Editorial

Dear Insiders,

Even fault loans could mean good bargains! As financial investors will sell their properties in the short or medium term, new chances are opening up for hoteliers willing to buy properties, as a property is not always bad just because the connected loan cannot be serviced. Our editor Anne Wiktorin, an expert on the real-estate and financial service market, describes the development of the non-performing loans. The dimension of this issue can be recognised, among other things, by the fact that there will be a congress on Non-Performing Loans in Germany on October 5 in Frankfurt and on November 9 and 10 in Berlin. And it will surely be an issue at this year's ExpoReal in Munich, which will begin in two weeks.

Last night, there finally was the official announcement regarding the sale of the Aldiana Clubs to the Spanish construction company Santana Cazorla. If the Thomas Cook brand will become a good bargain for the buyer is still open. That decision will bring up numerous questions as Cazorla is also connected with TUI.

NH's future with Buehlerhoehe has already been decided. Dietmar Hopp, otherwise quiet and controlled, doesn't want to clear the portfolio of Buehlerhoehe, but certainly wants to clear Buehlerhoehe of NH. He has, after all, a direct comparison: His golf resort in France is run by Four Seasons, "a super chain" he praises. He's still looking for investment opportunities but more in real estate than in hotels. The multi-billionaire knows what he wants and above all, when he has had enough of difficult partners. Our interview is clear in this much.

Another development comes with a lot less drama: the first hotel chains have begun offering Internet access for free. Here, a new field of competition is becoming apparent, which is mainly about attracting business travellers. However, the whole thing is still nothing but a confusing mess of prices for the moment. Our list comparing Internet access rates points this out. A request to the hotel groups to reconsider their offers!

Currently, the Americans are debating a lot about design hotels and hotels with boutique character. But Germany can keep up with that. Here, the profitable business with the niche hotels is gradually beginning to grow. In this way, individual initiatives aiming at mini lifestyle chains are opening up.

These few issues mentioned here mark a huge general trend concerning the tourism and hotel industry: changes either affect the entire market/great parts of the market or the niches. Executives think and act in extremes. The industry events and congresses in October will surely contribute some issues to that.

Yours, Maria Puetz-Willems
Editor-in-Chief


Your comments?
Please, write to: maria@hospitalityInside.com

Dear Insiders,

The most recent list of HVS International about the best paid hotel manager is somewhat provoking the ego of all CEOs. Who receives how much as a basic income and how big is the bonus on top of that? Those who earn the most belong to the circle of the "usual suspects". Nonetheless, when studying the table, the question for commensurate remuneration remains. Are 3.3 million dollars as basic salary + 15.2 million as a bonus still justifiable for the head of Cendant? By the way, there are certainly no European hotel names in this multi-million dollar poker game. And asking why makes no sense at all.

We give you the profiles of the industry's top managers, not only as pure facts and figures, but also with many personal details. With today's issue, we will start a new series on the travel habits of CEOs and other hospitality managers. And as I myself was a guest at Six Senses Resorts & Spas on the Maldives this week, you will read the details of their frequent travelling CEO Sonu Shivdasani and find out what he cares about most. By the way, the interview about the stressful nature of his job took place in a very relaxing atmosphere - below palm trees in the ecological design resort Soneva Fushi.

A totally different form of positioning can be observed at ArabellaSheraton and its joint venture partner Starwood Hotels & Resorts. As it is now clear that the US hotel group will be managing the hotels of Le Méridien, a triad relationship is created regarding brand and management. What happens, if both brands are pitching for the same hotel in one city? hospitalityInside asked some concrete questions to the responsible managers of ArabellaSheraton and Starwood - receiving nothing but evasive answers from Starwood. Industry experts make up their own mind about Starwood's role with Méridien: and that does not look good for ArabellaSheraton.

The Grand Hotels Bad Ragaz is also working on their repositioning. They want to combine their established main pillar health with wellness. "Medical wellness" is to increasingly fill the hotel beds in future. In contrast, most other health and wellness resorts in the German-speaking market like the Grand Hotels Bad Ragaz, have already had extensive experience with doctors and guests/patients.

So much for today's main topics. But even in our little reports and news you will read more about positionings and market positions.

