Editorial
Dear Insiders,
Olivier Chavy has been CEO of Mövenpick Hotels for 100 days. Now, he talks of his plans and market assessments. Interestingly, he's open for everybody showing interest in the group and for groups which Mövenpick would itself like to acquire. The brand is currently giving itself a makeover, innovative ideas are being tested. Mövenpick is to become more relaxed and more of a lifestyle brand. He is also thinking about a second brand. In my opinion, he should leave this alone. After all, Mövenpick - the brand with a seagull in its logo – has made such a name for itself, that even German-speakers are misspelling "Möwe" as "Möve"...
In Italy, the market is again becoming more transparent and attractive. The country is recovering rapidly. More and more international investors are knocking at the door, especially in Milan. However, the hotel morsels are often too small for the interested funds and HNWIs. At the same time, Italy relies on many private owners who are often prepared to resist difficulties longer than a fund. Massimiliano Sarti on the current trend.
At the "International Hotel Investment & Design Club Forum" held in Vienna's renowned Hotel Sacher in November, conversation turned to the new upswing in Eastern Europe which - just like in Italy - is attracting international investment. Croatia in particular stands out and so too the resort segment. That will remain an issue in 2017.
Airbnb is increasingly being forced to wrap up warmer: Paris has now forced the P2P platform to post its revenue statistics. This will be the basis on which the company is then taxed. An alarm signal is also sounded from Switzerland: There, Airbnb is again pushing further into the hotel market.
Just four weeks ago, the German Airbnb clone 9flats acquired the competitor Wimdu - and shortly afterwards sold it on to Novasol. With this, Wyndham now also has a P2P platform in its vacation network.
News from the real estate world: Soravia Capital in Austria wants to dive deeper into the sector and to this end has set up its own Hospitality Development AG and seeks to attract investment with a new model. And an unusual experiment is being ventured by 81 luxury companies based in Paris. They introduced wealthy guests to the city through experiences which can't be bought with money. This way, they hope to become ambassadors for the terror-plagued city. Enjoy reading more… Until next Friday and our last edition for this year.
Yours, Maria Puetz-Willems, Editor-in-Chief
Your opinion? maria@hospitalityInside.com
Dear Insiders,
The wave of mergers continues to roll over us: AccorHotels has now secured itself a stake in the Banyan Tree Hotels. But doesn't this torpedo the top hotels of Raffles and Fairmont in Asia? It remains an interesting field. Gaurav Bhushan, Global Chief Development at AccorHotels, answered our questions on an ad hoc basis yesterday.
The Chinese will also keep us holding our breath with their 'octopus' strategies. But they won't talk about them much. Prompted by the "China Market Day" by Pandox in Stockholm, we asked three China experts and a Chinese EHL student what Chinese companies think of investment outside China, about Europeans, about employees and about culture clashes... Prof Wolfgang Arlt from the research institute COTRI, Jileen Loo from CBRE and Cornelia Kausch from Pandox provide their insight.
The extraordinary reception of the new Elbphilharmonie in Hamburg also benefits the integrated Westin Hotel, though brings with it challenges of its own, in particular with regard to infrastructure. Last week, we reported briefly on the official opening - today we provide more comprehensive reporting on the choice of the Westin brand, the lack of a fine dining restaurant, the shortage of parking and the full-to-bursting visitor terraces.
The new "Lausanne Report", which is now online, focuses on future scenarios; experts at the World Travel Monitor Forum in Pisa concentrate on the Sharing Economy. This and more in today's edition.
Just three weeks until the end of the year. How many mergers/equity participations have we yet to experience before then? In the run up to Christmas, the question as to the rationale behind many company mergers poses itself.
Yours, Maria Puetz-Willems, Editor in Chief
Your opinion? maria@hospitalityInside.com
Dear Insiders,
With the official opening of the Westin Hotel Elbphilharmonie Hamburg on Wednesday evening, the long wait of the Schoerghuber subsidiary Arabella Hospitality and of Starwood Hotels has finally come to an end. 13 years after the first design presentation was made, the hotel now benefits from a crazy storm of visitors to the new concert house: each day, 9,000 visitors head to the public "plaza" at the Elbphilharmonie, and some also find their way into Westin's "Bridge Bar" too. General Manager Dagmar Zechmann now markets "views with a room" instead of "rooms with a view" - thanks to this grandiose cultural monument, which is certainly one of the most stunning of Europe's landmarks. A first impression today, more next week.
