Weekly European Hotel Industry News Roundup
Spanish Gold
Among the many uses to which 12 tonnes of 24-carat gold may be put are giving your new 41-suite luxury hotel an impressive finish and fashioning what is left over into cutlery for the restaurant. Just ask the German company, unnamed in reports, which is said to have spent €144 million for these purposes on a property it is to open near Marbella on Spain's Costa del Sol in 2005. NH Hoteles' preferred use for gold would seem to be as a lining for its pockets, which are bulging thanks to the €8.5 million sale of the NH Sant' Angelo in Barcelona. The company will stay on as the manager of the 50-room property, which is now owned by businessman César Orenga. Also with money to spend is Metrópolis, which has joined forces with Spanish savings bank la Caixa to pay a total of €45 million for two four-star hotels in the Canary Islands: the 370-room Occidental Allegro Oasis and the 315-room Occidental Grand Teguise Playa. The partners have signed a ten-year lease agreement on the properties with Occidental Hotels & Resorts.
Hurghada's What It's All About For Alfy
Architect Amr El Alfy, in partnership with Falcon Hotels, has signed up Le Meridien to manage a 520-room hotel on a five-star resort he has designed and owns in Salh Hashish, Hurghada, in Egypt. Le Meridien Hurghada, which is due to open early next year, will be Le Meridien's fifth hotel in the country. The company has nine properties in the United Arab Emirates, and at one of them -Le Meridien Dubai
new business and leisure facilities will doubtless attract admiring glances from delegates attending the Dubai 2003 World Bank/IMF conference. Back in Africa, Kempinski Hotels & Resorts will this month be opening its second hotel on that continent: the 100-room Kempinski El Farouk, which will be the first five-star hotel in Bamako, the capital of Mali.
Accor's Interims Build No Smiles
Accor added its personal bugbear the widespread strikes of early summer in France to the familiar unholy trinity of war in Iraq, the Sars virus and economic slowdown to explain first-half results that showed pre-tax profit down 40.6% at €180 million and revenues 7.8% lower at €3.3 billion. The darkest days for the hotels division fell in April, when the company's upscale and midscale European properties found their RevPAR 15.6% down on the previous year's comparable. RevPAR across Accor's entire portfolio has since recovered, although continued weak trading throughout the summer has kept it in negative territory at all except the US economy hotels, which posted a 0.5% rise in August. Accor, which is now forecasting full year pre-tax profit of some €500 million, is facing up to its problems by being more careful with its capital expenditure and continuing with an expansion strategy that should see it look back on 2003 as the year when it delivered nearly 180 new hotels worldwide.
Mövenpick Taps Into Water Tower
Mövenpick Hotels & Resorts and Patrizia Immobilien have signed a lease agreement on a 60-metre water tower that stands in the northern German city of Hamburg. The tower, Europe's tallest, will be extensively renovated so that it will begin 2006 as the 226-room, four-star Mövenpick Hotel Hamburg. Splashing back into Germany for a thirteenth visit is Sol Meliá, which has opened the 177-room, four-star Tryp Frankfurt. Across the border, in France, Rezidor SAS Hospitality and Orion are reportedly ready to immerse themselves next year in the construction of a 250-room Radisson SAS hotel after signing an agreement with Euro Disney to build at its resort near Paris. Elsewhere in Europe, a new 52-room lifestyle hotel about to open in Prague should be able to handle water music: the Aria has four floors, each with its own musical theme.
Jurys Judges Six Months Satisfactory
Remove the pre-tax profit of €3.6 million accruing from the disposal of the Jurys Green Isle and Jurys Tara and you can change a 0.3% increase in company pretax profit, to €25.2 million, into a 4.9% decrease. Not that Jurys Doyle Hotel Group would be unduly worried by your tinkering: it pronounced itself satisfied with results over the six months to 30 June which also revealed a 6.5% decline in turnover, to €123.7 million. Occupancy across the Jurys Inn properties in Ireland ran above 80% and remained in line with last year's figure at those in the UK. The company expects its performance over the second half of the year to be just as satisfying and it will use bricks and mortar to further build up shareholder confidence. With Jurys Inn properties newly opened in Newcastle and Glasgow, and with projects underway in Dublin, Heathrow, Southampton, Leeds, Chelsea (west London) and Boston, USA, Jurys Doyle will have an extra 2,100 new rooms in its portfolio by early 2005.