I wish you an exciting week.
Yours, Maria Puetz-Willems
Editor-in-Chief


Please, write to: maria@hospitalityInside.com

Dear Insiders,

At some point, even the wealthiest owner is at the end of his tether: Dietmar Hopp, the founder of SAP and, among others, owner of Hotel Buehlerhoehe in Baden-Baden, officially and precisely comments on his quarrel with NH Hoteles. The man, for whom hotels can only be a hobby, has had enough of the operator who wanted to pull down his Grand Hotel Jewel to become a 3-star product. Only seldom does an owner issue such a clear statement - but personally, I think this is exemplary. hospitalityInside.com has been hot on the heels of the news concerning the Buehlerhoehe over the past two weeks - and NH Hoteles has tried to fob us off by applying "salami tactics". Dietmar Hopp's statement, however, explains that.

Reto Wittwer explains a lot today as well. He has been Kempinski's CEO for ten years now, but even for us, many details of his life were new. His flamboyant life and his unconventional appearance have therefore contributed to a portrait standing out from others. Some details of his life also explain his emphatic approach regarding Kempinski's expansion. At the moment, the pace will be kept, but consolidation is in sight. Today, Wittwer plays with open cards - in order to direct the view of his business partners straight ahead. Only seldom does the 56-year old speak about Kempinski in such an open manner.

Two other heads are currently cause for talk: Alois Hartl, the "Golf King" of Bad Griesbach, is once again on the brink of a tee-off with a new investor. Now, he wants to help the bathing province in becoming a world-class destination. Until these efforts result in a "hole-in-one", the self-made man needs to improve his handicap quite a bit.

On the other hand, there is Stelios, the smart "easy" entrepreneur from London. Now he has broken into Basel's hotel scene with cheap hotels that only cost 15 euros. Those who believed that Formule 1 was the lowest level are wrong. An easyHotel takes the biscuit by far: There are even rooms without windows! On top of this, each room is already a cell with a plastic bath, painted with bright orange distemper to hide the fact. And yes: the staff was hired 5 days before the opening and trained in a crash course. A paragon of cost saving! I know hotel chiefs who will consider that a great thing, but one question nevertheless remains: quo vadis, hospitality?

Stelios' bright orange budget cruiser anchored in the harbour of Monte Carlo, by the way. What irony. Three kilometres away, Chief Executives, Presidents, investors, developers and owners discussed all conceivable variants of maintaining at least some quality despite increasing cost pressure. Today, a fresh-from-the-press summary of that conference. More on this will follow next week.

In this vein: Enjoy reading.

Yours, Maria Puetz-Willems
Editor-in-Chief


Please, write to: maria@hospitalityInside.com

Dear Insiders,

Well, Espalioux is leaving. On January 15, 2006, Accor's CEO will have his last working day. What was "hearsay" for several weeks has now finally been confirmed. Accor remains quiet, the reasons remain unclear. This is not a good policy for a quoted group that is to increase its value through being transparent. But it is typical for France. News has spread that the new man at the top will come from the financial community: either directly from Accor's biggest shareholder, the state bank Caisse des Dépots or at least selected by it. Will such a man of figures have more charisma than Espalioux? Others claim that it has to be somebody from the financial community, as Accor could be the target of a hostile takeover in future...

Allegedly, Espalioux will receive a golden parachute of 12 to 15 million euros, as one can read. Why does somebody receive such a high compensation, although the agreement is running out as planned? Or is it "hush money" to prevent Accor shares from dropping still further?

That brings us to another question today: who earns how much and who can earn how much? A Swiss economic magazine has published the salaries of Swiss hoteliers. Reto Wittwer just laughed, when we asked him about this... The majority of hotel managers would already be satisfied if they earned even part of that. Today, two articles show realistic figures: An analysis by HVS Consulting in London about the bonuses for department heads and the market experiences of the headhunter Antje Maesse regarding the amount of salary General Managers can demand in Germany and abroad. A must for hospitalityInsider!

The GM of Hilton Muenchen Park sees himself facing empty conference rooms and empty coffers. International groups are threatening with a stillstand of the conference business during the Football World Cup next year. How will he budget June 2006? We have collected statements of hoteliers about football and conferences. An exciting issue, as the chains begin their budgeting for next year within in the next few weeks. The right feeling can bring a lot or cost a lot of money in these times.

If you like our topics this week, recommend us to others! hospitalityInside.com is turning six months old on September 11. And we are very happy that our reports on news and background information are attracting a continuously growing number of subscribers and visitors.

