D E V E L O P M E N T
Q U A R T E R L Y
IHG® Europe’s Development, Design & Openings magazine
Welcome to Europe: Bringing Kimpton® Hotels & Restaurants to the region
Travel: Growing our estate in Portugal and a guide to the beautiful city of Porto
A Tale of Two Brands: Exploring the case for dual branded properties
The Results Are In: Holiday Inn® Open Lobby proves its worth in our latest winning metrics
Lorien Hotel & Spa A Kimpton® Hotel
Your next growth opportunity IHG® is one of the world’s leading hotel companies. Our scale, experience and dedication to quality ensure that your next growth opportunity will be supported every step of the way: from signing, through the design phase, to opening and operating a successful hotel. Whether you choose to franchise with us, or opt for an IHG management agreement, the diversity of our brand portfolio allows IHG hotels to meet guest needs whatever the occasion – ultimately adding up to better returns on your investment. To find out more about developing your hotel with IHG, visit www.ihg.com/development *Data correct as at 31 December 2015
IHG® hotels host over 170 million guest nights per annum, over 740,000 rooms in over 5,000 hotels in nearly 100 countries around the world*.
co n te n ts Welcome to issue four
Introducing Kimpton® Hotels & Restaurants
Welcoming the brand to the region
Meet... Ramsey Mankarious and Phil Golding
Discussing the first Kimpton signing in Europe
Kimpton Hotels & Restaurants in numbers
All the facts and figures
Travel: Growing IHG’s estate in Portugal
Putting our stake in the ground and the allure of pretty Porto
Interview with... Stephen McCall
Chief Operating Officer, Europe
A Tale of Two Brands
The opportunities of dual branded properties
And the Results Are In
Holiday Inn® Open Lobby results and the ongoing innovation of the brand family
IHG® on the Road
Where we’ve been: our presence at industry events across the patch
Dates for your diary
Where we’re going: when and where to find IHG in the coming months
A Day in the Life of... Karan Khanna
Vice President Design & Engineering, Europe
Full year results
2015 in numbers
Credits: Editor-in-Chief: Catherine A. Ross | Picture Editor: Rachel Fermie | Contributors: Robert Shepherd | Philippe Bijaoui | Abigail Goldsbrough Photography: Plainview Media | artiste-associe.com | Cris Molina | IHG Design: Marc Pattison | Tracey Gibbins | Geoff Turner (H&O) Print: Bob Goodchild (InnerWorkings) Cover image: Hotel Monaco Pittsburgh, A Kimpton® Hotel For advertising enquiries, please contact email@example.com
Make success 1°C more successful. We understand that our guests are driven to succeed. And so are our owners. In the right locations, the Crowne Plaza® brand outperforms its competition and can drive above average gross operating profit for owners. Celebrate success with Crowne Plaza® Hotels & Resorts.
We lco m e to issue four When I am asked what do I hope to achieve in 2016, I can only say one thing: what we did in 2015 and more. When I look at all that has happened in the last 12 months, I am so proud to be part of this region, to lead such a talented team and to work alongside such committed partners. In an industry that never stays still, IHG® has shown dedication as a global leader. We welcomed new owners to the IHG family and strengthened relationships with our existing partners. We have developed number one mobile apps and impressive digital channels. We have grown the world’s largest hotel loyalty programme. We have devised pioneering new programmes like our Advantage Pricing model, making it cheaper to book direct. It is game-changing initiatives like these that make IHG brands the preferred option for investors and guests alike. We explore that theme of innovation in this issue, looking at the excellent results of Holiday Inn® Open Lobby. As the biggest hotel brand family in the world, Holiday Inn is expected to set the pace and now that the Open Lobby has proved its worth and passed European Brand Standards, I’m pleased to say that every Holiday Inn hotel in Europe will have an Open Lobby by the end of 2019. We currently have 24 Open Lobbies in Holiday Inn hotels across Europe, with another 39 planned to be opened in 2016. One of those paving the way is Holiday Inn® Ufa, Russia’s first hotel to feature Open Lobby and a great example of the brand’s potential in that market. Staying with the brand family, I’m delighted to wish Holiday Inn Express® a happy 25th birthday this year. In those 25 years it has evolved to become what is now our fastest growing brand. The next generation of the brand’s design - which we call Generation IV - is gaining traction with every new signing and opening. If you haven’t been to the Holiday Inn Express® London - Park Royal which opened with the first Generation IV public space and Holiday Inn Express® London - Ealing, which has both the Generation IV public space and guest rooms, I urge you to go. And don’t forget to try the coffee. The expanded F&B is a real step change for the brand. Then of course there’s Kimpton® Hotels & Restaurants - this issue’s cover feature. We started this year with our first signing for the brand in Europe, in Amsterdam, and we are looking forward to adding more great hotels to the pipeline. In Kimpton, IHG has acquired an award-winning, high performing brand that, when we bought it, was the largest independent boutique in the US. That impressive track record combined with IHG’s global reach, scale and systems delivery puts the brand in a uniquely powerful position. Given boutique is the fastest growing sector, IHG now presents investors with two defined propositions to enter the segment through Kimpton and Hotel Indigo®. When I look at our suite of brands, we’ve much to be proud of over recent times. We have regained excellent momentum of Crowne Plaza®, with the opening of a number of flagships in the region, including the Crowne Plaza® Gerrards Cross and the Crowne Plaza® Newcastle - Stephenson Quarter which opened with an unforgettable party. And with each year, Hotel Indigo grows ever stronger with Hotel Indigo® London - Aldgate, Hotel Indigo® Berlin City - East Side and Hotel Indigo® Bath entering our pipeline and the superb Hotel Indigo® York re-setting the benchmark for the brand. You can see these hotels and more in our openings section from page 32. In addition to our openings, last year we achieved some truly fantastic signings, three of which were InterContinental® hotels. This year InterContinental celebrates its 70th anniversary. The brand continues to grow; entering new markets like last year’s debut in Slovenia with InterContinental® Ljubljana. The InterContinental® Lyon - Hotel Dieu and InterContinental® Bordeaux - Le Grand Hotel cemented IHG’s status as the leader in France’s luxury sector. We opened InterContinental® Estoril, our third InterContinental in Portugal which is an evolving market that we look at on page 16. InterContinental is one of the world’s leading luxury hotel brands. These latest hotels, and our commitment to renovating legacy properties, will ensure InterContinental retains its prestigious name. So 2016 lies before us and with continued commitment it will undoubtedly be another phenomenal year. I want to personally thank all of you for making IHG your partner of choice and especially those who signed deals and opened hotels with us last year. Long may we continue to create Great Hotels Guests Love together.
