlets. “The alliance with Talise Fitness is a continuation of Reebok’s commitment to bring the latest and most sophisticated apparel and footwear to people seeking a healthy and active lifestyle,” commented Mark Greiner, general manager for Reebok Middle East.This alliance follows Reebok’s recent partnership with globally known fitness regimes, CrossFit, Spartan Race and LES MILLS.
LATEST COMMUNICATIONS LG Electronics (LG) has revealed a pair of its newest L Series smartphones, the L Fino and L Bello are now targeting growing 3G markets as alternatives to higher-priced smartphones. The L Fino and L Bello continue LG’s signature Rear Key button design and come equipped with an 8MP camera and UX features. Jong-seok Park, president and CEO of LG said: “Our newest L Series smartphones represent the best of LG in design, hardware and UX as well as our commitment to bringing best smartphone experience to 3G customers as many as possible.”
GREEN LIGHTING SOLUTIONS As per directives of the Emirates Standardisation and Metrology Authority (ESMA) sales of incandescent bulbs to the UAE will be prohibited from December 31, 2014. In line with this, energy-efficient LED lighting company, GE Lighting has launched a range of ‘greener’ lighting solutions and fixtures for residential areas. “Electricity for lighting accounts for nearly 20% of global power consumption and close to 6% of worldwide greenhouse gas (GHG) emissions. The shift towards efficient lighting solutions will help reduce emissions by half,” said George Bou Mitri, GE Lighting, general manager MEA and Turkey.
22
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PROCUREMENT
MAINTAINING INTERIORS SONIA MACHADO, SALES MANAGER AT THE LEATHER DOCTOR INTRODUCES THE COMPANY THAT IS EXPANDING WITHIN THE HOSPITALITY INDUSTRY TO MAINTAIN, REPAIR AND RESTORE DATED AND WORN INTERIORS
L
aunched in the United Arab Emirates in December 2011, Australia-founded leather repair company The Leather Doctor is now further branching out into the hospitality industry, bringing the craftmanship of cleaning, restoring and caring for fine leather products, to even more neglected and worn furniture. With clients to date including Hilton Hotels, The Jumeirah Group and Rotana Hotels, The Leather Doctor assists companies in protecting their investments, using a range of products that are gentle enough to not damage leather, however strong enough to restore a piece to its original state. Sonia Machado, sales manager, The Leather Doctor said: “Today, from our Dubai headquarters, a 20-strong team of technicians offers rapid on-location and workshop services throughout the UAE, applying practical and cost-effective leather repair solutions many customers have been seeking for years, especially hoteliers wishing to maintain standards in an ever-growing, competitive market.â€? The Leather Doctor is able to professionally clean and restore leather products including furniture, interiors, curtains and upholstery. They can repair or replace any damaged item, from cracked, scratched or torn leather seating, to scuffed and grazed lounge sofas and chairs. “For leather that is in need of a clean we are able to thoroughly condition furniture, which in turn extends a product’s life and saves time and money. Even serious damage such as a broken arm or base doesn’t mean the product must be thrown away. We are equipped to restore furniture to perfect FRQGLWLRQ Âż[LQJ VDJJLQJ VHDWV KHDGUHVWV and replacing panels,â€? she explains.
24
HARSH HOSPITALITY WEAR Catering to the hospitality industry, Machado explains that leather in hotel, cruise and transportation environments faces harsh conditions on a daily basis. “From direct sunlight and excessive heat to abrasive dirt and body sweat, combine them all together and they dramatically affect leather’s appearance and feel, reducing life-span. Hotel leather needs to be of the very highest standards to maintain custom as it represents the brand and brand quality. The Leather Doctor is able to eliminate pen marks, tears and scratches, in addition to other common miss-uses of travellers,� she commented. Not only repairing hotel furniture, The Leather Doctor offers services for interior panels, pillars and in-room features, such as repairing, re-colouring and replacing. The company specialises in eliminating tears and scratches, cleaning, conditioning
and repairing items regardless of age and condition. Machado concurs: “Our technicians have dealt with almost every type of leather JRRGV ÂżQGLQJ IDVW DQG SUDFWLFDO VROXWLRQV WR Âż[ DQ\ SUREOHP $OO RI RXU UHSDLU DQG alteration work is performed by-hand for the ultimate in detailed personal service.â€? To spruce up window areas, The Leather Doctor makes all types of curtains, blinds, custom window shades, shutters, draperies and more with installation and accessories to match existing interiors. “We offer a wide range of fabric and materials to suit our customer’s taste and budget,â€? said Machado, adding that: “We specialise in providing a bespoke tailor made service for our clients. “We use only qualified and experienced machinists to make window and door coverings. Our experienced design professionals will work with hotel design
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PROCUREMENT
BEFORE
AFTER
“OVER TIME, UNPROTECTED LEATHER LOSES ITS SPECIAL TOPCOAT SEALERS, ALLOWING DISEASE, GERMS AND POTENTIALLY DANGEROUS MOULD TO ENTER, RESULTING IN LEATHER ROT, PARTICULARLY IN HOTEL ENVIRONMENTS”
teams to find a solution that looks great and provides the privacy and light control required in a room, all within a budget.”
MAINTAINING STANDARDS Offering a word of advice, Machado believes that if leather products have not been cleaned in the past 12 months then the deterioration of the product will be accelerated. She explains: “Without regular
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professional cleaning, leather is unprotected from daily wear and tear and faces a build-up of dirt and grime as well as exposure to harmful fluids including body sweats, acids and oils. Over time, unprotected leather loses its special topcoat sealers, allowing disease, germs and potentially dangerous mould to enter. This results in leather rot, particularly in hotel environments where many different people are using the furniture every day.
Regular cleaning and conditioning will keep products in top condition for years to come.” While thousands of new-build properties are in the regional pipeline, existing hotels now feel the pressure to keep up with competition, ensuring offerings are up-todate and fresh, while minimising or even eliminating the cost of a full refurbishment outside of the usual seven year cycle. Over time with wear and tear, leather products lose their colour and can create a dullness within a room. However, The Leather Doctor can either re-colour the item to its previous glory or change the colour entirely. “For a fraction of the cost of replacing an original leather item, we can turn tired leather seats of any colour into likenew products. We offer a wide range of colours or are able to match any shade a client requires,” Machado said.
25
PROCUREMENT
INTERNSHIP WITH A DIFFERENCE 4 CORNERS INTERN, HEBAH AL BLOOSHI, IS TRACKING THE EFFICIENCY OF THE UAE’S HOSPITALITY SUPPLY CHAIN. IN THE FIRST OF SIX ACCOUNTS OF HER WORK, SHE TELLS SOPHIE MCCARRICK ABOUT THE MISSED OPPORTUNITIES TO REDUCE POLLUTION AND SAVE TIME AND MONEY
A
s more hotels in the region strive to REWDLQ HQYLURQPHQWDO FHUWLÂżFDWLRQV ahead of a sustainably themed Expo2020, Hebah Al Blooshi, student at The Emirates Academy of Hospitality Management, is using a six month internship with food service specialists 4 Corners to measure the environmental impact of food distribution in Dubai. As part of her three year hospitality undergraduate programme, the internship will see Al Blooshi tasked with exploring ways in which F&B teams in the UAE procure and receive F&B supplies, whilst calculating the carbon footprint generated by a property’s supply chain. At the end of her internship with 4 Corners, Al Blooshi will be able to analyse the carbon footprints of hotels, providing the opportunity to show industry just how detrimental its procurement decisions are to the environment currently. Al Blooshi comments: “As a nation we need to be looking at environmental issues on a grander scale, hotels here are not yet using green supply chains. Most of them are using hundreds of suppliers per week to deliver items and it has terrible pollution implications. “I don’t know if it’s a matter of ignorance RU FRQYHQLHQFH EXW LWÂśV GHÂżQLWHO\ WLPH for procurement teams to be more open to consolidated transportation methods. It not only helps the environment, but in the end also saves them money,â€? she adds. 'XULQJ WKH ÂżUVW PRQWK RI KHU LQWHUQVKLS with 4 Corners, Al Blooshi reveals that one chef she spoke to disclosed his F&B
26
FOR PROCUREMENT
global markets, she says the destination is still a young market and needs time to adapt. Furthermore, she comments: “The problem here is also that the UAE is very luxury-focused and many people don’t care about costs. There is a mentality of ‘I want it, and I’ll get it’. So how products are delivered or imported isn’t considered.� She adds: “Dubai is a very transient place, people are coming and going so are not necessarily worrying about implications of their bad decisions in 20 years’ time. I want people to understand that their decisions have global consequences. The green concept has to be a universal effort.�
TEAMS TO BE MORE
FUTURE HOPES
HEBAH AL BLOOSHI STUDENT AND INTERN
“IT’S DEFINITELY TIME
OPEN TO CONSOLIDATED TRANSPORTATION METHODSâ€? team, on a weekly basis, procures from 140 suppliers for a single hotel, clocking up 14,000km on the roads daily, and 5.1m kilometres per year. She notes: “4 Corners could reduce this ÂżJXUH E\ LI ZH FRQVROLGDWHG WKH VXSSO\ chain from one or two truck deliveries instead of 140 single deliveries carrying just a few items each. Chefs I’m speaking to want to introduce the unique 4 Corners onestop-shop supplier concept, however they admit the decision is out of their hands.â€? Living in Dubai since the age of four, Al Blooshi is a Kuwait national and admits she has seen a lot of change in the city whilst growing up here. When considering why the green supply chain has not yet gained momentum in Dubai in comparison to other
Moving forward with her internship, Al Blooshi will be travelling to the UK to compare its supply chains to the Middle East’s; interviewing a range of chefs and hotel professionals as well as analysing the goods in operation at various hotels. Although studying to specialise in hospitality, Al Blooshi notes that she’s always been more interested in back of house operations and the business element of hospitality. “My aim is to one day open my own restaurant, so it’s great learning how to procure properly. This internship, unlike many others, allows me to do something great for the environment and allows me to achieve something worthwhile at the end,� she says.
HBME will follow Hebah Al Blooshi’s internship journey and achievements over WKH QH[W ¿YH LVVXHV
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DESIGN & TECHNOLOGY
MODERN TOUCHES FOR BASIC NEEDS WITH A FRESH FOCUS ON THE HOSPITALITY INDUSTRY AND THE FIRST SHOW ROOM OUTSIDE THE US OFFICIALLY OPENED LAST MONTH, IN ABU DHABI, DELTA FAUCET IS TAKING ITS ALL AMERICAN BATHROOM TECHNOLOGY TO THE NEXT LEVEL
H2OKINETIC
H2Okinetic速 uses a combination of engineering and design to flow water at 1.5 and 2.0 gallons per minute (gpm), through an intricate maze of moving components, that creates the feeling of a full flow shower experience, while reducing actual water consumption by 40%. The effect is achieved by flowing the water to create larger drops. The technology has been applied to a range of Delta Faucet products. This year, Delta has expanded its H2Okinetic offering to include options that allow users to toggle between spray settings for a customised shower experience. New three function H2Okinetic raincan showerheads provide users the option to pause the flow of water and switch between an H2Okinetic spray or full spray. The five setting H2Okinetic showerhead incorporates five spray options: H2Okinetic spray, fast massage, full body, soft drench, and pause. The technology is also available on handshowers, body jets and sprays, as well as a variety of showerheads within existing bathroom collections. A three function H2Okinetic Raincan showerhead, as well as a five setting H2Okinetic showerhead showerhead, is available in Chrome, Brilliance, Stainless, Polished Nickel, Champagne Bronze and Venetian Bronze.
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Left, a demonstration of one of the channels water is forced through within the shower head and above, the effect of the full product.
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DESIGN & TECHNOLOGY
TOUCH2O & TOUCH2O.XT
When Delta Faucet introduced Touch2O® Technology in 2008, it changed the kitchen faucet experience. Born of ethnographic research and human behaviour studies, Touch2O Technology satisfied an unmet and unarticulated need to enhance the way users turn on the faucet with messy hands and turn off the water when water is not needed between tasks. Lavatory faucets from the Talbott and Lahara bath collections are available with
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Touch2O Technology, allowing the user to tap the faucet on or off anywhere on the spout or handle. For an even cleaner experience, Addison and Lahara models feature Touch2O.xt Technology – “xt” for extra technology – that also offer an entirely hands-free experience. Other features include Diamon Seal technology to prevent erosion of internal product parts, temperature lock settings and are Water Sense labelled.