We wish you a good week with our exciting information,
yours, Maria Puetz-Willems
Editor-in-Chief


Your comments? Please, write to maria@hospitalityInside.com

Dear Insiders,

Staff issues dominate this week: One has to keep in mind new heads at Thomas Cook's hotel purchasing and those within the management of the fund investment company WestInvest. As already reported on Wednesday, the most exciting news of this week is about Carsten Rath, the previous Managing Director of Robinson Clubs. He will take on a central leadership position within the Schoerghuber Group and ArabellaSheraton Hotels in Munich.

The 39-year old succeeds Robert Salzl, upon whose contributions and reputation nobody in the industry would ever cast a doubt. That makes the challenge for Carsten Rath even greater, as he has "only" worked previously as General Manager before becoming Managing Director with Robinson Clubs. Now he faces a whole slew of new tasks concerning strategy and development. By the way, it has not yet been determined, which of the described tasks Rath's will be responsible for.

Anyway, the first few weeks will certainly be quite exciting for Carsten Rath: In October/November, for example, there will be negotiations with the joint venture partner Starwood that will also manage the Le Méridien hotels in future. Apart from that, Rath needs to get along with experienced "hotel men" at ArabellaSheraton Hotelmanagement GmbH: with Thomas Willms, Edgar van Ommen and Peter Wackerbauer. Neither these three nor the remaining Arabella staff had known of the staff decision at top level; most of them heard about it in the evening, right before the official announcement was announced via the media.

TUI, Rath's previous employer, left quite a bad impression in this case as far as the media are concerned. It claimed in front of hospitalityInside.com that it had dismissed Carsten Rath, while Carsten Rath claims the opposite. The five sparse lines that TUI issued about Rath, however, left enough room for all sorts of speculation. Perhaps TUI's Hotel Business Manager Karl Pojer was simply offended.

Kempinski could also use a good lot of new heads. The number of employees fails to keep up with the pace of rapid expansion. In Munich, we met a self-critical Chris Hartley, who had to promote the new Turkish hotels by himself, as the Director there has already left again.

And last but not least, here in this country, a yet unknown head has thought about the future of his hotel management company. The glass noodle producer Ho Kwon Ping is expanding his Banyan Tree Hotels & Resorts almost explosively. There is definitely an unusual strategy behind that.

Here is wishing you a week free of headaches,

Yours, Maria Puetz-Willems
Editor-in-Chief


My e-mail: maria@hospitalityInside.com

Dear Insiders, 

Our simple question "What CEO and what travel company has a positive image?" was answered by only 15 from a total of 30 people questioned. We sifted out press speakers that would have very much liked to have named their own boss. Some managing directors or chairmans abstained from giving a response, either because only negative examples fell to mind or they held themselves to be the best. But for all that the remaining names are no less interesting. The reasons for their being cited anyone can think.

Interestingly enough Kurt Ritter, CEO of Rezidor SAS Hospitality, cropped up in the responses we received. Without knowledge of this, however, or even to have had slightest inkling that he might be named, we'd asked him three days previously if he would be willing to give an interview. Of course he stood promptly at disposal and the "PR Package" Kurt Ritter was lassoed for this edition within 12 hours.

Behind this little survey was a little more than first appears: a study undertaken by the Free University of Berlin took a closer look at the CEO in corporate communication through all walks of industry. The results - in summary and in full in the attached PDF - are open for comparison for each hotel group.

Interesting tips for hoteliers are to be found in a second study on Football World Cup sponsorship. The study names the cities that will profit from the fan boom.

One of those cities in Munich, but the Bavarian capital attracted the attention of the German hotel industry last week for another reason: In Dorint Sofitel Bayerpost the Dorint AG general meeting took place. The hotel group has not emerged from the red and now more radical action is on the cards. Disappointing: The alliance with Accor has not brought the desired success.

For the first time the French, who have certainly been spoiled in the German market up until now, seemed to be banging their heads against a brick wall. Guests repay confusing brand politics by quite simply staying away and internal opinions on how to solve these sales problems are anything other than harmonious. Two company cultures clash against each other - as once the case with NH Hoteles and Astron Hotels. With Accor and Dorint then things remain tense. Accor can no longer simply pull out. It is simply just too involved. Accor boss Espalioux can think himself lucky that France's stock market speculators can't quite estimate the full extent of the ongoing financial crisis of its German partner. The German trade journal "FVW" signed Espalioux off last week, albeit a little too hastily. On 6 September the supervisory board will convene in Paris. Espalioux's contract extension then stands to debate.

Have fun reading this edition. 