Rober t Shepherd
C h i ef Deve lop m e n t O f f i ce r a n d S V P Deve lop m e nt, D e si g n & Op e ni ng s, Euro p e
B R ANDS
Welcoming Kimpton ® Hotels & Restaurants to Europe
Hotel Monaco Pittsburgh, A Kimpton® Hotel
When IHG® completed the $430m acquisition of US-based Kimpton® Hotels & Restaurants in January 2015 it became the world’s leading boutique hotel business. In 2016 Kimpton goes global and the year got off to a fantastic start with the brand’s first European signing, in Amsterdam. What opportunities does this expansion present and where will IHG position the award-winning brand outside of the Americas?
B R ANDS
First impressions are everything. So as the well-established and much-loved US brand Kimpton Hotels & Restaurants makes its debut in Europe, all eyes will be on the properties leading the pack. “Launching outside of the Americas is such an exciting prospect and one we all want to get absolutely right from the outset” Mike DeFrino, CEO at Kimpton, tells us. “The way that we launch will communicate a lot about the way we intend to position the Kimpton brand globally. It is such an important phase. We have the opportunity to set the appropriate standard now.”
Identifying that standard and understanding what IHG has inherited has been widely discussed. While Kimpton in the US plays in the upper upscale segment, its Europe estate will straddle the upper upscale and luxury end. Boutique and lifestyle is far more established in Europe and the expectations are high. A different market demands a different approach which presents both opportunities and challenges. “I do think it’s a challenge but it’s an exciting challenge” says Ave Bradley, Kimpton’s Global SVP Design & Creative Director. “It will push us and we will have to work harder to find a way to make that local connection. Thankfully IHG’s presence across Europe means there are teams in place who understand those local nuances. They will work closely with our operations team to make sure that our level and our style of service is translated appropriately in every city and every country we go to.” 05
B R ANDS
Firesky Resort & Spa, A Kimpton速 Hotel
B R ANDS
Kimpton® is exactly the right brand to complement our existing portfolio and right now is an excellent time to introduce it internationally. Robert Shepherd Chief Development Officer and SVP Development, Design & Openings, Europe, IHG®
Today, boutique is the industry’s fastest growing segment, but when Bill Kimpton founded Kimpton Hotels & Restaurants in 1981, the segment was still finding its feet. Identifying a gap in the market between pricey luxurious offerings and generic budget brands, he introduced the concept of “selling sleep” in European-style hotels with high-profile restaurants attached. It was a winning formula that resulted in a collection of approximately 60 hotels and restaurants across the USA. His vision paid off and when IHG purchased Kimpton, it was a multi-award winning company that had grown into the biggest independent boutique in the US. Now the brand is entering the global market, where competition is strong. Here Kimpton will be in the ring with established players in the sector including Hotel Du Vin and Firmdale and niche newcomers such as Ace Hotel, together with collection brands launched by IHG’s more traditional competitors. However, Kimpton’s 35 years of experience, its reputation for operational and financial success and its sophisticated restaurants and bar proposition shows that it is a brand that can more than hold its own in the competitive European marketplace. It can win. Robert Shepherd, IHG’s Chief Development Officer and SVP Development, Design & Openings, Europe elaborates, “Kimpton is exactly the right brand to complement our existing portfolio and right now is an excellent time to introduce it internationally at a stage where there is a heightened level of interest and development activity in the boutique and lifestyle hotel sector. The brand has a very strong growth potential in the wonderful capital cities of Europe and there is a high level of interest from our partners and owners to develop Kimpton hotels.” One of those capital cities is Amsterdam, which is the first location in Europe to have signed a Kimpton hotel. Pen was put to paper in January 2016 and will be a rebrand of the current Crowne Plaza® Amsterdam City Centre. The hotel is owned by YC Amsterdam BV, a venture set up by certain affiliates of York Capital Management and its operating partner. The property will undergo a complete transformation and true to Kimpton’s style, will feature boldly designed, boutique rooms as well as a destination bar and restaurant, a state of the art gym and innovative meeting spaces equipped with the latest technology. Slated to open in 2017, it’s a fantastic addition to IHG’s estate and an important debut for the growth of the brand.
B R ANDS
Mike DeFrino Chief Executive Officer, Kimpton® Hotels & Restaurants
Launching outside of the Americas is such an exciting prospect and one we want to get absolutely right from the outset.”
Driving growth whilst retaining the magic of what makes Kimpton great will be the key to its success. It isn’t cookie cutter; it is something that keeps design and brand identity at the forefront. Kimpton and IHG have many things in common, not least shared values for brand building. But what is a brand-defining Kimpton? Inventiveness and irreverence are the staples - across both the hotel and the restaurant and bar offering. It’s about warm genuine service, superlative style in a distinctive and whimsical tone at a luxury level. It fills what was a blank space in the IHG portfolio and will complement existing boutique brand, Hotel Indigo®. By keeping both brands true to their positioning, IHG now presents investors with two very different boutique propositions depending on the city, the guest profile and the achievable rate. Kimpton’s strong track record of operational and financial performance combined with IHG’s reach and scale will enable the brand to grow at an accelerated rate. Using IHG’s world-class digital and mobile platforms, Kimpton will enjoy incremental, high-rated business on an extended scale - something unique for a boutique player. And there will be a lower cost of sale as the brand leverages IHG’s third party agreements and hotel operating costs, while IHG benefits from Kimpton’s industry-leading design skills, destination restaurants and bars concepting and operation.