"AccorHotels will pamper us," 25hours CEO Christoph Hoffmann and co-shareholder Prof Stephan Gerhard said of their new 30% liaison with AccorHotels: "We are already a lifestyle group". Just how these creatives will sit with the chain in future, and how the unique deal came into being – this is revealed in an interview today with the two of the original three shareholders, with their characteristic humour and with unshakeable confidence.
Whilst some silver-plate their brand, others cling just as hard to their original ideas. Susanne Stauss interviewed the operators Ruby Hotels, Rilana, prizeotel, Gambino Hotels and the resort brand Arborea - all German companies. And Germans are renowned for sticking to their brands. "I'm looking for a different type of return," they all say.
Macy Marvel returned from a finance conference in London with concrete statements from British hoteliers on the impact of Brexit: Already there are signs of considerably higher wage and food costs, and substantial price hikes for imported washing machines and fridges. All negative consequences of a weak pound. Worse though is the labour market: At Christmas, qualified chefs are lacking.
The Marriott brand package is now fixed: It will stay at 30 brands, though they are now sorted into four segments Luxury, Premium, Select and Longer Stays and then into sub-categories. Barcelona has finally reached the end of its tether with false promises and has slapped Airbnb and Homeway each with a €600,000 fine for listing unlicensed apartments. The two Asian rivals Shangri-La Hotels and Taj have now decided to pool their loyalty programs. And according to the World Travel Monitor, the strong US dollar has boosted demand for foreign travel among Americans.
This and more in today's edition which I edited yesterday from the top storey of the Westin Elbphilharmonie with a spectacular view of the harbour, complete with shipping horns and an impressive sea of light in the evening hours.
Yours, Maria Puetz-Willems, Editor in Chief
Your opinion? maria@hospitalityInside.com
Dear Insiders,
Does your hotel property wear the label "German" on its roof? Then you will probably get a good price for it at the moment. If you are clever, you can try an off-market deal. Bidding processes are developing into fierce combats with inflated prices. This is not my opinion but rather what I gained from conversations with renowned consultants, lawyers and investors. The real estate industry is in its year-end frenzy and is speeding from deal to deal. Nonetheless, others remain cool: 2016 is not comparable to 2007.
Airbnb now offers two kinds of "experiences": those travellers got automatically and for free up to now, when they stayed with locals and these people told or showed them things to know or funny things in the neighbourhood, just out of friendship. Last Friday, Airbnb presented "Trips", a whole world of colourful experiences. But now, these experiences – excursions and activities – are labelled with a big price tag. By doing so, Airbnb risks its USP and drifts off into the exchangeable world of OTAs... Also because the business even wants to offer flights and other services in future. Sarah Douag struggles to keep seeing the uniqueness of Airbnb, even though its new app looks splendid.
Fred Fettner, for his part, put on an entirely different pair of glasses: namely virtual reality glasses. At the "VR-Summit" in Salzburg, he met known experts from the virtual world, who talked about entertainment with drama and eye tracking, amongst others. Disguised as Virtual, Augmented or Mixed Reality, this is all finding its way into tourism gradually.
Austria and Switzerland still have a lot of room for Serviced Apartments, was the message at another conference Susanne Stauss attended. In the world of OTAs, Booking.com, as of late, is also flirting with travel agents and is offering hotels the possibility of transmitting updated contents and pictures even faster now. This year so far, Asians travelled more than ever before. However, they are slowly starting to prefer beach holidays over city sightseeing tours as the last World Travel Monitor reports. In 2016, most Germans chose a holiday home in their own country, another study says.
In exactly four weeks time, it is Christmas. Please don't become breathless – as reflection is very important in a time where reality, reality shows and virtual worlds are merging increasingly.