The WaterSense program is a U.S. Environmental Protection Agency (EPA) partnership program that aims to protect the future of the U.S. water supply by providing people with easy and identifiable ways to conserve water. Look for the WaterSense label on Delta lavatory faucets, toilets and showers to ensure your new product meets the EPA’s water conserving guidelines. While not directly relevant to sustainable criteria in the GCC, the label does accredit Delta Faucets products for their sustainability and water saving properties.
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DESIGN & TECHNOLOGY
DIAMOND SEAL TECHNOLOGY
Delivering easy installation and longlasting performance for the life of the product, Diamond Seal technology combines a durable DIAMOND Valve with InnoFlex PEX waterways. The valve requires no lubrication, eliminates wear on seals, and ensures “like new” operation for the life of the faucet, which is counted as being up to five million uses; 10 times the industry standard. The InnoFlex waterways eliminate potential leak points and are easier to install. With DIAMOND Seal Technology, water does not come in contact with metal surfaces once inside the faucet, meeting all current and upcoming U.S. lead free legislation. Instead, ceramic parts are used with a lubricant to prevent each grinding on the other. The handle limit stop on Delta Faucet’s DIAMOND Valve cartridge helps to limit the range of the handle motion for hot water from full flow to a 50/50 mix. This feature is the smart choice to protect sensitive skin from scalding.
PRODUCTS FEATURING DIAMOND SEAL TECHNOLOGY:
Brizo bath Collections Vuelo Solna Belo Delta bath Collections Addison Lahara Trinsic
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Delta Faucet Company is a wholly owned subsidiary of Masco Corporation, one of the world’s leading manufacturers of home improvement and building products, as well as a provider of services that include the installation of insulation and other building products. All its products are manufactured in Jackson, Tennessee. Delta Faucet’s ranges include the staple Delta and upmarket Brizo. All products are available for commercial and residential projects.
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CONVERT into useful energy
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RECYCLE
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DESIGN & TECHNOLOGY
CREATING INNOVATIVE SOLUTIONS COLLABORATING WITH HOTELS WORLDWIDE, LAST MONTH LEGRAND PRESENTED A DELEGATION OF HOTELIERS WITH THE LATEST INTEGRATED DESIGN SOLUTIONS AND PRODUCTS AVAILABLE TO THE HOSPITALITY SECTOR Clockwise: Milka Eskola, group VP art and design at Legrand, Experiencing product options and Audience Q&A.
32
G
lobal specialists in electrical and digital building infrastructure, Legrand, recently hosted an exclusive seminar to bring focus to the key pillars of design, efficiency, cost control and sustainability when applied in the hospitality industry. Attended by hotel technical, engineering and design professionals, the event presented delegates with keynote presentations and product demonstrations by Legrand’s Milka Eskola, group VP art and design, Thibault De-Heere, group business developer, and Talha Abdul Wadood, project sales manager. Exploring interactivity and design, Eskola explains: “Legrand’s solutions are adaptable to all hotel aspects. We cover everything from power supply, standard products, enhancing and integrated functions, to smart and electrical solutions and services. All of which we collaborate with intuitive, interactive design and innovative technology.” When developing new products, she notes that Legrand consider a variety of verticals to apply to devices, such as adaptability, new solutions, commercial outlook and prospective design. “It’s really important that we keep looking at the future and understand what is to come. Current trends show that people really like adaptive products, such as pop-out plugs, wave switches, WiFimusic, portable video, sensor dimmers and more,” says Eskola. From Legrand’s latest conceptual range, Flocoon, products within the collection offer features such as a ‘cool me’ solution, which allows its user to blow on the panel
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Italians are famous for their expensive taste...luxury cars, high fashion, big brands. Now you can enjoy Italian quality without the Italian price tag. Everyone deserves good food...enjoy Granoro.
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Contact us today to sample the full range of Granoro products: pastas, sauces, condiments and more. www.4cornersuae.com +971 4 884 7248 or email sales@4cornersuae.com
DESIGN & TECHNOLOGY
when wanting to feel cooler, or ‘warm me’ by covering the product when wanting to feel warmer. “A hotel environment is the idea test ground for intuitive solutions, since users have little time to familiarise themselves with the products in-room. Guests come from different backgrounds and cultures and therefore solutions and appliances inroom need to be as universal and accessible as possible,” Eskola adds. Looking at hospitality solutions, DeHeere explains that Legrand’s international experience covers the whole hospitality spectrum, encompassing any type of hotel or building whether it be budget or
luxury, branded or independent, business or leisure. Furthermore, Wadood brought attention to local support and services available to clients. “At every stage of a project, our corporate and local teams are available to offer support and assistance. Whatever the nature of an inquiry is, whether commercial or technical, or for information regarding standards and regulations, we are here to assist,” he says. In collaboration with several hundred hotels around the world, Legrand has recently entered into design projects with Dubai-based properties Sofitel Downtown Dubai, Waldorf Astoria, The Palm and is
now working on the on-going development, Al Habtoor City, comprising three properties to be operated by Starwood. Legrand has a 19% market share, with a 15% market share in cable management products. In 2012, more than 2,100 people were dedicated full-time to research and development and, on average, the company invests 4.6% of its sales each year in research and design. Legrand’s catalogue of 200,000 products is continuously expanding and hopes to further collaborate with the hospitality community to grow the product range and provide the latest solutions on the market to date.
Clockwise: Product demonstration, Thibault De-Heere, group business developer, Legrand, Talha Abdul Wadood, project sales manager, Legrand and Legrand product display.
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PRE REGISTER ON TODAY www.cmepexpo.com/visitors/
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DEVELOPMENT & INVESTMENT
Above, a concept image of the completed Mid Field Terminal Complex, Abu Dhabi and right, Dubai International.
36
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DEVELOPMENT & INVESTMENT
TAKING FLIGHT ONE YEAR AGO, THE UAE OPENED ITS 10TH AIRPORT, ONLY 90KM AWAY FROM ANOTHER AIRPORT DEVELOPMENT SO BIG IT CAN BE SEEN FROM ALMOST 2KM AWAY. FOLLOWING THE ANNOUNCEMENT OF FURTHER EXPANSIONS, THE AIRPORTS OF ABU DHABI AND DUBAI WILL SOON BOAST A PASSENGER CAPACITY OF 315 MILLION. BUT HOW WILL THE RELOCATION OF THE COUNTRY’S MAIN AVIATION HUBS AFFECT LOCAL HOTEL INDUSTRY DYNAMICS?
I
t’s no secret the UAE has big ambitions as a global transport hub. Within 15 years, its three largest airports will have the capacity to handle almost as many passengers as the three busiest airports in the world handled in 2013. Yet far from anybody questioning if such an ambition is possible, the issue on the minds of the country’s top hoteliers is how the opening of one new aerotropolis – sandwiched between Dubai International, less that 70km to one side and Abu Dhabi International 90.5km to the other – will affect the focus of hotel development. Today, following the opening of Concourse 3 in early 2014, Dubai International, the home of Emirates Airlines and the airfield which spurred the urbanisation of Dubai Creek, Deira, Bur Dubai and beyond, has a total passenger capacity of 75m. It is currently the world’s second busiest airport behind long-time record holder, Hartsfield-Jackson, in Atlanta, USA. Dubai airport has been a catalyst for business, development, and of course tourism, since it opened in 1960 and its expansion will continue to be key in Dubai’s ambitions to attract an increasing number of tourists. But since the beginning of Dubai’s bid to host Expo2020, focus has moved to the
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other side of town where Exhibition City will be constructed on a 400 hectare site, close to the newly opened Dubai World Central and Al Maktoum International Airport. That focus was strengthened again last month with the announcement that Al Maktoum International has already scheduled a $32bn expansion, that will allow for up to 200m passengers to travel through the airport annually. If you want to imagine the size of the development, consider it will be big enough to house 100 A380s at any one time. Combine these figures with the statistics backing Expo City and the proximity to Abu Dhabi International and the area could trigger a serious change in dynamics. Burjuman Arjaan by Rotana GM, Chantele Moore, asks: “What is interesting to see is how the ‘area to be’ has moved from Bur Dubai, slowly closer to Abu Dhabi. Now we have seen Dubai World Central open up, my question will be, are people going to move into that end of town and build hotels in that area? “It’s the only area with beach front left to develop and if it were to be announced that 10 hotels would be developed and all the airlines were going to move there that would decide what happens in the
37
DEVELOPMENT & INVESTMENT
While Emirates has its own terminal at the existing Dubai International, expansions could see some or all operations move.
market next,” she adds, asking how Bur Dubai, Deira and Sheikh Zayed Road would compete for business in the new environment, particularly since Air France/ KLM moved its regional hub to the new base a matter of weeks ago. “Out of all the questions, that’s my first one,” she continues. Yet Starwood’s Dubai area manager, Stephan Vanden Auweele – who is also general manager of Sheraton Dubai Creek Hotel and Towers – begs to differ. Commenting on the recently completed expansion at Dubai International and the renewed appetite to develop The Palm Deira, he says: “Speaking with the chairman of Nakheel last week, their commitment to Deira with the development of the Deira Palm will surely re-activate Deira as an attractive
200m
UPPER PASSENGER CAPACITY PROJECTION FOR DWC, BY 2030
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2013’S BUSIEST AIRPORTS
HARTSFIELD-JACKSON ATLANTA: 94.4 million (-1.13% on 2012)
new focus will be given on re-developing the areas where Dubai started. “With culture and heritage both high on DTCM’s agenda, I believe Deira has a great future ahead,” he adds. Acknowleding the potential shift in focus, Radisson Blu Hotel Dubai Deira Creek GM Tim Cordon, maintains that demand for hotels in Dubai’s oldest area remains high. He says: “Deira Creek will always be a unique spot in Dubai and an area that every visitor in the city must see. There are great plans and ideas that have been launched by Dubai Government for the development of Dubai Creek, most of which are related to leisure and tourism activities.” With heritage firmly on the agenda, the hotel is currently undergoing refurbishment work which will see many of its older features protected and restored. “We know that there are a great number of tourists who are interested to see a different side of Dubai – its cultural and historical heritage, and the Radisson Blu hotel in Deira Creek is and will always be, part of the great history that Dubai is building.”
BEIJING: 83.7 million (+2.2% on 2012)
HOW MUCH IS TOO MUCH? LONDON HEATHROW: 72.3 million (+3.4% on 2012)
destination in Dubai. While this is only one of the projects, it is surely the largest and others will help to give a focus on this part of town. “In the last 10 years the focus has been on developing the newer areas, which were needed to fuel the enormous growth of Dubai. Now that this is done, I am sure
30m
CAPACITY AT EXPANDED HAMAD AIRPORT, DOHA
100
A380 CRAFT CAN BE ACCOMMODATED AT DWC AT ANY TIME
While the GCC’s general approach towards mega developments – specifically those in the hospitality and tourism industries – is akin to ‘build it and they will come’, some do express concern that passenger targets may not hit schedule. Less than 100km apart, Abu Dhabi Midfield Terminal Complex (MTC) and Dubai World Central will serve a combined 240 million passengers. Consider the combined population of all six GCC countries only last year hit 50m. Currently, Dubai International serves 60m passengers – rising to 75m per annum upon completion of the dedicated A380 Concourse 3. It is the world’s busiest hub for international traffic. Abu Dhabi International serves 12.5m currently and upon completion of MTC capacity will reach 47m. The numbers are dizzying yet in global
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DEVELOPMENT & INVESTMENT
1969
ABU DHABI’S FIRST AIRPORT OPENED, TODAY IT IS AL BATEEN EXECUTIVE AIRPORT
2
nd
BUSIEST AIRPORT GLOBALLY IS DUBAI INTERNATIONAL AIRPORT
context the viability of the three combined projections is much higher. While Al Makhtoum International is the UAE’s 10th airport in a country with a total population just short of 8m people, the cities of London, New York and Vancouver each have six airports. Their respective populations stand at 8.1m, 8.2m and 4.1m when the wider British Columbia area is included. The ‘tropolis’ element of DWC’s ‘aerotropoilis’ vision will eventually be home to 900,000 people. The three airports will be looking to capitalise on their geographic location,
75m
COMBINED CAPACITY OF ALL THREE DXB TERMINALS
local tourism industries and massive population increases over the coming two decades, as the region where 50% of the people are under 30, continues to boom.