Morrison House, A Kimpton® Hotel
B R ANDS
B R ANDS
B R ANDS
Kimpton’s strong track record of operational and financial performance combined with IHG’s reach and scale will enable the brand to grow at an accelerated rate.
A core component of the Kimpton success story is their sophisticated restaurant and bar concept, which is devised and operated independently to the hotel, with separate general managers and teams. For Kimpton Hotels & Restaurants to make a successful journey across the pond, it must retain its show stopping restaurants and bars which is just as important as the rooms. Ave elaborates, “Our point of view has always been that if we create a restaurant and bar that is loved by locals, it will also be loved by guests. We always avoid a hotel restaurant that is only used by hotel guests so we make sure we have differentiation when developing a restaurant and bar. Rooftop lounges have become an intriguing and profitable proposition. Everybody likes to sit outdoors, enjoy the fresh air and the beautiful view. It can be an inner city respite; there’s nothing like being on a special perch just out of reach but still so close to the bustle below. Our bars can also be very different to the restaurants and also the hotels. That uniqueness is very important to us and one of the reasons we’ve been very successful in the restaurant business. It forms a major part of the investment case.” There is lots to love with Kimpton; from the independent spirit to the service culture and the prestigious restaurant and bar concepts to the design differentiation. Ave concludes, “Kimpton is a very particular brand and one that’s close to our hearts. Mediocre is not an option. So we will work hard to ensure we sign only the best hotels into the system. It’s taken a year to clarify the brand in this region but 2016 is Kimpton’s year. And you’ll see, it will have been worth the wait.” For questions about Kimpton Hotels & Restaurants development opportunities in Europe, please email firstname.lastname@example.org.
Hotel Monaco Seattle, A Kimpton® Hotel
It was the marriage of the Kimpton® creativity with the marketing muscle and reservations systems of IHG® that made choosing Kimpton a very compelling decision for us. Ramsey Mankarious, YC Amsterdam BV
Ramsey Mankarious and Phil Golding In January, YC Amsterdam BV signed a management agreement for the first Kimpton® Hotels & Restaurants hotel outside of the US. We caught up with Ramsey Mankarious and Phil Golding to ask why they decided to sign the hotel in Amsterdam, the appeal of Kimpton and the excitement of bringing the brand to Europe.
The hotel is currently a top performing hotel. Why did you decide to reposition it as a Kimpton? Ramsey Mankarious: We believe that the Kimpton brand and all its touch points will lead to a higher performance in addition to a new guest experience in Amsterdam. Phil Golding: We can put this hotel at a premium to where it’s currently trading and create something that the locals will be really proud of. Overall, we see an opportunity within the under-developed lifestyle segment, and that’s where Kimpton excels. What are the demand drivers of this location? RM: There’s strong leisure and corporate demand. A lot of international companies are headquartered in Amsterdam and it is also one of Europe’s most popular leisure destinations. PG: In terms of where the hotel sits in the city, it’s a premier league location. You’re two minutes from the main train station, and within a short distance from the museums, canals, restaurants, and all the business areas. What about this segment do you think works so well? RM: Europe has an established boutique market, but even though Amsterdam is one of the most visited cities in Europe it is under served in terms of lifestyle and boutique hotels. We’re seeing a change however and a number of lifestyle hotels have recently opened and they’re doing very well. What makes Kimpton different? PG: Everyone has their take on it, but our view is that Kimpton is a bit more sophisticated than its European peers. It has longevity. It won’t be a matter of what’s cool today isn’t tomorrow and because the brand has that distinctive style and a hint of rebelliousness, we think it can make a real connection with Amsterdam travellers. RM: Nothing is cookie cutter in this segment but Kimpton definitely has a different personality. We looked at lots of brands in the segment, but felt that Kimpton and IHG® were the right way to go.
Why? What was the particular appeal of Kimpton and IHG? RM: It was the marriage of Kimpton’s creativity with the marketing muscle and reservations systems of IHG that made choosing Kimpton a very compelling decision for us. How does it feel to sign the first Kimpton outside of the US? RM: There’s pressure to set a high standard and that’s actually a positive. People want to see what a European Kimpton will look like and hopefully everyone will be pleased with the result. PG: We don’t want to rush. We’re going to take our time to tender it right, procure it right and plan it right. We have one shot at this. We’re putting in a lot of effort on the design process and of course on the restaurant and bar concepts. Can you tell us anything about the overall design and the restaurant and bar concept? PG: We’re assembling a great team with a fantastic local architect who’s worked on a lot of historical monuments in the city. Today the hotel lacks visibility and kerb appeal, so we want to soften the entrance and make all of the spaces engaging. The restaurant will have its own identity, which is key to the Kimpton brand. RM: Food and beverage is the hardest part of the hotel business to get right. Operating successful neighbourhood restaurants is one of Kimpton’s skill sets and one of the main reasons we decided to go with them. After all, they know that if you create a place where locals want to spend time, hotel guests will also be drawn to it. How does this fit into your portfolio strategy? RM: It fits very well. We like to buy assets and improve underlying performance through renovations and better operational efficiencies. We know and have worked with IHG on many projects. We are now looking forward to infusing that model with an extra layer of creativity and working with the Kimpton team on what will hopefully be the first of many projects that we do together.