Bluebirds Over The Moon
A 154-bed hotel is set to feature as part of a new stadium that will rise from the rubble of Cardiff City FC's existing home Ninian Park, after the Welsh National Assembly approved the £165 million project. The Scottish city of Aberdeen too has an equally ambitious scheme to ponder after AWG Developments had its plans approved for the Justice Mill Lane mixed-use development approved, a project that could incorporate a 140-room hotel. Elsewhere in the UK, there is now more room to talk at the Sheraton Heathrow Hotel, where a dedicated conference centre has opened. And celebrity chef Rick Stein will swap the taste of the sea for the smell of brick dust, after he submitted plans to demolish his Rocklands Hotel in Newquay on the Cornish coast. A new 30-room hotel with restaurant will rise on the site in a £3 million project that will link the hotel restaurant via an external lift with a second restaurant on the beach below. The properties should be ready to serve in spring 2005.
Club Med Finds There Ain't No Cure For The Summertime Blues
Club Méditerranée (Club Med) is looking on a 10.9% leap in bookings over the four weeks to 7 September as something of a false dawn, lamenting as it is that this recovery cannot compensate for the rest of the summer season, which saw bookings decline 8.5% on the previous year's comparable. Like-for-like revenue over the third-quarter ending 31 July fell 10.5% to €387 million, although this decline was attributable, at least in part, to the disposal of Forum Voyages last November and the closure in April of Club Med World Montreal.
Meriton Sees Merit In Having More Hotels
Meriton Hotels is planning additions to its family, which at present consists of one hotel and one guesthouse in its Estonian homeland. That hotel, the Meriton Grand Hotel Tallinn, already expects a sister property, the Meriton Old Town Hotel, to arrive next March, but there could be a second delivery. The company, which is owned by businessman Alexander Kofkin, has reportedly drawn up plans for the US$18 million 164-room, two-star Meriton Aqua & Spa Hotel to rise next to the Meriton Grand Hotel Tallinn. Mr Kofkin apparently also has plans to convert buildings he owns in the neighbouring states of Latvia and Lithuania into hotels: one with 75 rooms in Riga and a two-star hotel with 100 rooms in Vilnius. If all that were not enough, then Meriton is also eyeing one hotel in Germany and one in the Czech Republic.
IHG Proceeds With Caution
InterContinental Hotels Group's (IHG) interim pre-tax profit of £92 million may have come as a pleasant surprise to the likes of analysts Morgan Stanley, but Chief Executive Richard North maintained IHG's cautious outlook. That profit figure after all was down 30.8% on last year's comparable in a world that has turned sour on the travel and tourism industry. Turnover slipped 3.4% to £1.04 billion. The effect of stay-away US visitors on trading in the Europe, Middle East and Africa (EMEA) region was noticeable in the RevPAR returns; whereas RevPAR was 2.2% ahead at owned and leased InterContinental hotels in the Americas region, spurred on by a rise in occupancy of 4.3 percentage points, it was 11.5% adrift at the corresponding hotels in the EMEA region.
Corus Takes The Axe To George Washington
Corus & Regal Hotels has sold the three-star George Washington Golf Hotel to the George Washington Golf and Country Club, a company reportedly set up for the sale by an unnamed local hotelier, for £5.63 million. The 103-room property, in Washington, Tyne and Wear, is one of 27 UK hotels that Corus & Regal put up for sale in January. Further south, US investment firm Blackstone Group has acquired the 221-room London Marriott Hotel Grosvenor Square for an undisclosed sum. The hotel will now submit to a £4.5 million renovation, which might include the addition of between 25 and 30 rooms. Elsewhere, down in Devon, the 35-room, two-star Great Western hotel in Exeter has been put on the market with a reported asking price of £1.35 million.
All Is Disquiet On The Jarvis Front
When he addressed the company AGM in July John Jarvis, the Chairman of Jarvis Hotels, said trading conditions were tough. Turnover then after 12 weeks' trading was down 2.7% on the previous year's comparable, and with the intervening month having proved little kinder turnover for the current year is 1.7% behind Jarvis Hotels has had to make cuts. Consequently, as just one of these measures, Carl Donnelly will depart from the company in early October as Managing Director, Scotland. Jarvis Hotels said the estimated £1.2 million all of these measures will cost will be reflected in the company's interim results statement in November.
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