MORE THAN AN AIRPORT Elsewhere, in Qatar Hamad International Airport – which replaces Doha International, has capacity to handle a further 30m passengers. Saudi Arabia currently operates six international airports, with a further 27 domestic, regional and private facilities. As is the way in the region, where there are residential developments and airports,
hotels are sure to follow and, as Moore predicts, we will no doubt see a shift in activity that could have huge implications for Dubai’s older areas. Ironically it was these areas that enjoyed immunity to seemingly endless construction projects over the last decade, and increased amounts of business as a result. On the note of whether or not the UAE needs another mega–aviation project, DWC executive chairman, Khalifa Al Zaffin, says: “Put it this way; I think all of these areas and airports will eventually complement each other. It will be a fantastic thing for travellers to choose the best airport to travel through and they will compete to make passengers happy and make money. “So whether you are a trader, registered person, a person who wants to transfer goods quickly, or even just a trader in Dubai, we want to make all these people’s experiences the best.”
Arrivals terminal at Dubai International, the world’s second busiest airport.
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INFOGRAPHIC
FLYING HIGH
*30,000,000 PASSENGER CAPACITY ABU DHABI MIDFIELD TERMINAL
AVIATION IN THE MIDDLE EAST
30,000,000 PASSENGER CAPACITY HAMAD INTERNATIONAL AIRPORT, DOHA
20,000,000 PASSENGER CAPACITY KUWAIT INTERNATIONAL AIRPORT
FUELLING ECONOMIC GROWTH
$22 BN or 28% Aviation industry contribution to Dubai’s GDP
$550 BN Value of the Middle East aviation market expected to receive delivery of 2,610 aircrafts between 2012 and 2032
$32 BN
136 M
Al Maktoum International Airport expansion
Number of tourists to the Middle East by 2020
$4 TN
$86 BN
Towards Middle East’s travel and tourism projects
Is being set aside for Middle East airport development
Sources: Abu Dhabi International Airport | IATA | Dubai Airports | GE Aviation MENA | Amadeus – Securing the Prize for the Middle East | Oxford Economics | Alpen Capital’s GCC Aviation Sector Report 2014
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INFOGRAPHIC
160,000,000 PASSENGER CAPACITY AL MAKTOUM INTERNATIONAL AIRPORT AT DUBAI WORLD CENTRAL set to become the world’s largest airport
12,500,000 PASSENGER CAPACITY ABU DHABI INTERNATIONAL AIRPORT
DID YOU KNOW?
66,000,000 PASSENGER CAPACITY DUBAI INTERNATIONAL AIRPORT Expected to reach 100 million by 2020 with $7.8 billion being pumped in the 2020 expansion plan
The UAE and Saudi Arabia account for 73% of the total fleet size of the GCC aviation sector
27,000,000 PASSENGER CAPACITY BAHRAIN INTERNATIONAL AIRPORT * All capacities are per airport per year
GLOBAL IMPACT
DXB Second busiest airport globally
77 M to 160 M Significant increase in the number of air passengers in MENA – from 2003 - 2012
Passenger Traffic Growth at Key Airports (2008-2012) Muscat Intl. Airport
17.2%
Doha Intl. Airport
14.6%
Abu Dhabi Intl. Airport
13.0%
Dubai Intl. Airport
11.4%
King Khalid Intl. Airport
11.1%
Sharjah Intl. Airport
Al Maktoum International Set to be the world’s largest airport upon its completion in 2027
9.2%
Kuwait Intl. Airport
5.3%
Hong Kong Airport
3.8%
Amsterdam Airport
1.8%
Frankfurt Airport
1.8%
Heathrow Airport
1.1%
JFK Airport
2 BN Number of people within 2.5hours reach via air from the Middle East
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0.8%
Aeroports de Paris
0.5% 0%
5%
10%
15%
20%
CAGR (2008-2012)
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DEVELOPMENT & INVESTMENT
TURNING THE TIDE AS DIRECTOR OF OPERATIONS AT NAKHEEL ABDULLA BIN SULAYEM HEADED SOME OF THE WORLD’S BIGGEST AND MOST AMBITIOUS HOSPITALITY PROJECTS, FROM ISLANDS RECLAIMED FROM THE SEA TO MALLS AND RESIDENTIAL COMMUNITIES. NOW CEO OF SEVEN TIDES, HE SPEAKS EXCLUSIVELY TO MELANIE MINGAS ABOUT SPEARHEADING THE FIRM’S GROWTH AND THE FUTURE OF DUBAI
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DEVELOPMENT & INVESTMENT
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DEVELOPMENT & INVESTMENT
A
bdulla Bin Sulayem is not a man who likes to stand still. In fact the CEO thrives on change to such an extent that nothing he works on is ever truly ‘finished’. Well, at least not for long. A year after his hotel and real estate development company Seven Tides celebrated the opening of its Anantara Dubai The Palm resort – the operator’s first property in Dubai – he’s already looking at how to improve the breath taking Thai-inspired resort. From expanding F&B space to upgrading light bulbs, nothing is beyond his sights. He applies the same culture of innovation to his own career. When he left his post as director of operations for Nakheel, after dedicating five years to projects that have since
grown to define both Dubai and a new global age of hospitality and leisure development; falling into obscurity wasn’t an option. “What excites me the most is challenging myself. You have your existing properties and you are happy with what you are achieving, what you are doing, but what can you do next? How can you improve?” Taking on the role of CEO at Seven Tides in April 2011, the company his father, former DP World chairperson Sultan Ahmed Bin Sulayem, founded – as well as the family’s real estate firm Asteco – Bin Sulayem has since become one of the biggest names on the UAE’s business landscape and 2014, the 10th year since the company launched, will mark another chapter in its story.
CEO Seven Tides and Asteco, Abdulla Bin Sulayem.
“WE WOULD RATHER PUT ALL OUR ENERGY AND INVESTMENTS INTO DUBAI AND BEYOND DUBAI INTO EUROPE AND ASIA” 44
THE COLLECTION Seven Tides’ hotel assets today include Movenpick Ibn Battuta Gate, Anantara Dubai The Palm and Dukes Hotel London. While the collection’s growth has been gradual since Dukes was acquired in 2006, Bin Sulayem confirms that before 2015 two more Dubai-based hospitality projects will launch. Full scale expansions into Asia and Europe will follow. If that wasn’t enough there is also potential for Bin Sulayem to incorporate his interest in F&B into Seven Tides’ next wave of activity. “All the new developments are exciting and you can’t stay where you are for one year, two years, three years. You always have to look ahead to increase revenue and build new projects. As developers we always like to start something new and grow the business.” At the time of interview they are courageous plans to disclose, considering the day prior data released by STR Global showed Dubai’s hotels had just experienced their worst month in 18 years. But although Bin Sulayem harbours ambitions to take the Seven Tides name to other shores, he remains one of Dubai’s most enthusiastic advocates and is quick to highlight that Seven Tides’ hotels bucked the trend – in some cases significantly. STR’s figures reported an average occupancy rate of 45.4% for July 2014 yet Movenpick Ibn Battuta Gate and Anantara The Palm both experienced high occupancy rates, with the latter over 85%. In 2013, Deloitte reported the average occupancy rate for hotels on The Palm Jumeirah stood at 71%. “Overall the [visitor] numbers are increasing and there are more passengers at the airport. July was an exception because Ramadan was a full calendar month and it’s the lowest season of the year because of the weather. I’m not surprised to see those results, but overall occupancy is high,” he comments. Competition doesn’t phase Bin Sulayem. When it comes to the ups and downs of market forces, the Seven Tides strategy is
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THE PORTFOLIO tIbn Battuta Gate Hotel
Above Ibn Battuta Gate and right, images of one of 12 penthouses at the Anantara Residences.
tIbn Battuta Gate Residences t I bn Battuta Gate Offices & Robotic Parking t A nantara Dubai The Palm Resort and Spa tAnantara Residences Dubai the Palm tOceana Residences t W est 14th Restaurant (Ocean Beach Club, Palm Jumeirah) tDukes Hotel London
to develop and own assets that combine USPs based on location and theme. The resulting concepts are interesting to say the least; the gate at Movenpick Ibn Battuta Gate is higher than the Arc de Triumph and the hotel will benefit from its proximity of the new Dubai World Central
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“WE HAVE A LOT OF FAITH IN THE DUBAI MARKET; IT IS A and Expo City. Anantara The Palm is home to the first over water villas in Dubai, complete with glass flooring, boasting Burj Al Arab views on one side and sunset to the other.
GROWTH TRAJECTORY While some neighbouring markets have faced slow starts or burn out due to the disparity between supply and demand, Bin Sulayem is confident Dubai’s story will continue on an upwards trajectory. “Dubai is a hub that connects different parts of the world. The government has spent a lot of money on the infrastructure and there is room for expansion. These projects, in my opinion will complement existing business and create even more business.”
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SAFE PLACE TO INVEST, AND THERE ARE ALWAYS A LOT OF THINGS GOING ON” That business includes announcements in the last 18 months alone for the second ‘world’s largest mall project’; an extension of the creek that will see the arterial Sheikh Zayed Road re-routed and bridged; as well as residential projects valued in the billions of dollars. Over the coming 18 months 140 new hotels are due to open.Does this level of activity create any caution? “No, I think the market can cater to all of this. I think looking at the UAE’s surrounding places, there are a lot of factors that are increasing tourism here
and many reasons for people to move their businesses here and live here, as well as visit,” Bin Sulayem says, crediting the government for creating solid infrastructure. Recalling how this isn’t the first time people have called Dubai’s developments crazy, he adds: “When Dubai Mall was first announced with the world’s largest performing fountain, the largest tower, the surrounding area developments, people thought it was crazy. You go there on any day now and you will struggle to park.
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Far left: Anantara Residence Views and near left, dining at Anantara Residences.
PROFILE Abdulla Bin Sulayem is the Chief Executive Officer of Asteco, a property management company, and Seven Tides, a real estate and hospitality developer. He spearheads strategic planning and management of the company’s luxury five-star properties which include the Anantara Residences Dubai The Palm Jumeirah, Anantara Dubai The Palm Resort and Spa, Movenpick Hotel Ibn Battuta Gate, the Oceana Residences and Dukes Hotel in London. Prior to these roles, Abdulla was the Director of Operations at Nakheel where he was responsible for operational functions at Palm Deira. Abdulla holds a Bachelor’s Degree in Human Resources Management from Middlesex University.
Year round, people are there looking at the fountains and it’s just a major attraction of Dubai. Exercising a similar sense of immunity, Seven Tides’ venture into Dubai’s booming F&B scene shows an increasing likelihood, although whether this will be through acquiring a brand for stand-alone concepts, or bringing big brands into its existing hotel assets, goes unconfirmed. As a reported foodie himself, it’s an area where Bin Sulayem sees potential to contribute to a scene that could evolve to the same scale as New York or London. “If you look at Dubai over the last five years, the international names are opening here and I know there are more to come before the end of this year. So I think this is something important if you get the right brand for your concept it adds value to your development, so this is another sector we may look at.”
UNIQUE EXPERIENCE While ambition is a necessary element of any business on a growth trajectory,
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in the case of Seven Tides it is far from blind. The company’s growth to date has been incredibly measured and now, ten years after its inception, the collection of three hotels, three residences, an office development and one restaurant, will expand with significance. The philosophy underpinning the new developments is far removed from the current business zeitgeist of more, more, more. In response, Bin Sulayem comments: “In all our hotels, we don’t look at a standard asset for the sake of generating income, it should be a unique experience for everyone who can use the hotel for any purpose. If it’s for room nights, meetings, events, fine dining; it should be an experience for all those guests.” Knowing what to launch where also helps. Sales of the Anantara Residences on The Palm entered the second phase earlier this year, after the first two phases sold out and the market forced apartment prices on the “eighth wonder of the world” up 33%. It’s testament to Bin Sulayem’s understanding of the intricacies of the
local market; an understanding honed over years of experience. “I gained a lot of experience with Nakheel on various projects that included infrastructure, reclamation, construction and building a team. It was very interesting for me to gain all that experience then be able to focus on the growth of the family business… plus the hospitality industry is very interesting for me. It’s not your routine industry. Every development has its own characteristics,” he continues. For those things in which he isn’t an expert, the know-how of Seven Tides’ hotel operating partners is paramount. Looking to the future, as those partners grow, in tandem with the company and its native city, the next ten years in the Seven Tides story could be very different. “We have a lot going on in Dubai and we will be continuing with that. We have a lot of faith in the market; it is a safe place to invest, and there are always a lot of things going on, which we appreciate. It’s the only place to be in the Middle East,” he concludes.