INFO G R AP H IC
InterContinental速 Porto - Palacio das Cardosas
Grow i ng t he IHG ® E state i n Port ugal Portugal is one of the most attractive tourist destinations in Europe. With three InterContinental® hotels in the country, we look at what further opportunities this relatively young market presents IHG® and shine a light on the new darling of the weekend break, Porto. The economies of southern Europe have gone through turbulent times since the start of the recession in 2008, but going into 2016 there are signs of change; stronger GDP growth suggests a stabilising economy and lower air fares and improved routes are luring tourists away from more familiar and expensive counterparts. Portugal still has a comparatively small hotel market and to date deal activity has largely focused on Lisbon and the Algarve. But unburdened by the premium purchase prices seen in the likes of rivals Milan or Barcelona, more cities are opening up to development. Places like Estoril and Porto in particular, present an increasingly attractive return. InterContinental® Porto - Palacio das Cardosas was the first really big project in what was an undeniably neglected city. Once great buildings had fallen into disrepair and commerce had all but dried up. Hylko Versteeg, Associate Vice President of Development in Southern Europe told us, “InterContinental® Porto - Palacio das Cardosas was a bit of a punt. The building was a 200-year-old palace and a total catch, but we signed it just before the economic crisis and opened in the midst of it. As to be expected, the first year was a tough one, but the last few years have been very successful in both revenue and guest appreciation.” In fact Porto is one of southern Europe’s great success stories. Visit the city now and the InterContinental is the hotel to stay at in the district of choice. Designed by interior architectural designer Alex Kravetz, the former palace - known for its high ceilings and immaculate Portuguese décor - overlooks Liberdade Square. It is surrounded by new restaurants, bars, high-end retail and an emerging boutique scene. “It’s a magnet,” Hylko continues “and now that we are seeing opportunities open up there is even more potential for other brands such as a limited service Holiday Inn Express® in the city centre. We don’t have any Hotel Indigo® hotels in the country yet, and there is a real gap in the market for the brand now. It’s absolutely crying out for it.”
Crowne Plaza速 Porto
InterContinental® Estoril The InterContinental hotel in Porto proved the city’s worth - IHG signed the flagship Crowne Plaza® Porto at the end of 2014 - and it also showcased the brand’s capabilities in a country that had been through the mill. It’s no coincidence that the InterContinental® Lisbon and InterContinental® Estoril signings came into the system shortly after. To have three InterContinental hotels in the country makes IHG leaders in the market. The most recent opening, InterContinental® Estoril is a prime example of an outstanding property in the incredible location known as the ‘Coast of Kings’, while the InterContinental® Lisbon is in the middle of a phased refurbishment as part of the owners’ commitment to restore legacy properties.
Portugal’s economy is growing and local demand drivers for the mid-market segment are strong. IHG’s portfolio of five Holiday Inn Express hotels and four Holiday Inn® hotels has by no means cornered the market and the brands have plenty more opportunity for expansion. Hylko confirms, “The mid-market segment is really important in Portugal and we have some great properties that are extremely well managed. In a widely unbranded market, Portugal has taken these brands in tremendously well and there is so much potential to grow them, especially with the Holiday Inn Open Lobby and Holiday Inn Express Generation IV designs.” Some IHG properties in Portugal are managed by IHG. This makes for great operational efficiencies, with management being centralised for the Crowne Plaza® Porto and the InterContinental® Porto - Palacio das Cardosas and likewise the InterContinental® Lisbon and InterContinental® Estoril. These synergies from admin to human resources, sales & marketing to purchasing offer streamlined costs and more effective staffing models - core components of a growing market. These efficiencies and Portugal’s increasing presence as a major player in the market present a unique investment case. The properties are affordable, the build costs are lower, the cities are growing and the tourist demand is there. It’s taken some time to evolve, but Portugal’s time is now.
Portugal presents a unique investment opportunity. The properties are affordable, the build costs are lower, the cities are growing and the tourist demand is there.
Portugal’s second largest city is the kind of higgledy piggledy wonderland that one willingly gets lost in for a weekend. A UNESCO world heritage site, the Ribeira district is the city’s historic centre, whose colourful buildings, impressive bell towers and extravagant churches form a major part of its personable charm. But Porto’s appeal lies not only in its medieval history but in its present-day status as a thriving metropolis that is every bit the busy commercial city as it is a picture-perfect tourist destination.
Over the last 20 years the city has been on the receiving end of some long overdue TLC and as a result, looks better now than it has for decades. An efficient metro system slinks through the city, while a state-of-the-art airport welcomes ever more low cost flights with capacity for further connections. Modern galleries, museums and concert halls host today’s most highly regarded artists and rising stars alike - with two must-dos being the Museu Nacional Soares dos Reis and the world-class Fundação Serralves museum of contemporary art. The river Douro snakes through the city and is increasingly popular for river cruises, while sites like the former stock exchange Palácio da Bolsa and the church of St Francis are rather less obvious but no less impressive sites.
The birthplace of port, Porto has long been a Mecca for wine connoisseurs and with superb restaurants and bars opening across the city, it is fast becoming a gastronomic delight. It more than holds its own in a region bursting with cosmopolitan cuisine, and makes for a great alternative to bigger cities like Paris, London, Lisbon and Barcelona.
The renaissance of this once sleepy city has encouraged a boom in tourism and the rise of low cost airlines makes it ever more accessible. As Europeans pop over for Instagram-filled weekends, it seems the best kept secret in southern Europe is a secret no more. And it is all the better for it.
Even before I really understood the business, I always liked the feeling of walking into a hotel. There’s something truly exciting about them.
Stephen McCall Stephen McCall is Chief Operating Officer, Europe and is responsible for operations and performance support across IHG’s managed and franchised hotels in Europe. He started his career in the hotel industry with UK hospitality group Stakis plc after graduating from the University of Dundee with honours in accountancy and business finance. We caught up with him to discuss Operational Excellence, retiring Holidex® and his teenage dreams of becoming a DJ.
How was 2015? We are delighted with our results in 2015. We’ve enjoyed a huge improvement in terms of operational performance and at the end of October 2015 we were hitting 9 out of 11 metrics. We’re all very proud of that and I’m extremely pleased with the team. If you look at things like our guest love metric HeartBeat, they’re just getting better. This is key to building brand strength and preference. It’s not an overnight job. It requires the long haul and they’re a dedicated team.
How is Kimpton® going to be absorbed into the system? Our senior team will be deeply involved in bringing this exciting brand to Europe and we’re currently working through exactly how that will happen. The challenge with any boutique hotel is to keep it individual but we also need to make sure that we can grow across Europe. We are looking at how we make Kimpton’s service culture relevant and real in Europe and that’s an interesting challenge because culture is behavioural not technical.
