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| Sary Arab, COO, Nikki Beach EMEA Hotels & Resorts, a speaker at the marcus evans EMEA Hospitality Summit 2012, on converting ageing properties into high end hotels without compromising on the brand ethos. |
London, Sept 24, 2012 - (ACN Newswire) - Converting ageing properties into hotels has always been an attractive option for hoteliers, but in today's economy, it is proving to be a much faster and easier way of creating a brand presence in a specific market, says Sary Arab, COO, Nikki Beach EMEA Hotels & Resorts. This does not mean, however, that they can compromise on quality. "The strategy, objectives and ambitions of hospitality developments must be taken all the way. Hoteliers should not compromise on the brand ethos and DNA," Arab advises.
A speaker at the marcus evans EMEA Hospitality Summit 2012, in Istanbul, Turkey, 29 - 31 October, Arab puts forward his recommendations for transforming existing assets into high performance properties.
- Why is the option of converting ageing assets into new hotels more attractive for hotel investors today?
In times of financial crisis and a lack of financing, it becomes a lot easier to develop one's brand within an existing or converted hotel property. Greenfield projects are more costly, take longer to develop, and there are permit and regulation issues that can make the process more time consuming.
In the meantime, there will be no brand presence in a specific market. With converted projects, the turnaround of property is faster and the cash needs reduced.
- How can they ensure a profitable outcome?
They should not compromise on the quality and standards of the brand. There are bound to be some structural, design or space allocation elements that will not suit their standards (for example the rooms might be smaller), which is why many compromise their brand standards as they cannot have a best case scenario out of the property.
The trick is to strike a balance between what is ultimately necessary for the brand and the shortcomings that can be lived with, without compromising the brand, incurring major renovation costs or extending the timeline.
- How should they select projects? What studies are necessary?
In our case, location is key. We look at converting existing properties within the specific markets that are in our strategic development scheme. We can be opportunistic as long as a property falls within our target market and brand philosophy.
It is important to analyse the property from front to back, to see what has to be renovated to suit the brand design and operating procedures, and whether that makes financial sense. Brands do not give the same importance to all features.
- What opportunities can hoteliers take advantage of today?
The real opportunity lies in quick conversions of ageing properties into high-end boutique style hotels. By nature and financial history, boutique hotels yield better returns, but there are not many properties from the 70s and 80s that were designed with that philosophy in mind. Therefore, investors can consider converting three or four star hotels, keeping the structure of the building but perhaps changing the facade and reducing the number of rooms. We see this model being replicated in various locations, especially those that have a very high entry barrier.
Another advantage of converting ageing hotels is that hoteliers can take full advantage of previous, more lenient laws. Most likely, a new hotel on the same plot would not be allowed to have the same percentage of built up area.
About the EMEA Hospitality Summit 2012
This unique forum will take place at the Ceylan InterContinental, Istanbul, Turkey, 29 - 31 October 2012. Offering much more than any conference, exhibition or trade show, this exclusive meeting will bring together esteemed industry thought leaders and solution providers to a highly focused and interactive networking event. The Summit includes presentations on capturing a hotels target market, upgrading properties, and integrating green systems and solutions.
For more information please send an email to info@marcusevanscy.com or visit the event website at www.hospitalitysummit.com/SaryArabInterview.
Please note that the Summit is a closed business event and the number of participants strictly limited.
Contact:
Sarin Kouyoumdjian-Gurunlian
Press Manager, marcus evans, Summits Division
Tel: + 357 22 849 313
Email: press@marcusevanscy.com
Topic: Research / Industry Report
Source: marcus evans Summits
Sectors: Daily Finance, Daily News
https://www.acnnewswire.com
From the Asia Corporate News Network
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