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Presents
UAE PROFESSIONAL
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26TH November 2014, Dubai Venue TBC
EXCLUSIVE SPONSOR
TO FIND OUT HOW TO PARTICIPATE IN THE DECEMBER EVENT PLEASE CONTACT Sales Director
Sales Manager
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OPERATIONS
S
ince the launch of JA Ocean View Hotel at The Walk, Jumeirah Beach Residence Dubai early last year, property general manager, Otto Kurzendorfer has witnessed VLJQLÂżFDQW JURZWK DQG H[SHFWV WR VHH Âą occupancy growth by the end of this year. Having evaluated what does and doesn’t work at the hotel following his appointment in September 2013, Kurzendorfer reveals the hotel is currently developing two new GLQLQJ FRQFHSWV LQ DGGLWLRQ WR LWV H[LVWLQJ RIIHULQJV VHH ER[ “The two new F&B outlets will be fantastic additions to JBR’s dining environment and will incorporate our concept dining theme, so watch this space.â€? Looking at changes made since the hotel’s opening, he says: “We have completely refurbished the pool deck, replacing it entirely with composite wood, which stays cooler when in direct sun light. We added a whole new deck area called ‘the quiet zone’ in addition to a new children’s playground following growth seen in the family tourism VHFWRU DQG ZH KDYH 6SHHG)OH[ WR RXU J\P a very cardio driven full-body workout, and WKH ÂżUVW RI LWV NLQG LQ WKH 8$( ´
POSITIVE PROJECTIONS
OCEAN VIEWS GENERAL MANAGER AT JA OCEAN VIEW HOTEL, OTTO KURZENDORFER, TALKS PROPERTY ESTABLISHMENT, OPTIMISTIC FORECASTS AND THE UPCOMING INTRODUCTION OF TWO NEW DINING CONCEPTS SOPHIE MCCARRICK REPORTS
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$OWKRXJK KH LV XQDEOH WR UHYHDO VSHFL¿F ¿JXUHV .XU]HQGRUIHU H[SODLQV WKDW occupancy results for H1 2014 were ³H[WUHPHO\ SRVLWLYH´ ZKHQ FRPSDUHG WR WKH same time period last year. 7KH *0 H[SHFWV WR VHH IXUWKHU JURZWK QH[W \HDU GHVSLWH LQFRPLQJ FRPSHWLWLRQ LQ the area, because of the hotel’s positioning as a value for money product. He concurs: ³:H ZLOO QHYHU EH WKH PRVW H[SHQVLYH KRWHO in this area.� Last year, development across JBR had a GH¿QLWH QHJDWLYH LPSDFW RQ RFFXSDQF\ GXH WR WUDI¿F DQG FRQVWUXFWLRQ KRZHYHU WKLV phase has now passed following opening of The Beach development eight months ago, enriching the hotel’s business. +H H[SODLQV ³-$ 2FHDQ 9LHZ +RWHO is a value for money product and very
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competitive in JBR. We are established across the main feeder markets to Dubai, and moving forward it’s now time to target new source markets such as China, India, Africa, South America, and South Europe.â€? Kurzendorfer says he’s noticed increased GHPDQG VSHFLÂżFDOO\ IURP &KLQD DQG at present JBR’s main source markets are supported by what he calls Dubai’s ‘traditional markets’, being Central and Northern Europe, as well as GCC nationals. As a result of the predicted occupancy increase, he adds: “I believe our RevPAR will also continue to grow and, based on the current market, we should be ahead of the curve.â€?
BITES AND BEVERAGES Existing dining concepts at Caffè Via – cafĂŠ and light snacks Le Rivage – live cooking and buffet ‘The Whistler’ – 225th storey bar Girders – British pub with a casual atmosphere Fogo Vivo – signature Brazilian grill The Deck – poolside casual dining Coral Room – exclusive for club room nd suite guests 2011 – present: Area Director of Finance and Business Support, IHG DFC
‘FRIENDLIEST HOTEL’ Reinforcing his projections, the GM reveals that YoY the hotel has generated a 6% guest return rate, of which he considers a property USP. “This is a fantastic achievement for us,â€? he says, “and is testament to the work put in by staff to achieve our reputation as the ‘friendliest hotel’ when they visit Dubai.â€? Referring to the hotel’s TripAdvisor reviews, he says: “Online feedback continuously recognises team members by name for their friendliness and for going out of their way to make guests feel welcome. Reviews do not write themselves, and within RXU ÂżUVW \HDU DFFRUGLQJ WR 7ULS$GYLVRU ratings we established ourselves as one of the top 10 hotels in Dubai.â€? The GM believes hotel hallmarks are contributing factors in the property’s positioning as “the friendliest hotelâ€? including the personalised hotel rubber ducks, of which staff handed out 24,000 last
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OCCUPANCY GROWTH, 2014
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year, in addition to a daily evening candle lighting ceremony in the lobby, where guests and children are invited to join. JA Ocean View Hotel offers 334 rooms DQG VXLWHV RYHU Ă€RRUV DOO RI ZKLFK DUH Arabian Gulf facing with balconies for viewing. .XU]HQGRUIHU FRPPHQWV Âł$ GHÂżQLWH 863 for us is our location. We’re located right at the beginning of the new ‘The Beach’ development which is Dubai’s newest dining and entertainment destination with direct access to the beach.â€? Additionally, with the launch of the Dubai Marina Tram system set for November, Kurzendorfer remarks: “We are situated with a tram station right behind our hotel, WKLV LV D EHQHÂżW WR XV /RFDWLRQ ZLVH ZH DUH very lucky, we are a 10 minutes’ walk to the metro station, and just a one minute drive from Sheik Zayed Road, the property is very
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accessible.â€? He believes the tram will allow the hotel to tap further into the corporate sector as it UXQV GLUHFWO\ LQWR PDMRU RIÂżFH GHVWLQDWLRQV such as Media City and Knowledge Village, providing convenient accessibility for business guests. At the moment, Kurzendorfer says that LWÂśV GLIÂżFXOW WR GLYLGH ZLWK SHUFHQWDJHV between leisure and business guests at the hotel, however there’s a “good mix of guests who combine both business and leisure during their stay at this hotel. “Overall the property is not a corporate hotel and practices a strict ‘no tie’ policy across its management team,â€? he adds, explaining the same leisure concept resonates, all the way from interiors to activities, which he describes as “very much cool, chilled out and a little bit funkyâ€?. Kurzendorfer explains: “Rooms are spacious and the design doesn’t follow a particular theme. They are basically universal, blank canvases suited to all preferences, making everyone feel at home and welcome.â€?There’s a big focus on guest arrival at the hotel, and last year 48,000 welcome drinks, refreshment towels and arrival snacks were served to guests.
THE WINNING FORMULA As one of the oldest hospitality companies in the UAE, Kurzendorfer surmises that JA Resorts and Hotels has built a reputation for offering a relaxed, calm, welcoming sense of hospitality, predominantly through the brand’s team focus. He notes: “At this property my staff and I pride ourselves on a service that is not imposing. We do not offer golden water taps. For us white, clean lighting and stainless-steel does the trick. “Create the right ambiance, then hire the right staff with the right training, motivation and the want to make a guest’s stay great, and you have the right formula for a successful hotel. It’s all about the team.�
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So proud is he of that team, that he UHIXVHV WR FRQÂżQH WKHP WR RIÂżFHV VD\LQJ Âł, have my staff out and about in the hotel, like myself, as I have my seat in the lobby where JXHVWV DQG VWDII DOLNH FDQ ÂżQG PH HYHU\ morning and afternoon. Over the years I have realised that if a GM shows himself in the hotel being accessible, then every other part of the hotel team becomes equally accessible,â€? he states. Further commenting that hiding in an RIÂżFH VHWV D PRUDOH RI ÂľLI P\ ERVV GRHV it so can I’, he concurs: “This role is all DERXW VHWWLQJ DQ H[DPSOH $ KRWHO LV QRW a democracy, but it doesn’t mean that we cannot implement the rules of democracy. If I don’t put my weight behind the product, no one else will, it’s a very simple equation that I learnt in China. If you don’t do it, no one else will follow.â€? When it comes to team motivation, Kurzendorfer says that he prefers taking a UHOD[HG DSSURDFK ZLWK KLV VWDII DV ORQJ DV their efforts are guest orientated. “It’s simple, I tell staff ‘you’re allowed to make a mistake, just don’t do it twice. Learn from mistakes’. No one should be too high up the food chain to carry a suitcase or FOHDU D WDEOH , GR LW DQG , H[SHFW HYHU\RQH in the hotel to do the same,â€? he says.
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GLOBAL TRAVELLER Commenting on his international H[SHULHQFH LQ WKH 6H\FKHOOHV WR 6KDQJKDL from Doha to Damascus and Nassau to 1HZ <RUN .XU]HQGRUIHU H[SUHVVHV Âł,ÂśYH seen it all too often when staff get caught up in policies and procedures, and in turn JXHVW H[SHULHQFHV DUH UXLQHG 7KDWÂśV QRW how I operate this hotel, for me itâ&#x20AC;&#x2122;s all about the guest.â&#x20AC;? Staff at the JA Ocean View Hotel are globally sourced and speak a range of languages including English, Arabic, &KLQHVH 5XVVLDQ $IULFDQ LQĂ&#x20AC;XHQFHG dialects and others. â&#x20AC;&#x153;JA was recently recognised by the authorities for having the most Emiratis working across our hotel operations. We really bring focus on employing a range of nationalities, especially locals,â&#x20AC;? he says. 5HĂ&#x20AC;HFWLQJ RQ KLV FDUHHU WR GDWH IURP HDUO\
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F&B beginnings, Kurzendorfer notes China challenged him the most, where he faced language barriers and cultural differences in 6KDQJKDL DQG RSHUDWLQJ D Ă&#x20AC;DJVKLS VHDVLGH resort in Sanya, Hainan Island. However he believes: â&#x20AC;&#x153;Everyone should actively seek a challenge at some point in their life, broaden their horizons and learn about the worldâ&#x20AC;&#x2122;s different methods of hospitality. It all adds to personality and a personâ&#x20AC;&#x2122;s make up. As hoteliers weâ&#x20AC;&#x2122;re all people that love to travel and share these H[SHULHQFHV ´ +DYLQJ H[SHULHQFHG WKH ([SR LQ Shanghai, JA Ocean Viewâ&#x20AC;&#x2122;s GM speaks RI WKH OHDG XS WR 'XEDL ([SR ZLWK enthusiasm, concluding: â&#x20AC;&#x153;By 2020 this hotel will be well established and well positioned to cater to the incoming demand. My family and I are very lucky to be here, and I look forward to being a part of whatâ&#x20AC;&#x2122;s to come.â&#x20AC;?
Otto Kurzendorfer and his on property department heads.
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ROYAL BLOOD GENERAL MANAGER GIANNI MALERBA EXPLAINS HOW THE RECENTLY OPENED ROYAL ROSE ABU DHABI IS BRINGING A TOUCH OF STAR QUALITY TO THE CITY
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hen it comes to palatial hospitality, Dubai has it covered, but in the UAE capital, the story is a little different. Although Abu Dhabi can tick boxes for breath-taking architecture and unique concepts, the grand splendour of French Royalty remained unexplored until recently. Since its soft opening on March 28, Royal Rose Hotel Abu Dhabi has been bringing a royal touch to the city. The relatively low-rise 19 storey property on Electra Street is owned by local conglomerate The Bin Ham Group and managed by City Seasons – it is the brand’s first 5-star hotel. A hotel for European aficionados, rather than Europeans, general manager Gianni Malerba predicts a debut year occupancy rate of 60% and a guest mix spanning both leisure and corporate, from established markets and key emerging markets such as China and Russia. In grand UAE style, the hotel is also a record breaker – albeit so far unofficially – as it is believed to be the tallest building with 17 th Century French Versailles style architecture.
FRENCH FANCY While other hotel brands are focused on re-defining traditional luxury or enhancing the guest experience through technology, Royal Rose focuses on merging these elements with personalised service. Reviews of the hotel to date enthuse over the manner and competency of staff and it is this, coupled with touches such as in-room iPads and what Malerba describes as a “state of the art spa”, which cement the USP. But, in operating in Abu Dhabi, Malerba knows there will be no time for complacency. One of eight 5-star hotels to open in the last 12 months, Malerba notes the increased inventory but doesn’t allow it to limit his ambition. “I was comparing the performace results from Abu Dhabi TCA and one of the interesting points is the large inventory in this class, but at the same time there has
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Far left, the hotel lobby and near left Gianni Malerba, General Manager.
Near right, the brasserie dining setup and far right, a luxury suite.
been an increase in occupancy across the city and also the revenue, which is mainly generated by 5-star hotels. “The future market demand for Abu Dhabi is rising and I’m not saying every hotel will be full, but there is an increase,” he explains, adding that growth in Dubai will also add to the drive.