Tell us more about Operational Excellence. Last year we took a long look at our operating model which was fit for purpose some time ago but the world has changed. Our business is a lot bigger, the composition of our hotels and owner groups has changed and their expectations have changed. In the past we took a cyclical approach to visit as many hotels as frequently as possible. We’ve now put a lot more rigour and science behind it so it’s a much more targeted process.
Now a bit more about you… What did you want to be when you were young? My father had quite a traditional approach and encouraged me to take a relatively traditional route into business which was to study accountancy at university. It’s fair to say that my childhood dream was not to be a chartered accountant. I did consider becoming a stockbroker or investment banker at one stage when it was more fashionable than today, but deep down I really only ever wanted to be a DJ - big tunes, hands in the air type stuff. Oh well.
What is that process? We define what matters, then we measure and analyse their performance and once we’ve diagnosed the problem and found a solution, it’s time to start embedding it into the hotels. We spend most of our time physically visiting those hotels which require specifically tailored solutions to their performance challenges. The goal is to be much more discriminating about the kind of support the hotel needs depending on its circumstances. We’ve heard a lot about the new Global Reservation System (GRS), do you have any updates? Holidex® was the world’s first computerised GRS and we’re proud of that pioneering technology, but the time has come for a new model. We’re aiming for a phased roll-out and of course our teams will be ready to support that when it comes. The goal is to improve the guest experience at every stage of the guest journey through on-property and mobile technology, adding real value to our guests and driving business to our hotels.
So what is the appeal of hospitality? Even before I really understood the business, I always liked the feeling of walking into a hotel. There’s something truly exciting about them. I spent the first 15 years of my life spending my holidays at a farmhouse in Dumfries and Galloway. I didn’t leave the UK until I was 16 when I went on my first holiday to Corfu so hotels were always really glamorous to me and it still feels like a very sexy, cool business. We take it all very seriously, but it is also a fun and exciting business and we should enjoy it more.
A Tale o f Two Brands
With increasing land prices and construction costs, there is a greater need than ever to find creative solutions to the challenges facing hotel development. Dual branding is just one of those solutions. We look at the many benefits of multi branding and speak to the people who have first-hand experience of the model.
Although the concept of dual branded hotels has been around since the 1980s, there is an increasing demand for the model. IHG速 has built a successful estate of dual branded properties across the world and as the battle for available land gets fiercer in Europe and building costs increase, the time is right for innovative responses in this market. Dual branding is one of those responses. Given the evolving demands of both the consumer and the industry, dual branding is a tailored solution that enables owners to tackle two segments within the same footprint.
Rendering of Crowne Plaza® and Holiday Inn Express® London - Heathrow T4
Developing a dual branded property is by no means simple but
A streamlined staffing model is optimum for savings. Founder
it presents unique opportunities to achieve efficiencies through
of Borealis Hotel Group, Bart van de Kamp who developed the
effective management of shared resources. Shared back-of-house
Holiday Inn® and Holiday Inn Express® Amsterdam - Arena Towers
and engineering teams, maintenance teams and marketing efforts
told us their approach to efficient resourcing, “We have one general
can significantly reduce operational costs, which paves the way
manager for both properties. They oversee the core line between
for increased profits. While the build cost remains approximately
the two hotels. Then there’s two assistant managers who run the
the same, the operational savings present an opportunity to
two hotels individually. The general manager of the two properties
needs to be extremely flexible and have a deep brand knowledge. There is a big distinction between the brands and you have to create that distinction otherwise you have guests wondering why they’re paying more for the Holiday Inn® than the Holiday Inn Express®.” 25
Retaining this clear distinction between both brands is key to the
That synergy can also be seen between the Holiday Inn and
success of the dual branding model. The unique personalities
Holiday Inn Express brands: a combination that, in addition to the
and service cultures of both brands must be visible if guests are
Amsterdam - Arena Towers property, is seen in the recent Holiday
to appreciate the values of each one. This differentiation can also
Inn® and Holiday Inn Express® Munich - City East signing. However,
be achieved through intelligent design. Dexter Moren, director of
as cohesive as some brands might appear, it is the location that
architect and interior design specialists Dexter Moren Associates,
ultimately determines the correct pairing.
told us, “It is important to maintain the brand integrity of the two offers through design and differentiated guest experience.
Airport locations present an especially clear case for dual branding.
For example even if some public space is shared, brands should still
The Aberdeen airport and London Heathrow airport properties are
have separate front desks and lobbies so the check-in experience
just two examples of dual branded airport hotels in IHG’s system.
is the same for each brand as it would be in any other property.”
Thanks to the captive group of mixed-market guests and available footprint, airports are premium locations. Often consisting of
Dexter Moren Associates were the interior designers behind the
large scale properties, airport real estate gives companies the
Holiday Inn Express and Crowne Plaza Aberdeen Airport, two
opportunity to gain a foothold with investors in prime locations on
brands that work particularly well together. Of the pairing, the
sites that would be too large for a single hotel. Large hotels can be
Holiday Inn Express serves as the volume driver while the Crowne
vulnerable to fluctuating demand, which puts the hotel’s economic
Plaza® focuses on higher rate paying demand sectors. Covering
viability at risk. Dual branding mitigates that exposure by appealing
these two aspects is critical for the success of any dual branded
to a wider pool of guests. In short, in the right location, two brands
hotel development and ensures one brand doesn’t cannibalise
can cover market demand more effectively.
the other’s demand. As a couple, it is the right mix: yield Crowne Plaza well and drive the right business into the Holiday Inn Express.