Yours, Maria Puetz-Willems

Editor-in-Chief


Please, write to: maria@hospitalityInside.com

Dear Insiders,

Today, our issue revolves around money or strategies. And around employees. About badly trained ones in spas and unfairly treated ones in the echelons of management. Not every manager likes to talk about the issue of remuneration and his bonuses, but the few comments definitely reflect the trend. It is a "hot potato" for sure, as we learned during our research work. In future, we will shed light on this topic in further facets. 

I recommend the spa management of Kempinski St. Moritz to read hospitalityInside.com thoroughly. In our column "Health & Wellness" you will find, for example, the spa standards of Leading Hotels and other useful tips for operating a "well-being area". At any rate, our experience report substantiates "bad conditions" in that spa! But many hoteliers do not see that, as their management by walking around finishes off in front of the spa. 

In the interplay of money and strategies, sometimes one thing outweighs the other and vice versa. Starwood Capital has just invested money and is currently working on a strategy for Europe, as the US company reports directly. Its budget plans could indeed become the "bone of contention" regarding a dismissal of Accor's head Espalioux. At the moment, there is no news from the Parisian rumour mongers.

As summer time means travel time, we also turn today to the hotel interests of German tour operators - the "secret hoteliers". There, new facets are opening up in the strategies as well. 

Arkona AG entered the market with innovative ideas. It wants to generate synergy effects between the attractive resorts on land and river boats. A good concept - in practice, however, a good many things already had to be adjusted, as our article shows. Recently, there have been quite gentle but steady voices of insiders claiming that Arkona was "swimming" financially. From the business report 2004, this cannot yet be deduced, even if its publication was carried out three months later than in the previous year. At best, it is possible to deduce this from the comments coming from the company itself, which were: "The opening in Kitzbuehel in December is the moment of truth!" What the insiders mentioned claim to know better: "The moment of truth will already be there after Travemuende!" The opening of that hotel will take place next month.

Enjoy an informative insight into the game of money, strategies and employees.

Yours, Maria Puetz-Willems
Editor-in-Chief


Comments? Please! maria@hospitalityInside.com

Dear Insiders,

For the first time since the announced restructuring of its brand structure, InterContinental talks about the plans regarding its brands to German media. Robin Wicks, the new chief of operations in Europe talks about the new targets in franchising as well as about the new sales structure that is no longer attached to individual regions. One’s stomach still feels queasy when thinking about replacing personal contacts onsite by an telephone service because of the extremely fierce competition. But InterConti has decided to do so. The cost pressure is definitely breathing down the group's neck. "We are turnover deliverers" - that is definitely the most important symbolic statement made by Robin Wicks. But his willingness to do an interview shall be expressly praised here: InterContinental belongs to the kind of global chains that have difficulties in dealing with the press.

Regarding our research for the second part of our topic "best prices", an online hotel portal had to be asked twice until it delivered all the required information. Luring with so-called best prices that are not so in reality, borders on untrustworthiness in individual cases. The main thing is that the best price button is in the web! The main thing is that competitors notice that one is going along with it! The customer? Oh damn, that annoying guest is there, too. Not to worry if he does not understand it. He is only supposed to click on that button and book... The topic regarding best prices finally leads to a completely different discussion - to the fair treatment of customers.

The managers of the web portals would certainly be an "open book" for Walter Rotter. The coach evaluates characters and leadership abilities based on the date of birth. Sounds like magic, but seems to be quite realistic. Every coach would like to have been an uninvited visitor at the opening of the new Maritim Hotel in Berlin - a mega hotel that had to overcome one mishap after the other. A writing guest reports. The Maritim Berlin has only 505 rooms - the new hotel in Dubai that will soon be operated by Maritim has 1050 rooms. Oh dear.

Today's issue is a summer potpourri made up of all kinds of news and stories. Media that do not provide such diversity in the midst of the silly season are pouncing on rumours instead. The reporting about Accor and the dismissal of CEO Jean-Marc Espalioux are good examples for gap-filling journalism. At first, a French newspaper reports about rumours - only a little bit at first, then a little bit more. And then the first article appears in Germany, in the "Welt". Then the "Sueddeutsche Zeitung" generates a three-column article out of it and finally, the "FAZ" issues a four-column hype article with a mega photo.

hospitalityInside remains slim and fresh. Without losing touch with the changing developments.
Have a great summer week!

Yours, Maria Puetz-Willems
Editor-in-Chief


Your comments? maria@hospitalityInside.com

Dear Insiders,

in the last days hotel veteran Horst Schulze made the headlines. The first time with the announcement of his new hotel chain Solis and a second time a few days later - was this really coincidence? - two business partners accuse the former President of Ritz-Carlton of million Euro fraud… Alleged is improper conduct concerning negotiations surrounding the Lanesborough in London.