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STOREY HOTEL
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SLICE OF EUROPE For the Bin Ham Group, and long term hospitality partner City Seasons, the pressure is on. While both have enjoyed success elsewhere with other ventures and hospitality products – as well as their first venture into hospitality with the 2005 opening of City Seasons Suites Abu Dhabi
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– it will be the market that decides the success of Royal Rose. As Malerba says: “We want to be among the big players in the city and I think we will play a big role in it. The property is majestic. It’s beautiful and, as our chairman explains, we want the guests to feel as though they are walking into a palace.”
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engagement and loyalty occur at certain SRLQWV RI WLPH WKH FRQWLQXLW\ EHKLQG expanding the transactions wasnâ&#x20AC;&#x2122;t always WKHUH (YHQ ZLWKLQ WKH % % SRUWIROLR ZH havenâ&#x20AC;&#x2122;t historically had a points scheme in SODFH IRU WKRVH WUDYHO SDUWQHUV RU D ZD\ WR streamline that conversation between us, as Starwood, and them. The numbers are already impressive. What is the new target?
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PROMISING PIPELINES TARGETING 50% GLOBAL GROWTH OVER THE NEXT FIVE YEARS, FRHI SENIOR VICE PRESIDENT OF OPERATIONS FOR MEAI, SAMI NASSER TELLS SOPHIE MCCARRICK HEâ&#x20AC;&#x2122;S READY TO SPEARHEAD THE GROUPâ&#x20AC;&#x2122;S AMBITION OF DOUBLING ITS REGIONAL PORTFOLIO OF 19 HOTELS BY 2020.
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urrently managing over 110 hotels JOREDOO\ XQGHU WKH )DLUPRQW 5DIĂ&#x20AC;HV DQG 6ZLVV{WHO EUDQGV )DLUPRQW 5DIĂ&#x20AC;HV +RWHOV International (FRHI) has a goal to double the FRPSDQ\ÂśV JOREDO SRUWIROLR RYHU WKH QH[W ÂżYH years. With the Middle East, Africa and India (MEAI) set to receive another 19 properties by 2020, Sami Nasser, senior vice president of operations for the region, is admittedly optimistic about the road ahead. Equipped with a fast paced work rate, quick decision making, and the backing of 8,000 colleagues â&#x20AC;&#x201C; a number of which is anticipated to increase to 11,000 throughout the pipeline roll out â&#x20AC;&#x201C; the French-Lebanese SVPâ&#x20AC;&#x2122;s main ambition now involves consolidating FRHIâ&#x20AC;&#x2122;s vision and values; LQFUHDVLQJ ÂżQDQFLDO SHUIRUPDQFHV DQG ensuring development pipelines for MEAI are implemented successfully. Since your appointment last September, what have you achieved in your role?
Since taking on the role, the team and I have made great strides in the region, including WKH ÂżQDQFLDO SHUIRUPDQFH RI RXU KRWHOV DV UHĂ&#x20AC;HFWHG E\ D KHDOWK\ DQG EDODQFHG 5HY3$5 across the wider region, with double digit growth in GOP. Moreover, we have invested in a new UHJLRQDO RIÂżFH ORFDWHG LQ 'XEDL 0HGLD &LW\
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7KH DLP RI WKLV RIÂżFH LV WR EH FORVHU WR RXU hotels and provide real time support. When , ÂżUVW MRLQHG )5+, WKH UHJLRQDO WHDP RQO\ numbered seven, within the year we recruited over 55 professionals and specialists to support our brand vision in becoming the â&#x20AC;&#x153;preferred hospitality companyâ&#x20AC;? in the region. 7KLV FRPPLWPHQW WR WKH UHJLRQDO RIÂżFH OHDGV WR DQRWKHU ODUJH SURMHFW WKDW ,ÂśP currently working on which is a new consolidated multi lingual call centre. Under your tenure, what can we expect to see moving forward?
We recently announced a robust development SLSHOLQH ZLWK JURZWK ZLWKLQ WKH QH[W ÂżYH years. The MEAI region is one of the fastest growing within the FRHI portfolio, and weâ&#x20AC;&#x2122;re well positioned to announce three landmark openings next year. 7KHVH ZLOO LQFOXGH )DLUPRQW $MPDQ DQG )DLUPRQW )XMDLUDK LQ WKH 8QLWHG $UDE Emirates and Fairmont Riyadh, Business Gate, the latter of which complements our WKUHH RSHUDWLQJ WUL EUDQGHG )DLUPRQW 5DIĂ&#x20AC;HV SwissĂ´tel) properties in Makkah, and sets the framework for future developments in KSA. Things happen so quickly in this region from hotel management agreements being signed, design and construction coming on board, to opening and integrating hotels.
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OPERATIONS
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OPERATIONS
You need to stay ahead, especially with such ambitious growth plans. Also, the hotel opening and integration WHDP LQ WKH 'XEDL UHJLRQDO RIÂżFH HQVXUHV WKDW all the elements to successfully open a hotel are fully in place. Considering the level of growth, what are your projections for employing more staff, specifically in this region?
Currently, 8,000 colleagues are employed throughout our 19 hotels across MEAI. :LWKLQ WKH QH[W ÂżYH \HDUV ZH DQWLFLSDWH WKLV number to increase to 11,000.
as outbound travel to the UAE has increased by 10%, making India the second top source market to Dubai after Saudi Arabia. Saudi Arabia is an extremely important market for us, and we currently have the biggest inventory in Makkah with three properties that are performing very well as they enter into their third year of operation. This is a great introduction not only into Saudi Arabia, but the entire Arab and Islamic world. With this success, Fairmont Riyadh Business Gate will open next year, followed E\ QHZ SURMHFWV LQ -HGGDK Moving forward with the brandâ&#x20AC;&#x2122;s
Which country in the Middle East holds
ambition, what challenges do you
the most potential for FRHI and why?
anticipate in your role?
, GRQÂśW WKLQN ZH FDQ FRQÂżQH WKLV UHVSRQVH WR one country only. If you look at the growth development in MEAI, great emphasis is placed on countries that have robust economies, development opportunities, infrastructure and vibrant heritage and culture. $V VXFK ZHÂśYH HQMR\HG D ORW RI VXFFHVV LQ Egypt with three operating properties that have led the way for an ambitious multi hotel SURMHFW LQ 6KDUP (O 6KHLNK ZLWK RYHU hotel rooms across three brands (Fairmont, 5DIĂ&#x20AC;HV 6ZLVV{WHO :KLOH LWÂśV EHHQ D challenging time in Egypt, we are committed to the long term potential of the market, as HYLGHQFHG E\ WKLV H[FLWLQJ QHZ SURMHFW ZKLFK will be completed within the next few years. UAE continues to be a key driver for FRHI JURZWK KDYLQJ ÂżUVW ODXQFKHG WKH )DLUPRQW brand in the region over 12 years ago. In addition to four operating hotels in the UAE, and two Fairmont hotels to debut next year in $MPDQ DQG )XMDLUDK ZH SODQ RQ LQWURGXFLQJ WKH 6ZLVV{WHO EUDQG IRU WKH ÂżUVW WLPH LQ WKH UAE with SwissĂ´tel Jaddaf. India remains as a strategic market for FRHI, and with operating hotels â&#x20AC;&#x201C; Fairmont Jaipur and SwissĂ´tel Kolkata. We anticipate continued growth there as we explore further opportunities with the right owners within the country. Moreover, the Indian travel market is one in which we are deeply invested in,
Challenges come from external factors. The lingering effects of the Arab spring have had a tremendous effect on travel patterns in the Middle East, and we work closely with our properties to help mitigate these risks. In line with our ambitious growth plans come recruitment and the sheer volume of personnel required to help open our hotels. With a global network of 110 hotels, we overcome this challenge by hiring from within, especially for many of our leadership roles, combined with an aggressive hiring policy that focuses on talent and passion for the industry.
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To ensure success, what are the main things your GMs drive forward in their properties?
There are several areas that a general manager should drive, most importantly they should be a true ambassador of the brand, and showcase the brandâ&#x20AC;&#x2122;s values to the guest at every opportunity. It also means playing an active role in colleague development and leadership training, launching robust food and beverage FRQFHSWV WR GHOLYHULQJ VWURQJ ÂżQDQFLDO results. Today, owner relations is an increasingly important area which requires a JHQHUDO PDQDJHU WR EXLOG WUXVW DQG FRQÂżGHQFH with the owner and/or asset manager.
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OPERATIONS
Left clock wise: Raffles, Mecca, Saudia Arabia, Fairmont, Amman, Jordan, Fairmont, Abu Dhabi, Bab Al Bahr and Raffles, Dubai, UAE.
FRHI TODAY, MEAI REGION t 14 Fairmont hotels t 2 SwissĂ´tel branded properties t 67 Fairmont hotels worldwide, notably Makkah Clock Royal Tower, The Plaza New York and Londonâ&#x20AC;&#x2122;s The Savoy. t 10 Raffles properties in the global portfolio from the flagship Raffles Singapore, to the Le Royal Monceau, Raffles Paris, Raffles Praslin Seychelles and the recently debuted Raffles Istanbul
â&#x20AC;&#x153;SINCE TAKING ON THE ROLE, THE TEAM AND I HAVE MADE GREAT STRIDES IN THE REGION, INCLUDING THE FINANCIAL PERFORMANCE OF OUR 19 HOTELSâ&#x20AC;?
With competitive F&B concepts, do standalone outlets work best, or will there be more focus on the development of signature restaurants in future?
F&B for our brands in the Middle East accounts for approximately 50% of our overall revenues. It is an important driver for increased patronage and repeated visits to our hotels, and an area we place a lot of emphasis on. At the regional level, our director of food and beverage works with every hotel F&B department to ensure their current restaurant portfolio is relevant, especially with such dramatic shifts in demographics and consumer trends in this region. Our approach in this area is not only concept driven, but DOVR LGHQWLÂżHV DQG GHYHORSV VWURQJ OHDGHUV pushes for inspiration and creativity, and creates awareness with appropriate marketing and PR campaigns. I believe this approach is what sets us apart from stand alone and celebrity driven restaurants. What is your main goal for FRHI?
0\ PDLQ REMHFWLYH LV WR FRQVROLGDWH )5+,ÂśV vision and values, while increasing the ÂżQDQFLDO SHUIRUPDQFH RI RXU KRWHOV DV ZHOO DV RYHUVHHLQJ SURMHFW UROORXWV DQG QHZ SURSHUWLHV developments.
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HoD PROFILE
MONEY MATTERS AREA DIRECTOR OF FINANCE FOR INTERCONTINENTAL HOTELS GROUP DUBAI FESTIVAL CITY, RAFIQ AHMED, TALKS CLIMBING THE CAREER LADDER, RESPONSIBILITY PRESSURES AND AWARDS PROFILE Name: Rafiq Ahmed Job title: Area director of finance and
T
ell me about your career progression up to this point…
When my career began as an accounts receivable supervisor I never imagined that I’d one day take up this role, however it was possible with hard work and support from IHG, which recognises talent in its employees. My career really kick-started when I was chosen as employee of the year during my third year of service, which saw me move from being a supervisor to finance manager, followed by director of finance and now where I am today. What has been the highlight of your career to date and what were your most exciting moments?
Overall my career has been very exciting and fulfilling, but the highlight to date was when my team and I achieved an ‘excellent’ audit rating for the third consecutive year. Additionally, I received the Global Finance Award of financial controller of the year in 2008, followed by finance leader of the year in 2011, these have been my most exciting moments. However, the year 2014 has been the best year of my career so far. This year I have received three prestigious awards in Osaka, Japan and two awards in Abu Dhabi, with the major ones being best area
62
director of finance and business AMEA, best audit rating AMEA and best auditor AMEA.
business support for InterContinental Hotels Group Dubai Festival City (IHG DFC) Time on property: 3 years
What’s the greatest challenge you face
Time in industry: 20 years
day to day in your role?
Managing the finance department and supporting operations through responsible business practices is my greatest challenge, especially when dealing with finances. At IHG, the notion of acting responsibly is at the heart of everything we do, so there is great pressure to ensure that things are done in the right way and that our staff, including myself, are thinking long term so that we conduct our business in ways that are mutually beneficial for the brand, our stakeholders, clients and guests.