Ultimately investors want long-term sustainable yields in primary
These attributes will be seen at Heathrow with the Crowne Plaza
locations. IHG has global expertise and reputation for responding
and Holiday Inn Express® London - Heathrow T4.
innovatively to challenges and identifying opportunities in the
industry. Dual branding presents opportunities that might Of course some brands fit more comfortably together than others.
otherwise be lost in the single brand space, and in more complex
In addition to Crowne Plaza and Holiday Inn Express, there are
environments, present a convincing case for investment.
synergies between extended stay brand Staybridge Suites® and Holiday Inn as seen in Holiday Inn® and Staybridge Suites® London
For more information on dual branding opportunities with IHG, please
- Heathrow Bath Road and Holiday Inn® and Staybridge Suites®
London - Stratford City. John Wagner, partner in Cycas Hospitality, who operate the Stratford property told us, “I am often asked whether dual branded hotels compete with each other and my answer would be a resounding ‘no’. We have very distinct product positioning between our Holiday Inn and Staybridge Suites in London - Stratford City, both of which have been a great success. Guests understand the different offerings and we have one revenue
- Crowne Plaza® and Holiday Inn Express® London - Heathrow T4*
manager so take extra care not to compete on rates on the
- Holiday Inn® and Staybridge Suites® London - Heathrow Bath Road*
various distribution channels. We have seen such positive results
- Crowne Plaza® and Holiday Inn Express® Dublin Airport
in Stratford we are replicating the dual branding model with the
- Crowne Plaza® and Holiday Inn Express® Aberdeen Airport
new signing of Crowne Plaza and Staybridge Suites Manchester ®
- Oxford Road. The synergy between these two hotels and the operating efficiency we will employ will give us a real advantage over other hotels in the area.”
Developing a dual branded property presents unique opportunities to achieve efficiencies through effective management of shared resources.
Number crunch: IHG dual branded properties in Europe
- Holiday Inn® and Staybridge Suites® London - Stratford City - Crowne Plaza® and Staybridge Suites® Manchester - Oxford Road* - Holiday Inn® and Hotel Indigo® Berlin - Alexanderplatz - Holiday Inn® and Holiday Inn Express® Munich - City East* - Holiday Inn® and Holiday Inn Express® Amsterdam - Arena Towers *Pipeline hotels All data correct as at 31st December 2015
Holiday Inn速 and Holiday Inn Express速 Amsterdam - Arena Towers
We created a concept to work for the guest and the owner. Now we are seeing these excellent results, we know we made the right call Anja Mueller, Director of Holiday Inn® Open Lobby programme, IHG®
And the Results Are In… Holiday Inn® Open Lobby proves its worth as the IHG® innovation programme continues to reap rewards As part of IHG’s roadmap of innovation for the Holiday Inn® brand family, every Holiday Inn hotel in Europe will have an Open Lobby by the end of 2019. Now that the programme has passed IHG’s European Brand Standards, it will see an accelerated roll out across the region. How easy will this be to achieve across an estate of 280 hotels and how will owners and operators fare from this commitment?
Open Lobby transforms a non-profit lobby area to a revenue driving space through three elements: design, F&B and service. It is one of IHG’s most serious commitments to maintaining its ongoing relationship with guests and owners, once again demonstrating how game-changing innovation can transform a hotel brand. So far 24 hotels have adopted the programme with another 39 to open in 20161. But three years is a tight schedule to transform an entire estate of hotels, especially given the different demands of refurbishments, conversions and new builds. In response, IHG has worked with owners and operators to reduce build time and costs
“The goal is to keep the guests in the hotel” says Anja Mueller,
and develop several formats suitable for different layouts in the
Director of IHG’s Holiday Inn Open Lobby programme. “It is all about
various markets and locations.
keeping them happy, engaged and ensuring their needs are met so they don’t need to leave. Where they spend more time, they spend
“We understand that every hotel is unique” Anja confirms. “Before
more money and this is where the idea of Open Lobby came from.
we discuss anything else, we talk to owners about the flexibility of
We created a concept to work for the guest and the owner. Now we
the programme. We appreciate that every property is individual and
are seeing these excellent results, we know we made the right call.”
poses its own challenges. But we see every challenge as something we can work creatively to solve. It isn’t about enforcement, it’s about working together. There is always a solution to be found. We also understand if people refurbished their property only a year ago, we can talk about including the mandatory items. There are signature aspects that identify an Open Lobby and it can be that a minimal investment introduces additional revenue. The To-Go Café is a great example of that.”
Holiday Inn® London - Watford Junction 29
Holiday Inn® London - West In Europe, there’s no doubt that Open Lobby is a success with the hotels seeing a 7.4% points increase in Overall Experience on Guest HeartBeat. Over 85% of hotels stated Open Lobby made it easier to win new business2 and General Managers have also reported a positive impact on staff satisfaction, retention and recruitment. Research also shows a payback period of 3.5 years.3 These inspiring results in Europe have prompted an accelerated IHG-controlled roll out across the region. The brand is not only flying in Europe however. Globally, Holiday Inn is enjoying a period of impressive growth. In Q3 2015 alone IHG enjoyed the highest number of Holiday Inn signings in seven years, adding more than 10,000 rooms to the system. But while the numbers are powerful, the visuals are just as impactful. “When you see these pictures, you see the story we have created with the brand. Innovation doesn’t mean reinventing yourself or losing your identity. On the contrary, with this innovation we are strengthening our brand and preparing it for the future. Competitors are always snapping at your heels, so you have to evolve to stay on top. The key is to innovate in the right way for everybody - guests, owners, investors, operators - and I think we’ve seen that Open Lobby achieves that.” 30
Positive figures and feedback demonstrate that IHG is on the right path with its evolution of the Holiday Inn brand family. The forward-thinking design of the Open Lobby will soon be complemented by a new-look Holiday Inn guest room. Meanwhile pilots of the Holiday Inn Express® Generation IV public space and guest room design are achieving consistently impressive reviews from both guests and owners. The Holiday Inn brands are IHG’s bread and butter. They have been getting it right since Holiday Inn’s inception almost 65 years ago and with innovations like Open Lobby and Generation IV, they should continue to get it right for many more years to come. To discuss Holiday Inn and Holiday Inn Express development or refurbishment opportunities, please contact email@example.com. 1
Data correct as at 31st December 2015
GM Survey July 2015: 14/17 Open Lobby hotels in Europe
P&L 2 years’ data (versus non-Open Lobby Holiday Inn hotels)
Holiday Inn速 London - West
O P ENING S
2015 OPENINGS As the 2015 results show, the IHG® ambition to be #1 for owners, guests and colleagues is steadily
progressing. The European Development, Design & Openings team opened 36 great hotels and
02 03 04
signed 48 exciting new deals.