Yours, Maria Puetz-Willems, Editor in Chief
Your opinion? maria@hospitalityInside.com
Dear Insiders,
Brexit and Trump, terror and war are slowly having an effect: The expectations are decreasing everywhere for 2017; some places even show signs of stagnation. Whether World Travel Monitor or global business travel analysis or Brexit voices at WTM London last week, scepticism and caution are gaining a foothold everywhere – even if STR forecasts a quite strong year 2017 for the European hotel market at Deloitte's conference last week.
But, the entire environment has become much more fragile, everybody feels that – even if the Deloitte speakers say that the cycle will last 18 more months, at least in Continental Europe. But this was, as said before, an estimation before Trump got elected.
Therefore, the results of the fall survey of our INVESTMENT Barometer in cooperation with Union Investment are fitting: In the booming real estate industry only a small majority wants to take more risk to keep the yield stable, while nearly as many people surveyed prefer a lower yield including less risk... You will find the public evaluation on our page 1, our subscribers will find a more detailed version in the magazine and the whole evaluation will be sent to the participants.
Do you know MOOCs? Massive Open Online Courses? In the hotel industry, word has apparently not got round yet that businesses could include this – in most cases still free of charge – online advanced training in their own career support schemes. Top-class professors of renowned international universities are sharing their knowledge this way in the meantime. Baerbel Schwertfeger describes examples and names the most important platforms.
Only recently did I get a glimpse at the bigger picture in Berlin, where Uber's Managing Director for Germany answered to a small circle. At the end I was quite disillusioned: Here, "sharing" is only a disguise for a long-term, uncompromising capitalistic strategy for the domination of large market shares. Uber does not want to drive cars, but wants to make them drive autonomously – without redundant people… And this model is already scratching at the doors of the hotel industry and gastronomy.
Yours, Maria Puetz-Willems, Editor in Chief
Your opinion? maria@hospitalityInside.com
Dear Insiders,
The Trump shock runs deep. I was in London on Wednesday morning where I looked round at 400 incredulous faces at the Deloitte Hotel Conference. The CEOs of Hyatt and Mandarin Oriental, Mark Hoplamazian and James Riley, were the first to cautiously express their dismay as well as their opinion on the consequences for tourism. Visa restrictions would be a real handicap, not only for travellers, but also for the attitude of staff. But who knows what's to come. Compared to the Trump tsunami, the British see Brexit as a tremor. A picture of the mood on Wednesday.
By contrast, the mood at the AccorHotels headquarters in Paris on Monday was the best. Champagne glasses clinked before the media with 25hours CEO Christoph Hoffmann - the new 30-percent associate. After the Luxury Division, AccorHotels CEO Sebastien Bazin is now set to found a Lifestyle Division. And in July, the company's transformation is set to continue, he told hospitalityInside in a short conversation on the fringe of the announcement.
Pan-European owner operators also discussed their expectations and results at the Expo Real. They obviously all achieve better results when they keep control of operations. This article concludes our reporting from the Expo Real hotel conference.
F&B professionals also love to take the broader picture. Internationally active hoteliers and restaurateurs today consider outsourcing, concepts, ambience and sales drivers.
Marriott CEO Arne Sorenson announced the first concrete results and top priorities after the merger with Starwood at the Q3 analyst call. Airbnb has suffered a legal setback in San Francisco; and there are also new figures on London and Amsterdam. prizeotel – in which Rezidor holds a 49%-stake – has signed its first hotel outside Germany. And the meeting and event sector will continue to grow globally.
I wish all of us a pleasant week, without any further shocks or catastrophes.
Yours, Maria Puetz-Willems, Editor in Chief
Your opinion? maria@hospitalityInside.com
Dear Insiders,
Munich has a cold. Results from the hotel industry have waned this year. Terror and amok have left their mark, but these are the only things weighing on the Bavarian success story. All hotel categories suffered at the Oktoberfest. This was just the visible highpoint of the first nine months. Munich's hoteliers report. Guests are now shopping for the best hotel rates.