Career to date: 1993 – 1996: Accounts receivable supervisor and acting credit manager 1997 – 1998: Financial accountant 1998 – 2003: Assistant financial controller / credit manager 2003 – 2006: Financial controller, Intercontinental Resort Al Ain 2006 – 2009: Director of finance and business support, Intercontinental Abu Dhabi 2009 – 2010: Area director of finance and business support, Intercontinental
Looking to the wider industry: How can
Abu Dhabi and Al Ain
the role of area director of finance be
2010 – 2011: Director of finance and
developed further to enhance the hotel
business support, Intercontinental
performance?
Abu Dhabi
As it stands the role involves a complete focus on finance and all finance related matters at the property, however when the role is widened to extend business support and guidance throughout all departments in the hotel, this can further enhance the overall hotel performance, especially when working in a group comprising of
2011 – present: Area director of finance and business support, IHG DFC
InterContinental, Al Badia Golf Club by InterContinental, InterContinental Residence Suites and Crowne Plaza Dubai Festival City.
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The largest business awards in the GCC 30th November, Dubai
Stars of Business has become an iconic awards brand like no other in the r egion. It recognizes the very best SMEs across 26 business categories. Itâ&#x20AC;&#x2122;s universally respected as scientifically assessed and unimpeachably judged. 327,000 SMEs across the UAE $234 billion estimated total revenue of the SME sector 4,974 Awards entries in 2013 1,856 Individual company applicants
nominate now at www.starsofbusinessawards.com
Presenting Partner
Strategic SME Partner
Knowledge Partner
Official Publication
Organiser/Publisher
ANALYSIS
ASCENDING GULF VACANCIES HOSPITALITY VACANCIES IN THE GULF DURING H2 2013 MORE THAN TRIPLED FROM 18,000 IN 2009 TO 61,000 LAST YEAR REFLECTING THE REGION’S GROWING ECONOMY, REVEALS THE LATEST HOSPITALITY EMPLOYMENT RESEARCH FROM CATERERGLOBAL.COM SOPHIE MCCARRICK ANALYSES THE DATA
U
sing data from over 150,000 active jobseekers in the Gulf Arab states of Bahrain, Iraq, Kuwait, Oman, Qatar, Saudi Arabia and United Arab Emirates, Catererglobal.com’s most recent bi-annual Hospitality Employment Index (HEI) reports that job vacancies increased by over 25% from 2012 to H2 2013. “The fastest growing economies in the region have been Qatar, Saudi Arabia and
the UAE with the latter taking a significant lead in terms of hospitality job vacancies,” says Pete Willis, director Middle East, Catererglobal.com. During the second half of last year, the report found the number of applications per vacancy had risen significantly across most parts of the industry, particularly in management posts, of which vacancies remained ‘relatively steady’ for.
However, the number of nonmanagement posts increased by 32% during H2 2013, particularly in front office and housekeeping vacancies. “Less people actually applied for housekeeping jobs than in 2012, suggesting that the internal market is saturated and that employers needs to source from outside of the region. Also, our report shows that salaries in the region
EXECUTIVE SUMMARY: THE EMPLOYER’S MARKET Job advertised YOY (2012 vs 2013)
The UAE posted the most vacancies but
Apps per job 6 months (2013 Q4)
also attracted the most applications
KUWAIT
per job, making the UAE an employer’s
14%
markets with 100 applications per management job and 75 for each non-
40
YOY APPLICATIONS PER JOB
management job.
IRAQ
BAHRAIN
165%
100
YOY APPLICATIONS PER JOB
79%
55
SAUDI ARABIA
QATAR
23%
30
YOY APPLICATIONS PER JOB
OMAN
22%
50
45
64
YOY APPLICATIONS PER JOB
UNITED ARAB EMIRATES
49%
YOY APPLICATIONS PER JOB
YOY APPLICATIONS PER JOB
100
39% YOY APPLICATIONS PER JOB
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ANALYSIS
KEY FINDINGS
WHY I CHOOSE THE GULF FOR EMPLOYMENT…
37% 55% 74% 32%
YOY INCREASE OF FRONT OFFICE VACANCIES BETWEEN 2012 AND 2013
OF WESTERNERS AT MANAGERLEVEL OUTSIDE OF THE GULF WOULD MOVE TO THE REGION
OF NONWESTERNERS ARE HAPPY TO RELOCATE TO THE REGION
YOY INCREASE IN NONMANAGEMENT POSTS IN H2 2013 FROM THE YEAR PREVIOUS
Frantz Mathis, director of F&B, The One and Only Royal Mirage: “Although I considered other expat destinations, there were more opportunities here. The first year here can be very difficult for some, however I think recruiters are now becoming less selective than they were.” Stuart Thomson, regional director of human resources, Middle East, Starwood Hotels and Resorts: “The explosive growth in the industry combined with the high standards of hotels made this
20% 70% 91% 76 %
GROWTH IN HOSPITALITY VACANCIES FROM 2012 TO 2013
OF ALL GULF VACANCIES WERE UAE-BASED IN H2 2013
YOY GROWTH OF HOUSEKEEPING VACANCIES BETWEEN 2012 AND 2013
OF AVAILABLE POSTS AT 2013 END WERE NONMANAGEMENT ROLES, A RISE OF 32% YOY FROM 2012
region a very interesting location for me to explore and grow my career. For my position, I was head hunted and went through an interview process.” Rudolf Segers, executive chef, Waldorf Astoria Ras Al Khaimah: “In places like Dubai, Abu Dhabi and Doha a clear platform is provided for people to challenge convention, which was a great attraction for me. I feel chefs here challenge themselves in many ways that they perhaps couldn’t do in Europe.”
“HR MANAGERS ARE NOW STRUGGLING TO FILL MANY POSITIONS WITH QUALITY CANDIDATES” are not competitive compared to those outside of the Gulf, this is an issue that may need addressing if regional employers are to compete on a global basis,” Willis continued to explain. The influx of vacancies has created a ‘suitable candidate’ drought, Willis comments: “Despite overall application
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numbers for such posts rising, the supplyside has been unable to meet demand. HR managers are now struggling to fill many positions with quality candidates that have the required skills,” He explains that whilst more jobs in a growing economy is self-evident, it brings new challenges for businesses seeking
talented employees at every level of seniority. Increased employment activity comes at a time where Dubai is on the hunt for talent in line with winning the World Expo 2020 and the government’s major infrastructure development plans. The director notes: “With similar growth models being rolled out in Qatar and Bahrain, it looks certain that there’s to be a regional fight for the best people to recruit.” Willis concludes that H2 2013 saw a major step-change in activity, however also revealed real weaknesses on the supply side, with the challenge now to find excellency in candidates.
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ANALYSIS
NEW KID ON THE BLOCK SINCE AUGUST 2008, AIRBNB HAS GROWN FROM A SAN FRANCISCO START UP TO A GLOBAL COMPANY WORTH $10BN, AND TODAY INCLUDES THOUSANDS OF DUBAI LISTINGS. BUT WITH SUBLETTING DECLARED ILLEGAL IN THE EMIRATE AND THE ANNOUNCEMENT OF DECREE 41, WILL ITS MISSION TO RESHAPE THE TRAVEL INDUSTRY, SUCCEED IN THE UAE? SOPHIE MCCARRICK INVESTIGATES
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ANALYSIS
R
ecent developments in the holiday homes sector have spurred the evolution of online platforms that not only allow travellers to book accommodation, but also interact with each other. Taking this one step further, travellers can now even book each other’s homes, instead of hotels. Whilst the global practice of letting and subletting properties is nothing new, webbased portals facilitating this are creating a stir within certain short-term leasing markets, changing the ways in which travellers source their lodgings and making the UAE-declared illegal act of subletting, easier than ever. Since 2008, the California-based property service AirBnB has developed itself as an online community and marketplace in more than 34,000 cities and 190 counties, including the UAE. Founded by three friends, AirBnB is now valued at $10bn and generates its main source of revenue through a 3% charge on all rentals made via the portal. Connecting users, the site currently offers more than 800,000 listings worldwide, and has housed over 17 million guests since its founding. As it stands, over 1,000 listings are Dubai-based properties, inviting travellers to visit the city for as little as $10 for a bed per night, and up to $272 per night for a premium apartment on The Palm. Dubai’s ADR stands around $185. The online gateway allows home owners, sub-letters and holiday home companies alike to let out anything from an entire home, to a private room or a single bed in a shared dorm; all options of which are available on Dubai’s listings, predominantly in areas of prime real estate such as Dubai Marina, The Palm Jumeirah and Bur Dubai. Following in the footsteps of sites such as TripAdvisor, AirBnB also enables users to leave public feedback on their stay and communicate directly with the person letting the property prior to their trip; a level of transparency that allows listings to stand or fall on their peer review ratings. AirBnB has publically admitted that
34,000+ CITIES USE THE SITE
THE PROS
THE CONS
Travellers can save money visiting high-
Personal information may fall into the
cost destinations
wrong hands if wrong host is chosen
Reviews can help ensure that a holiday
Ads and descriptions may be misleading
home’s true identity is revealed In many places, short-term rentals are Non-traditional accommodation is
illegal, leaving guests in a vulnerable
available, providing options to suit
position
personal needs Tenants subletting units without written Advanced search options allow guests to
permission from their landlord can face
personalise their lodgings
eviction
Friendships can be formed between host
Rental accommodation may not be
and guest
secure or offer safety services
there are ‘bad actors’ in the system, and that it continually tries to weed them out, estimating that 87% of listings are in good faith, while other statistics suggest that professional landlords are abusing the platform and are responsible for as many as 30% of all listings.
those local residents subletting their homes or rooms could now be liable. In June this year, the Department of Tourism and Commerce Marketing (DTCM) announced that owners wishing to add their properties to Dubai’s shortterm rental offering would have to apply for a licence to do so. A holiday home, according to the authority, is classified as any furnished accommodation that is rented as a whole unit on a daily, weekly, monthly or annual basis without the issuance of an EJARI
SNAGS IN THE SYSTEM With Dubai’s ADR among the highest in the world, it comes as no surprise that bargain-seeking travellers explore alternative accommodations. However,
67
ANALYSIS
regulated tenancy agreement and should be registered with DTCM. Following His Highness Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice President and Prime Minister and Ruler of Dubai’s issuing of Decree No.41 of 2013, concerning the regulation of the holiday homes market, as of June 15 2014 the operating of residential properties for use as holiday homes was restricted to licensed operators only. “Through regulating the use of properties as holiday accommodation, the objective is to broaden the range of options available to visitors, while ensuring that the high standards of quality for which Dubai is known, are maintained,” comments Khalid bin Touq, executive director of licensing and classification, for DTCM. He adds that the decree will allow tourists to know that they are in a safe environment, with the knowledge that the property is both insured and managed by a qualified party. Although DTCM has revealed plans to regulate short-term rentals, the government still has yet to release detailed regulations. Prior to the issuing of the decree, no law existed to govern the regulation of shortterm holiday rentals in Dubai, despite the law stating that property subletting in the emirate is illegal. Imran Latif, director at My Stay Group, says: “As users of the AirBnB site ourselves, we applied for the license when DTCM’s announcement was made. The holiday home sector in Dubai certainly needs to be regulated in order to maintain a level playing field. There are many hosts on the site that are unlicensed and even sub-letting rooms within their properties, which is unfair to those working to play by the rules.” He adds: “We must ensure the holiday home sector is steered to operate with the same professional hospitality standards as hotels in Dubai, especially from a safety and security point of view. Those subletting without any experience are not adequately equipped to deal with all the
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17m+ AIRBNB GUESTS WORLDWIDE
1,000 AIRBNB LISTINGS ARE DUBAI-BASED
possible eventualities. Our experiences over the past 10 years show that many things can go wrong when renting holiday homes for short stays. Individual home owners currently opting for the do-ityourself route cannot offer the full time 24/7 support, which is so absolutely necessary.” Dubai is not alone in its stand against the sub-letting of property; the conflict over short-term rentals has escalated in other cities around the world such as Berlin, Panama City and Madrid, where government agencies have made moves in recent months to regulate the industry. Earlier this year in Barcelona authorities fined AirBnB $40,200 (AED 147,500) for breaching local laws, which state that units
rented to tourists must be registered, of which the site does not include mention, therefore misleading travellers.