From the first meeting to discuss a new project the team works to enable your vision – advising
12 19 26
30 34 13 09
on brand selection, design and build, staffing and
technology and supporting the team right up to
the successful opening of the hotel. This helps
ensure that you are connected to the value that IHG brings from the very beginning. We look forward to working with you on more fantastic projects this year.
01. Holiday Inn Express® Toulon - Sainte-Musse Opened 09 January / 81 rooms New Construction 02. Crowne Plaza® London - Battersea Opened 12 January / 78 rooms Rebrand 03. Staybridge Suites® London - Vauxhall Opened 23 January / 93 rooms New Construction 04. Holiday Inn® London - Watford Junction Opened 20 February / 93 rooms Conversion Re-use 05. Holiday Inn® Frankfurt - Alte Oper, Germany Opened 1 March / 249 rooms New Construction 32
06. Hotel Indigo® Helsinki - Boulevard Opened 4 March / 120 rooms Conversion Re-use 07. Holiday Inn® Baku Opened 19 March / 223 rooms New Construction 08. Holiday Inn Express® Istanbul Airport Opened 24 March / 110 rooms Conversion Re-use 09. Crowne Plaza® Berlin - Potsdamer Platz Opened 28 April / 256 rooms Rebrand 10. Holiday Inn Express® Aberdeen Airport Opened 7 May / 193 rooms New Construction
11. Holiday Inn® Dresden - City South Opened 20 May / 91 rooms Rebrand 12. Holiday Inn Express® London - ExCeL Opened 16 June / 204 rooms New Construction 13. Holiday Inn Express® Grimsby Opened 30 June / 80 rooms New Construction 14. Holiday Inn Express® Belgrade - City Opened 02 July / 123 rooms New Construction 15. Hotel Indigo® York Opened 10 July / 101 rooms New Construction
16. InterContinental® Estoril Opened 20 July / 59 rooms Rebrand 17. Holiday Inn® Dresden - Am Zwinger Opened 24 July / 144 rooms New Construction 18. Holiday Inn® Ufa Opened 24 July / 193 rooms New Construction 19. Crowne Plaza® Gerrards Cross Opened 30 July / 138 rooms Rebrand 20. Holiday Inn Express® Birmingham - Castle Bromwich Opened 03 August / 110 rooms Rebrand
14 28 35 36 08 31 07
21. Holiday Inn Express® Dusseldorf - City Opened 03 August / 164 rooms New Construction 22. Holiday Inn Express® Middlesbrough - Centre Square Opened 17 August / 138 rooms Conversion Re-use 23. Crowne Plaza® Aberdeen Airport Opened 28 August / 165 rooms New Construction 24. Crowne Plaza® Newcastle - Stephenson Quarter Opened 31 August / 251 rooms New Construction
25. Holiday Inn® Tampere - Central Station Opened 01 September / 177 rooms Rebrand 26. Holiday Inn® London - Luton Airport Opened 02 September / 124 rooms Rebrand 27. Holiday Inn® Belfast City Centre Opened 07 September / 250 rooms Rebrand 28. Holiday Inn® Aktau Opened 30 September / 124 rooms New Construction 29. Holiday Inn® Cannes Opened 08 October / 100 rooms Rebrand
30. Holiday Inn Express® London - Ealing Opened 01 December / 80 rooms New Construction 31. Holiday Inn® Istanbul - Kadikoy Opened 11 December / 127 rooms New Construction 32. InterContinental® Bordeaux - Le Grand Hotel Opened 14 December / 130 rooms Rebrand 33. Holiday Inn® Sittingbourne Opened 18 December / 79 rooms Rebrand
34. InterContinental® London - The O2 Opened 21 December / 453 rooms New Construction 35. Crowne Plaza® Borjomi Opened 23 December / 101 rooms New Construction 36. Crowne Plaza® Istanbul - Florya Opened 31 December / 306 rooms New Construction
O P ENING S
Crowne Plaza ® Aberdeen Airport, UK
Hotel Indigo ® York, UK
O P ENING S
Holiday Inn ® Cannes, France
Holiday Inn ® Dresden - Am Zwinger, Germany
O P ENING S
InterContinental ® Estoril, Portugal
Holiday Inn Express ® London - Ealing, UK
O P ENING S
Holiday Inn ® Dresden - Am Zwinger, Germany
Hotel Indigo ® York, UK
O P ENING S
Holiday Inn ® Belfast City Centre, UK
Crowne Plaza ® Newcastle - Stephenson Quarter, UK
O P ENING S
Holiday Inn ® Tampere - Central Station, Finland
Crowne Plaza ® Borjomi, Georgia
O P ENING S
Holiday Inn ® Ufa, Russia
Crowne Plaza ® Gerrards Cross, UK
O P ENING S
InterContinental ® Bordeaux - Le Grand Hotel, France
Holiday Inn ® Aktau, Kazakhstan
IHG® on the Road IHG® rounded off 2015 with some fantastic roadshows across the region, including breakfast and lunch briefings in Warsaw, Paris and London. These events offered the team a chance to not only present their signings and openings for the year but also provide more information on our strategy for 2016 and beyond. In addition to thanking owners and operators for their ongoing relationship with IHG, these briefings provide a platform to show industry influencers and consultants the actions IHG is taking to build preferred brands; for example the Europe wide roll-out of the Holiday Inn® Open Lobby and the updated Holiday Inn Express® Generation IV guest rooms and public areas. They were also an excellent opportunity to provide more information on our commitment to guest loyalty through programmes like Advantage Pricing and IHG® Rewards Club.