Resorts are now heading into a new – delicate – bloom period, even in the season-restricted Germany/Europe. A talk round at the Expo Real was encouraging: Finance is back and there are new operators and brands.
Italy, the target market for international hotel groups is slowly also breaking cover. There is certainly enough interest for projects, but the country must first scale back its bureaucracy. Certain destinations promise high prices though. Massimiliano Sarti met Italy fans and Italy sceptics.
One year after the introduction of the Macron Law in France, hoteliers have still not freed themselves from the OTAs. Booking.com is obviously still attempting to push through with its own terms - which EMEA boss Peter Verhoeven denies in a short interview with us.
The French trade unions have also struggled to overcome the tourism disasters of this year: Only a miracle can help them out of this crisis. Paris is therefore thankful for a €23 million rebound plan from 2017.
For the first time, the German real estate sector is looking for start-up ideas for the world of tomorrow, German tourism representatives have successfully secured a change to the Package Holiday bill, and Austria's popular holiday region Tyrol is happy to record strong growth in summer business. And a British private equity company has acquired the German Welcome Hotels, in future headed by CEO Christian Kettlitz.
Yours, Maria Puetz-Willems, Editor in Chief
Your opinion? maria@hospitalityInside.com
Dear Insiders,
The hungry Chinese meet greedy locusts: HNA meets Hilton. The 25%-stake taken this week by the Chinese conglomerate in the world's best known hotel group could be viewed soberly as merely further proof of global consolidation, but: HNA is meanwhile spreading its tentacles in the international hotel business - and is already searching out its next targets before the first ones have even been fully digested. These deals are not yet complete, some pending before court. Jin Jiang shows a similar pattern: It puts out its feelers, ventures small investments or makes a big purchase straightaway. Why must Western companies, on the other hand, be subject to strict controls and limits in China when setting up their own businesses/participating in existing Chinese enterprises? It simply looks like the Western hotel industry has been bought up - though it has to be said, this too is of the West's own choosing. Blackstone has approved the release of its Hilton stake for consumption. Locust meets octopus.
It's the small news that often provoke the most questions, but our reports on hotel performance in Greece and Italy show that there's a lot of discussion there, too. The Greeks haven't managed to use the season to the best of its potential in 2016. And potential this very beautiful travel destination certainly has - the interest in international brands is unabated.
Another type of helplessness prevails in Italy, as it became clear at the Tourism Investment conference. As was once the case in Germany, too many family companies cling to their own brands and their own expertise. Only a few of the national operators stand out - and grow. The international brand hotel industry has a hard time in such a complex national structure.
Chains are occasionally outmanouevred even in Germany though, a market used to chains. For instance, when small budget companies show themselves to have an excellent knowledge of micro-markets, find a good location and have a punchy concept and well-conceived plans. Four such brands are Letomotel, Cocoon/Buddy and MQ, who left a good impression at the Expo Real conference - alongside the giant Plateno with its new soft brand PAI.
New York has now put Airbnb on a tight leash and keeps it in check with the threat of high penalties - when will other cities introduce similar measures? Yesterday, Airbnb surprisingly gave in. This is an issue which massively affects the markets and will keep us holding our breath. And this too: German tour operators have seen revenues fall by over a billion over the past travel year; travel flows are changing significantly. In the Alps, winter business remains much more important than summer business, even if climate change and Alp-bashing might suggest otherwise. HRS is the first OTA to design an app allowing the guest not only to book, but to pay, too.
What you don't have to pay for though is if you participate in our Investment Barometer for autumn 2016. We make it easy for you: just one click! Simply follow the description in this morning's newsletter. Participants will receive full results by mail in three weeks.
Yours, Maria Puetz-Willems, Editor in Chief
Your opinion? maria@hospitalityInside.com
Dear Insiders,
Hyatt developer Peter Norman explained the cardinal error the hotel industry makes with regard to Airbnb & Co: There's a lack of excitement in the industry – it's too uniform and has become too standardised over the years. And whoever has analysed the short term rental platforms, as Hyatt has done recently, sees the next fights coming. Just how deeply P2P platforms have impacted on day-to-day business of project developers has been experienced by GBI Chairman Reiner Nittka with respect to his own serviced apartment projects. Almost everyone demanded national or municipal regulation, but the cities don't have it easy, as Munich councillor Christian Mueller explained. Read today the second and final instalment on the exciting Expo Real talk round on Airbnb & Co.