A THREAT TO HOTELS? With Dubai’s hotel inventory on the rise, another issue created by the site involves the competition it generates for local hotels. Rob Collier, general manager, Radisson Blu Residence Dubai Marina, comments: “As hoteliers it is critical that we reflect on new competition entering the market, whether it be from traditional angles or from new diverse entries. We should consider the possible impact DTCM’s decree may have within the leisure market, however I believe our corporate guests
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ANALYSIS
FIRST-HAND EXPERIENCE
$10 bn IS THE CURRENT VALUE OF AIRBNB
800,000+ ACCOMMODATION LISTINGS WORLDWIDE
will still demand the levels of service and comfort that international branded hotels and residences can offer.â&#x20AC;? With a positive outlook, Enad Tannous, general manager at Amwaj Rotana Jumeirah Beach Residence says that a trend such as AirBnB will no doubt contribute to his propertyâ&#x20AC;&#x2122;s F&B business if it is to further grow in the locality. â&#x20AC;&#x153;The occupancy and arrivals rate into the area has been well sustained over the recent periods despite the subletting of apartments through AirBnB. If anything, it has brought more people into the area and we have seen an increase in the number of visitors to the surrounding attractions, including our F&B offering,â&#x20AC;? he explains. He adds: â&#x20AC;&#x153;Guests are fully aware of the
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difference between a hotel and staying in someoneâ&#x20AC;&#x2122;s apartment and those are two different markets. Those who favour hotels will always book hotels.â&#x20AC;? Offering a different take on the platformâ&#x20AC;&#x2122;s potential, a spokesperson from Ramada Plaza Jumeirah Beach Residence, comments: â&#x20AC;&#x153;Generally, I think people feel more comfortable staying in homely atmospheres; however when it comes to the issue of health and safety, subletting of properties through outlets such as AirBnB can be an issue.â&#x20AC;? Requesting anonymity, the spokesperson adds: â&#x20AC;&#x153;I do see AirBnB and platforms alike as a small threat, however, they will never be able to compete with the services available in a hotel.â&#x20AC;?
Direct conversations with Dubai AirBnB users, many of whom requested to remain anonymous, revealed they do not see themselves as competition to the local hotel industry. A member of the site since 2012, one Dubai Marina based resident comments: â&#x20AC;&#x153;I do not feel like Iâ&#x20AC;&#x2122;m competition to hotels as I donâ&#x20AC;&#x2122;t offer services available at 4- or 5-star properties. However, I have received a lot of demand from travellers visiting Dubai alone or as a couple and who are looking to stay in a nice area, at a cheaper cost than in a nearby hotel.â&#x20AC;? She explains that she began using the service to sublet the second bedroom in her DSDUWPHQW DIWHU KHU Ă&#x20AC;DWPDWH PRYHG RXW â&#x20AC;&#x153;Marina rent prices are expensive and I simply began using AirBnB to subsidise the cost of renting a two bedroom apartment, which is now affordable because of the site. I think the platform really helps a lot of peopleâ&#x20AC;? she says. Another user contacted, known as Walid discloses that his account is used by a group of property investors who have been utilising the service for one year. â&#x20AC;&#x153;Using AirBnB so far has been a very good experience and I donâ&#x20AC;&#x2122;t feel there are any legal issues relating to the site following DTCMâ&#x20AC;&#x2122;s holiday home licensing announcement. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s quite simple, all operators active in this area are required to get a license, and itâ&#x20AC;&#x2122;s those who do not that ruin the opportunity to make contacts through the site for the rest of us,â&#x20AC;? he states, adding: â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s a great alternative from hotels, allowing travellers to stay in Dubai longer than they would if they were paying hotel rates.â&#x20AC;? With experts predicting that those disobeying the law could be liable of fines up to $27,225 if not licensed, it is expected that perhaps when fines start being issued sub-letters in the area who rent without their landlordâ&#x20AC;&#x2122;s permission, may start re-thinking their usage of sites such as AirBnB.
69
ANALYSIS
Mobile kitchen production and the mobile kitchen counters on site.
70
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ANALYSIS
SOPHIE MCCARRICK GOES BEHIND THE SCENES AT DU ARENA YAS ISLAND TO FIND OUT HOW ONE CATERER FEEDS 60,000 GUESTS AT A TIME
F
or the concert-goers amongst us, it’s likely we’ve all indulged in a late night snack at some point in time. However, in all its convenience, have you ever wondered what culinary planning and preparation goes on behind the scenes, when catering to so many people in such a small time period? With full catering rights to the Du Arena located on Abu Dhabi’s Yas Island, Royal Catering offers one of the largest central kitchens in the UAE, as well as a fleet of mobile kitchens that can each cater to 5,000 people. The facilities are used to
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meet the needs of everything from mega events such as concerts, to fine dining and facilities management. Known for its catering partnership with sporting events such as Formula 1 Abu Dhabi Grand Prix, the team of over 1,700 chefs and service staff is well accustomed to providing food to the equivalent population of a small town. So, where does all the preparation for such a large operation begin? Royal Catering’s executive sous chef, Fadi Hamdouchi, explains: “The process of catering to such a large event begins for
us when we receive the order from Flash Entertainment, months before the concert. They inform us of the total estimated amount of people, set-up of the event and what the event will be for. “We then work out the needs of the audience, from catering to event staff, VIP clientele and general audience. “Our chefs then place all necessary food orders, which mainly consist of fresh produce from within the UAE, including all our meat,” he adds. Hamdouchi explains that Royal Catering has two onsite kitchens at Du Arena, where
71
ANALYSIS
all food is cooked fresh. But while the scale of catering is one issue, the strict hygiene standards that apply to such events come with their own challenges. “By law we work under strict hygiene standards. Hygiene is of great importance to us and it’s a huge responsibility when catering to a minimum of 10,000 people,” he says. As per regulations, items such as burgers must be freshly sourced and oven cooked at 180 degrees Celsius for a minimum of 15 minutes. Amidst large groups of people it’s also necessary for Royal Catering to consider vegetarian requirements and special requests of VIP guests, who are able WR SUH RUGHU VSHFL¿F PHDOV SULRU WR HYHQWV
MINIMISING WASTE Despite a crowd of hungry mouths, the
LAST YEAR, ROYAL CATERING… t Served 2,435 tonnes of rice t Sold 10.8 tonnes of French-fries t Cooked 438 tonnes of lamb t Dished up 1,920 tonnes of poultry t D uring 2013 Abu Dhabi Formula 1 Grand Prix, Royal Catering… t Sold 60,926 burgers t Served 7 tonnes of chicken shawarma t P repared 2.4 tonnes of French fries, served over 72 hours
question of food wastage at large-scale events lingers. In response, Malwan Kisadela, assistant banquet manager for Royal Catering explains: “We really try to plan efficiently to minimise waste as much
Inside the Royal Catering mobile kitchen.
14%
INCREASE IN HOTEL OCCUPANCY ON YAS ISLAND SINCE 2013
72
$21.7 m
INVESTED IN FACILITIES AND STAFF
40%
INCREASE IN REVENUES 2013
as possible. Obviously we do not want to run out, but we also don’t want to see a lot left over. “Based on the expected figures provided, we supply an extra 5% for the ‘just incase’ demand. As everything is cooked fresh, food that has not been cooked can then be sent back to suppliers and used elsewhere. Waste would also hinder our profit margins if we massively over supplied,” he adds. The key to avoiding wastage at largescale events is to only remove food from its original packaging when needed and ensure controlled production during the final stages of preparation, notes Samer Simreen, general manager, commercial at Royal Catering. He says: “With our experience in estimation and thorough planning before the event, we are able to keep food wastage down to an absolute minimum.”
THE BIG DAY Now in the planning stages for the 2014 Formula 1 Etihad Airways Abu Dhabi Grand Prix, which will take place on November 21 – 23, Royal Catering is expecting to cater to approximately 60,000 people over the three day event, a 50% increase on the same event last year. Catering to the demand, the company will have a team of 900 staff working at the event, equipped with a range of facilities on site, including nine mobile kitchens, 30 concessioner kiosks, 12 snack bars, three club seating areas offering Italian, French and Mexican concepts, four ‘special’ dining areas and four beverage tents, as well as the Royal Catering central production unit facilities for preparation. Simreen explains that besides from bearing in mind the number of people in attendance, they also have to take into consideration the Formula 1 operation hours of 8.00am until 8.00pm, to estimate the amount of food required. “Everything is calculated based on the SUHYLRXV \HDU¶V QXPEHUV DQG ¿JXUHV ZLWK a spare of 20% at all times. Since this is Royal Catering’s third consecutive year
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ANALYSIS
F1 ABU DHABI GRAND PRIX 2014
A typical preevent team briefing.
t 9 00 staff t 9 mobile kitchen t 3 0 concession kiosks t 1 2 snack bars t 3 club seating areas offering an Italian, French and Mexican concept t 4 ‘special’ dining areas t 4 beverage tents
catering for the F1, the production team KDV GDWD DQG ¿JXUHV LQ SODFH IRU DQ DFFXUDWH estimation this year,” he says. He adds: “Keeping food wastage down to the bare minimum is always of utmost importance. We have a return policy with all our suppliers for raw food. Which
means that anything that has not been taken out of the original packaging is then returned or used at our three residential complexes in Ruwais where we also do mass catering.” Reflecting on 2013, Royal Catering recorded a 40% increase in revenue across
its businesses and invested $21.7m in its facilities and people. Now, with F1 demand rising and occupancy at Yas Island reaching 84% in H1 2014, when compared to approximately 70% last year, Simreen notes that there’s bigger catering operations yet to come.
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BRANDED VS UNBRANDED RESIDENCES FILIPPO SONA, HEAD OF HOTELS AT COLLIERS INTERNATIONAL, EXPLAINS WHY ‘LOCATION, LOCATION, LOCATION’ IS SLOWLY BECOMING ‘BRAND, BRAND BRAND’
T
he world of hotel development is changing. The old truism of “location, location, location” can no longer be looked on in isolation but must be combined with “brand, brand, brand” in order to succeed in today’s hotel development landscape. This paradigm shift is occurring as a result of the unprecedented growth of hotel companies’ portfolios, loyalty programme members, the use of social media to market hotels and above all the coming of age of the brand-conscious Gen Y. The dilemma about the benefits of branded versus unbranded hotels is a question I am often asked, particularly for markets such as Mecca, where other market forces are at work. Brand affiliation in Mecca is perceived not to add value to the bottom line as the volume of pilgrims is dependent on the visa quotas issued by the authorities and the hotel business mostly booked via tour operators. This is not a static construct as Colliers has seen evidence, over ten years presence in Saudi Arabia, that branded hotels are able to leverage their distribution systems and marketing channels to maximise their occupancy and market share particularly during periods of low demand, where the demand from tour operators is less desirable. For those who have witnessed the effect of the global economic downturn on the global hotel industry can acknowledge, this evidence is also proper for any other market, suggesting the benefits of brand hotel affiliation should be looked at together with market conditions and the economic cycle of the market. While branded hotels are faced with various payments attributable to the brand, such as royalty payments and other management fees, those fees do
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FILIPPO SONA HEAD OF HOTELS AT COLLIERS INTERNATIONAL
“THIS EVIDENCE IS ALSO PROPER FOR ANY OTHER MARKET, SUGGESTING THE BENEFITS OF BRAND HOTEL AFFILIATION SHOULD BE LOOKED AT TOGETHER WITH MARKET CONDITIONS AND THE ECONOMIC CYCLE OF THE MARKET”
not have deleterious effect on the net operating income (NOI) compared to NOI for independent hotels, suggesting that independent hotels are unable to bring their ADR and RevPar premiums to the bottom line despite their savings in management expenses. One explanation could be that branded hotels, as part of an umbrella of brands, may share resources enabling them to realise economies of scale and superior cost control compared to independent hotels. Hotel brands are expected to add value to individual hotel properties due to the strength of their global distribution systems, loyalty programmes and brand recognition; all resulting in a relatively
higher operating volume for the individual hotels affiliated with the brand. For the consumer and for prospective employees, a brand is a perceptual construct - it exists in people’s heads and in the hotel business is a proxy for service and quality level. A hotel brand is a means of identification and differentiation; an assurance of the delivery of known product/service benefits. Above all else it communicates a promise. A hotel brand name is part of the process of giving tangibility to what is essentially intangible; providing a “shorthand” method of establishing a particular property’s quality by giving the customer important information about its product and service, sight unseen. Within the Middle East, the difficulty of recruiting seems less of an issue within branded hotels as they offer a variety of training programmes, company benefits and above all an opportunity to build a career allowing employees to travel and see the world whilst working – opportunity inexistent within an independent property. Through the 38,000 keys of real estate valuations carried out by the Colliers International hotel team, it has been learnt that brand affiliation, good physical asset maintenance, and reputation for high quality service together can contribute as much as 15 to 20% of the going concern value of a stabilised operating hotel. With extensive global experience, distribution systems, marketing platforms, training programmes, sophisticated budgetary and business planning tools, branded hotels are equipped with the know how to provide investors a much less risky operation than an independent hotel.