UK & Ireland Development Breakfast
InterContinental® London Park Lane, 23 November 2015
France Investor Lunch
InterContinental速 Paris - Le Grand, 8 October 2015
Poland Investor Lunch
InterContinental速 Warsaw, 30 September 2015
TIRED LEGS W E L C O M E As proud sponsors of the Virgin Money London Marathon 2016, we’re here to do everything we can to help you achieve your personal best. Because a good night’s sleep is key, whether you’re training to run 26 miles or have a full day of meetings ahead.
Events… Dates for your diary The IHG® development team will be appearing at IHG-hosted roadshows and industry events across the patch in the coming year. To kick things off, the team will unveil exciting plans for Kimpton® Hotels & Restaurants at the International Hotel Investment Forum in March. This is followed by appearances at major conferences in the region, including MIPIM in Cannes and MITT in Moscow. We look forward to seeing you soon.
Upcoming Events 7-9 March
ce: n e r e f Con IHIF, Berlin
e: Conferenc MITT, Moscow 26-27 May
Conference: MIPIM, Cannes 25-29 April
nce: Confere ek, CRE We tan Kazakhs 30-31 May
Conference: Conference: Romanian Top Leaders in Hotel Tourism & Hospitality CEE Leisure Investment & CIS Summit, Conference, Vienna est har Buc
: Conference g Global Lodgin Forum, Paris 23-24 May
Conference: Boutique + Lifestyle Hotel Summit, London
Conference: Spotlight Hotel Investment Poland, Warsaw
We have a great set up in Design & Engineering in Europe - multiple projects, multiple owner groups, multiple brands, multiple disciplines. We have built up a truly multi-functional professional consultancy for our owners.
Day in the Life of…
Karan Khanna Karan Khanna is the Vice President of Design & Engineering in Europe. Based at the IHG® global headquarters in Denham, Karan was the Head of Strategy & Planning for Europe before moving to his current position in 2014. He has had a rich and varied career, from growing up in the Army environment in India to a stint as a TV presenter. Today, in between leading his 25-strong team and watching and playing sport, Karan’s life is dictated by his four-year-old son and he wouldn’t have it any other way.
“There is no typical day for me, which is one of the exciting things about this role. There are days I will start at 7:30am and there are days I will come in at 9:00am because I’ve dropped my son off at school. Monday is the only day where there is a bit of a routine. My direct reports and I get together to see what everybody is working on and align ourselves as a team going into the week. Our team, who are mostly based in the field, have between 15-30 live projects at any one time so it’s important I know what the key issues are, where they need me to intervene and how we are progressing against our plan and targets. We have a great set up in Design & Engineering in Europe - multiple projects, multiple owner groups, multiple brands, multiple disciplines. We have built up a truly multi-functional professional consultancy for our owners. I think we’re still growing as a company and it’s exciting to be part of that. The last 18 months have been quite transformational for the Design & Engineering team. We have completely re-designed Holiday Inn Express® from top to bottom and the first few hotels that have opened are at the very top of the rankings. The success of the Open Lobby at Holiday Inn® and the complete design repositioning of Hotel Indigo® has transformed both brands, reinvigorating growth and guest interest. We have also done fantastic work to build great assets like virtual tours and interactive design guides to help agencies develop great hotels and set up a new Interior Design function and an Innovation Rollout team to support our strategic agenda. And whilst we have done that, our team engagement has jumped 50%. There’s lots to be proud of!
I actually started life as a sports journalist many years ago in India where I worked for India’s second largest English newspaper The Hindustan Times. I loved sports and journalism gave me a forum to talk about it and share my point of view. I even moved on to presenting on television but didn’t enjoy it at all, so that was short lived. I was 19 years old and it was excellent ‘pocket money’ but I was never comfortable in front of the camera so I went back to print journalism. As time went on I realised that the journalistic arm doesn’t actually have a lot of decision rights, but the commercial arm does, so I moved into brand management and marketing as a result of that. I ended up working for Cadbury Schweppes for five years before doing an MBA at INSEAD in Singapore and France. From there, I went on to work for McKinsey & Co. in their London office which was a fantastic three years. I learnt so much about problem solving, how to build transformational programmes, how to influence change and work in a high-pressure environment. I love what I do and I’m very committed to IHG. I think I have always had a passion for hotels. My mother used to work for the Taj Group in India, so I grew up in a hotel environment. For me, part of the appeal of IHG is the sector itself. I think about travel and the memories that we are helping to create. Vacations in general, and hotels in particular, can be so powerful in creating life changing experiences and I want to help create those little memories for myself, my family and for others as well. The Design & Engineering team has made a real step change in how we design and build our brands. And as I look to the future, I see tremendous opportunities to be even more successful and I want to help make that happen.”
INFO G R AP H IC
Total worldwide rooms
ide rldw lly o w l Tota ls globa hote
ned s ope Hotel ull year) 5 (f In 201
Signings in Q4 2015
Tot develo al pme pipelin nt e
Data as at 31st December 2015
ambition to owards its oser t l c p 速 ste IHG saw
744,368 Total rooms t in developmen
Welcome to the Neighbourhood.
Hotel Indigo速 York
Be part of our growth story. Hotel Indigo速 brings together the best of both worlds; the unique design and personalised service of a boutique experience, with the assurance and convenience of a brand. With 65 hotels globally, 19 right here in Europe, Hotel Indigo速 is coming soon to a neighbourhood near you. * Data correct at 31 December 2015.
CONTACTS Robert Shepherd Chief Development Officer, Europe Tel: +44 1895 512 173 firstname.lastname@example.org Philippe Bijaoui Vice President Development, Europe Tel: +44 1895 512 976 email@example.com Karan Khanna Vice President Design & Engineering, Europe Tel: +44 1895 512 791 firstname.lastname@example.org Paul Phillips Vice President Financial Planning & Investment Analysis, Europe Tel: +44 1895 512 679 email@example.com Rebecca Bryson Head of Hotel Openings, Europe Tel: +44 1895 512 165 firstname.lastname@example.org
InterContinental Hotels Group plc Broadwater Park, Denham, Buckinghamshire, UB9 5HR, United Kingdom Tel: +44 1895 512 000
We would love to hear from you! Please direct any thoughts, suggestions or advertising enquiries to email@example.com