Perfect world, perfect imaginary world of hotels. They're so close together. The good and the bad are again making headlines. At least Georg Rafael isn't part of the new plans of his former Regent partner  Bob Burns, who, at 76 years of age, is to try his luck with a new range of boutique hotels in Asia. We reported. "We've lived our lives together," says Rafael of Burns' plans in a chat with hospitalityInside and flies off to a five week holiday in Hawaii.

Jean-Marc Espalioux, the Accor-Head, is also currently on holiday. But whether the holiday spirit improves on account of the rumours circulating the French media? Both Accor fathers, Paul Dubrule and Gérard Pélisson allegedly want to replace him along with four other board members. The newpaper "Le Point" has obviously found their summer headlines and gave the whole affair more fire this week with a further speculative article. Such rumours, however, are certainly nothing new and have surfaced on a regular basis in Accor's past. And so we'll wait and see. Accor headquarters in Paris is certainly in no hurry set anything straight.

And another rumour - or already fact? Reto Wittwer seems to have found a new GM for the Emirates Palace in Abu Dhabi. Now the owners of the Sheikh Palace have to take a liking to him. We've done a little research and have asked the Kempinski boss about the disputes in the palace. Abu Dhabi will continue to make headlines with or without Kempinski as up and coming tourist destination. Sheikh Sultan Bin Tahnoon Al Nahyan, the young chairman of the Abu Dhabi Tourism Authority, is a pleasant but prudent marketing representative of his country.

But this edition of hospitalityInside.com doesn't just comprise the people and their personal stories, but also of hard facts: What exactly is a "best price"? We try to throw a little light on the issue that is presently giving Germany a headache. This week our "spa certification" section will concentrate on the ArabellaSheraton and the Starwood Spa Collection. This and a little more today…

We wish you a rumour free week.
Maria Puetz-Willems
Editor-in-Chief


Contact me: maria@hospitalityInside.com

Dear Insiders,

The merger news from last Friday is set to change the European hotel industry: Starwood Capital clearly documented its right to decisively play along in European hotel business with the deal concerning Le Méridien and the Taittinger/Louvre group. Even in Germany the question surrounding the triangle relationship between ArabellaSheraton Starwood and Le Méridien regains interest. We'll look into it soon.

Raffles has lost its roots on the international level: Real estate is being picked up by Colony Capital. The first pieces of information from the discussions "afterwards" are brought to us today fresh from Singapore by Meinhard Huck, Managing Director of the Raffles brand Swissôtel.

The hotel industry is a strange business. Is it pushed forward by the desire to expand or - as this week's edition shows, by the desire to feed one's own ego? Horst Schulze and Robert Burns again launch their own hotel chains. Instead of playing golf, relaxing and enjoying life, the 64 year old ex-President of Ritz-Carlton once again starts a new luxury hotel chain. Among other hotels, the Grand Senior ventures a 348 room house in the still over saturated market in Frankfurt!

And Robert Burns just can't leave it alone either: The Regent founder now also wants to see his own name on the roof: "A Robert Burns Hotel" is to stand out proudly. But at least plans are restricted to Asia and not the whole world. Whether the managers of the "silver generation" have correctly weighed things up as they stand today? Since Ritz-Carlton's and Regent's heyday market conditions have changed drastically, and things have sped up considerably. Their good name will in the worst case at least ensure one thing: that the houses quickly find new management or owners.

It's understandably a pleasant change to speak with a modest and quiet manager like Giuliano Guerra. His Travel Charme group expands with extreme care. And the investors like it. Till now, very harmonious businesses have emerged with consistently positive margins. Similar success is to be expected from the first Travel Charme hotel outside Germany. Even there Guerra has refused to create one single superlative artificially, but has looked, searched and thought about things so long until everything fit into place. A good deed in such hectic and pessimistic times.

hospitalityInside offers in many regards a solid base of knowledge. From today we will help you to find your way around amongst the complex field of specialist terminology: We will begin the "hospitalityABC". We will start by introducing new terminology and will put this to practice. Dictionary definitions would simply be too easy! If you have problems with specialist terms or simply aren't familiar with them, write to us. We'll certainly try to help.

Have fun reading and surfing through the news from this week…

Yours, Maria Puetz-Willems
Editor-in-Chief


My e-mail address: maria@hospitalityInside.com