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THE HOSPITALITY ATHLETE HARALD BUERKLE SHARES HIS EXPERIENCE OF STUDYING FOR THE GLION ONLINE MBA WHILE OPENING TWO HOTELS FOR THE 2014 SOCHI WINTER OLYMPICS
A
fter years as an executive chef and hotel manager, I decided to enroll in the Glion Online MBA programme so I could to take my knowledge and critical thinking abilities to the next level. Soon after enrolling in February 2011 however, I was offered an incredible job opportunity: To open two hotels near Sochi before the 2014 Winter Olympics. After a short conversation with my wife, I said of course, yes. But I didn’t think about the fact that I had also signed up for the Glion Online MBA programme. Dropping out would be like an athlete who would quit his or her participation due to adversities that are solvable. I like to be challenged and I strongly believe that with commitment and a focus on time management, everything is possible to achieve. My wife and I arrived in Rosa Khutor in August 2011, the mountain cluster where all the Olympic ski events would take place, a 40-minute ride from the Olympic Stadium in Sochi. I immediately embarked on the MBA, while serving as GM of The Park Inn by Radisson Rosa Khutor, a four-star hotel with 211 rooms, and the Radisson Hotel, Rosa Khutor, a five-star hotel with 181 rooms. I had worked with Radisson since 2005, and was part of the opening team as executive chef for Radisson SAS Hotel Kiev in Ukraine. Before that, I worked with Kempinski for nine years, including one year in Moscow. My deadline for opening the Park Inn was six months after arrival, in time for the resort to host the Alpine Ski World Cup in January 2012. I knew that to open in such a short timeframe would not be easy, because the entire destination of Rosa Khutor was being built from scratch.
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BURNING THE MIDNIGHT OIL
HARALD BUERKLE GENERAL MANAGER AND ONLINE MBA STUDENT
“WE HAD SO MUCH SNOW THAT WINTER THAT THE ENTIRE RESORT LOOKED COMPLETELY READY, BUT WHEN THE SNOW MELTED, WE WERE BACK TO REALITY— THERE WAS STILL A LOT OF CONSTRUCTION NEEDED FOR THE OLYMPICS”
The Park Inn was just a shell with no pipework or electricity; the basement concrete had not yet been poured. In Russia, supply is very fragile and getting operating equipment in time is a big challenge. Everything has to be documented with special papers and stamped and signed five times. We had so much snow that winter that the entire resort looked completely ready, but when the snow melted, we were back to reality—there was still a lot of construction needed for the Olympics. The Park Inn opened just three days before the World Cup.
In the meantime, I was studying evenings and weekends, with a schedule as tough as that of the hotels. Delegating a lot of tasks inside the organisation made it possible for me to do both at the same time — developing trust in the people, and using the time wisely. With the Online MBA, you have class postings and clear deadlines with your assignments — three, four, five each week. So you can’t fall behind. I always downloaded the material two days ahead of schedule. But I still went to the swimming pool. I took my iPad and did my readings and enjoyed life a little bit. But that was far from the end of the problems. The second hotel opened in January 2013 to host the pre-Olympic test events, but its opening was delayed two days when the basement flooded due to a sewer line blocked by construction dust from other hotels. Soon after the opening, the hotel’s main power line was cut by a crane working down the road, so it had to run on the emergency generator. We had to use bottled water several times when the water was shut off. Despite the teething problems, I was disappointed to see how negative the global media portrayed Sochi and the Winter Games, especially considering how proud the people were to have it.
ANOTHER CHALLENGE: RECRUITING Inside the hotels we faced more challenges – this time, finding skilled English speaking hoteliers to work in the properties. We had to recruit from Siberia to St. Petersburg because hiring foreigners was
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not an option, due to visa restrictions. We managed to get more than 200 employees on board for the first opening and I had planned to put half those trained employees into the second hotel and then fill up both properties with newcomers. But when competing companies built several hotels at another resort five kilometres away, everybody started to come shopping in the mountains for trained employees and many were lured away. Now with our competitors, we have an agreement that we do not recruit anymore from each other—or if we do, we go
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through the HR department. So we don’t all waste our resources and time stealing from each other, which doesn’t make sense in the end.
DISSERTATION: THE FINANCIAL EFFECTS OF THE GAMES My dissertation on the financial effects of hosting the Winter Olympics on hotels and destinations was submitted two months early so I could focus on preparing for the Games. In the piece, I compared Vancouver (which hosted the 2010 games) to Bern,
which withdrew its bid for those games, and I found that although Vancouver hotels’ average rates were higher during the games, they were lower in the preceding months… and higher the following summer due to increased conference business. It demonstrated that the games’ financial benefits to hotels is very limited — more important is the PR effect on the entire destination. The phenomenon has repeated in Rosa Khutor today, with a high demand from skiiers and corporate conferences post-Olympics.
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IRAN’S CHARM OFFENSIVE AN OVERVIEW OF THE TOURISM INDUSTRY AND REGULATION IN IRAN
A
s Iran takes steps to reintegrate internationally, tourism is emerging as a key driver for improved global relations. The current government has announced concrete plans, policies, and strategies aimed at promoting Iran’s tourism potential and exploiting the host of opportunities that it can offer for further economic development. Iran ranks 98 th among 140 countries on the Travel and Tourism Competitiveness Index (TTCI) 2013; significant progress compared to 2011, when it ranked 114 th. Notably, Iran ranks high on the price competitiveness pillar of TTCI, which is correlated with low fuel costs and low ticket taxes and airport charges. Additionally, Iran scored highly for cultural resources and quality of natural environment. This is no surprise for a country with 17 UNESCO World Heritage Sites, diverse climate zones, topography and an ancient history that stretches from the beginnings of civilisation. Such potential underpins the latest developments in tourism. The cultural and historical legacy of Iran is unrivalled dating back over 10,000 years ago. The country is home to major archaeological monuments from various periods of the history. The ancient Achaemenid ruins of Persepolis and Nagsh-e-Rostam near Shiraz in the South, Zoroastrian sites in Yazd, glorious mosques and bazaars of Isfahan are included in UNESCO World Heritage List. Iran attracts a large number of religious tourists because of the holy sites in Qom and Mashad which bring visitors mainly from Iraq, Pakistan, Afghanistan, Lebanon, and Bahrain. According to official reports, Mashad hosted 25 million religious tourists (including Iranians) in 2013. Iran has also been attracting a limited number of medical tourists (400,000 500,000 per year), after the opening of
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refurbishment work. More importantly, there is a shortage of comfortable budget, 3-star hotels and motels as well as lodges and rest houses throughout the country. Currently, there is no international classification system for hotel ratings.
ACCESSIBILITY: State ownership and control AMIR KORDVANI AND SARAH KHALIFA ASSOCIATES, CLYDE & CO ABU DHABI
the country’s first hospital-hotel in Tehran in March 2014. The Iranian government recently announced that it will work towards building a strong healthcare tourism sector to attract a target of 20 million medical tourists by 2025.
MAJOR CHALLENGES: Sanctions Unfavourable economic conditions have created a major challenge for the Iranian tourism industry. For instance, none of the international credit cards, such as Visa and Master Card, can be used for hotel reservation and payment in Iran. As a result, all payments must be made in cash. In addition, a number of banks in the US, UK, Canada, and Australia have put in place policies under which any bank accounts accessed from Iran will be blocked. Sanctions are therefore a major impediment to Iran’s tourism industry.
INFRASTRUCTURE: Accommodation Over the past few years, new hotels have opened in cities such as Tehran and Mashad as well as Kish Island. But despite the pipeline, most existing hotels were built prior to the revolution in 1979 and need major renovation and
Currently, state-owned enterprises operate the largest group of hotels in the country. Almost all of the state-owned hotels are operating at a loss due to inefficient management and lack of expertise. Additionally, with respect to hotels and tourist centres built prior to 1992 (which form the majority of the existing hotels), tariffs are set by the government which means that there is no competitive pressure in the hotel industry.
Training A major challenge facing the Iranian tourism industry is lack of hospitality education, that is, the skills and competencies normally expected from employees working in the sector. There are a number of hotel management and operation training institutions operating in Iran. Nonetheless, anecdotal evidence shows that employees’ attitude, skill levels, and language ability still fall short of those expected by international travellers.
Visa Tough visa requirements for certain nationalities visiting Iran are said to be among the factors strangling the tourism industry. However, according to some reports, visa requirements for travellers to Iran is under review, and citizens of most countries will soon be able to obtain visitor visas upon arrival at Iranian airports.
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REGULATORY FRAMEWORK Iran’s Cultural Heritage, Handcrafts and Tourism Organisation (ICHTO) is responsible for regulating tourism, and: t Policy making and planning for the tourism industry; t Assessing promotional plans and mechanisms for developing tourism; t Issuing licenses and supervising the administration of hotels, museums, restaurants and travel agencies and granting qualifications and rating of these establishments; and t Maintaining databases on conditions, standards, and descriptions of tourism enterprises and travel agencies.
KEY STATISTICS
The head of the ICHTO serves as one of the deputies of the President of Iran.At present, ICHTO’s key priorities include: t Improving and upgrading standards of tourism infrastructure and know-how, and hospitality services; t Encouraging and facilitating private sector participation in hospitality and tourism projects; t Working with other government organisations to facilitate and encourage tourists’ travels to Iran by the removal of bureaucratic impediments; t Improving the marketing activities for promoting Iran’s tourist attractions to the outside world; t Providing training (including through collaboration with the private sector) for employees in the hospitality sector; and t Domestic public training and education on tourism.
Official name
Persians form the majority of the population (51%). In 1935 Reza Shah requested that the international community refer to the country as Iran. Today both “Persia” and “Iran” are used interchangeably outside Iran by Iranians and non-Iranians. However, the Islamic Republic of Iran remains the official name of the country.
Membership of key conventions
Iran is a signatory to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, also known as the New York Convention. Iran also has an observer status at the World Trade Organisation.
Free Zones
Kish Island, Qeshm Island, Bandar Anzali, Maku, Chabahar, Aras FZ (in north of Iran), Arvand FZ (in Khuzestan province in southern Iran)
Foreign tourist arrivals (March – June 2014)
23,625
Average hotel stay
3.5 nights
Primary source markets
Iraq, Azerbaijan, Turkey, Afghanistan, Pakistan, Turkmenistan, Saudi Arabia, Kuwait, India, Bahrain
Main travel purposes
Religious tourism, medical tourism, business, cultural and heritage tourism, leisure and recreational tourism
Tourism share of GDP
2.2%
Main destinations for foreign tourists
Tehran, Mashad, Shiraz, Isfahan, Yazd, Kerman, Kashan
Number of hotels
1,100
Taxation
50 - 100% relief for up to five years (dependent on location, for new developments) At present, hotels on average pay 15% in duties and taxes.A flat rate corporation tax of 25% is payable on taxable income of corporations in Iran.
t Obtaining the required permissions, licences, and authorisations:municipality licences, security approvals, any land owner permission, cultural heritage permission, environmental clearance t Submitting the construction data (maps, diagrams, etc.) for approval by a certified planning consultants nominated; t Approval of construction timeframe
Government support and incentives LEGAL REGIME: Licensing Applications for constructing a hotel establishment (such as hotels and resorts) VKRXOG EH ¿OHG ZLWK ,&+72 RU LWV RI¿FHV in the central city in the province where the infrastructure will be constructed). Normally, the following should be followed for a construction permit to be issued: t Application to ICHTO; t Approval of the Technical Investment Committee of ICHTO; t Preliminary approval of ICHTO;
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The Iranian government offers a number of incentives for development projects in the tourism and hospitality sector, including: t New hotels are free to set their tariffs based on market conditions; t Lands for development projects approved by ICHTO are made available to the project under 5 year lease-to-purchase arrangements where the amount of lease payment will be determined by qualified valuers appointed by the government. This means that the developer will pay
March – June 2013 7,495
Number of beds
200,000
(in the form of monthly or annual rent) the net value of the land rather than the market value; t Foreign investors can own land through a locally registered company in which they can hold 100% of the shares; t Applications for tourism development projects will be fast tracked by local organisations such as municipalities; t Subject to certain conditions, tourism projects benefit from exemptions and incentives under the Foreign Investment Promotion and Protection Act (2002); t Access to financing from local banks for up to 80% of the project value. The rate of return on this type of financing (currently 6%) is significantly lower than that provided for other projects (normally above 22%); t Various exemptions and reductions in municipal rates payable by the project; t Tourism development free zones will be exempt from tax for 30 years.
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