Meanwhile, the wave of mergers and acquisitions in the hotel industry continues unabated – a development which in my opinion will make Airbnb stronger rather than weaker. Yet the merged companies focus initially only on their own economy-of-scale, which only drives managers like David Etmenan from Novum forward in accordance with the motto "bigger, faster, better"... Industry veteran Ingo Peters from Fairmont Hotel Vier Jahreszeiten, on the other hand, sees the world with its finer differences. The Expo Real discussion on mergers revealed both positive and negative elements.
Anyone looking to test his or her own resilience might wish to oversee expansion in Africa. The continent plays by its own rules, though reveals incredibly positive results and enormous potential. There's a lack of branded hotels everywhere.
Peninsula is positioning itself exactly where there are already many luxury rivals – and it wants to be even better – which indeed the small chain often manages. COO Peter Borer and the new General Manager of The Peninsula Paris report of the group's newest projects and challenges.
Karl Lagerfeld is still challenging himself at the age of 83: Let's see how extravagant his own hotel group will then be. In comparison, Deutsche Hospitality performs only a little brand cosmetics on its Intercity Hotels, as was announced yesterday at a press conference. In Austria, it's snowing new hotels, exactly on time for winter, and in Spain a new brand for "quiet" hotels is to be established.
Our Investment Barometer in collaboration with Union Investment is still running. Have you already taken part? We would be very pleased if you do as the opinion of market participants is important - especially this time where we ask about your yield and risk expectations. Log in here!
Yours, Maria Puetz-Willems, Editor in Chief
Your opinion? maria@hospitalityInside.com
Dear Insiders,
Across the globe, the hotel industry suffers much less as a result of Airbnb than the housing market! That is the core statement from a long discussion at the Expo Real Hotel Conference last week in Munich. The panel was made up of distinguished speakers, including Airbnb critic and activist Murray Cox from New York as well as representatives from academia, from project development, from the cities affected as well as from the hotel industry. Facts presented by researchers refuted the story as put forward by Airbnb and showed just how significantly the giant had penetrated the most popular tourist destinations – and also how it is biting at the heals of the hotel industry. We have prepared the first instalment of our report on this issue for you today. Part 2 will follow next Friday. Once you have read both, dear hoteliers, you will certainly stop your lamenting over Airbnb!
Airbnb and Wimdu were both invited to the discussion, but neither responded. Since last week, we know what Wimdu's reason is: The former number 2 among the holiday home providers has been acquired by former number 3, 9flats. Roman Bach, the new Managing Director of the merged company, spoke with me on the background to the deal.
Data analyst STR based in London delivered facts and figures on the European hotel market in a keynote speech at the Expo Real Conference. James Parsons also had some words on Brexit.
Drawing on our conversations with hotel groups at the Expo Real, we have also summarised the news, inter alia from IHG, der Patrizia, Moxy, Zoku, TUI, Motel One and The Student Hotels. Further, real estate consultants and brokers presented their current transaction figures for Germany at the end of the trade fair. Even institutional investors are moving in on projects now!
On his return from a hotel conference in London at the end of September, Macy Marvel returned will lots of figures on the Spanish hotel market: Things are on their way up there!
The good thing about trade fairs and conferences is this: You feel the pulse of the market. As reported last Friday, the Expo Real was once again a bubbling hive of activity so that exhibitors at our stand "World of Hospitality" all returned home happy. We have produced two videos for you: Impressions from the Joint Stand and from our networking event "BRICKS & BRAINS". Take a look at our Page 1!
Trade fair statistics for the Expo Real revealed the following: 39,100 participants attended, 11,300 of these were interested in hotel/restaurant real estate – just as many as last year. This shows: The high participation of hotel exhibitors has consolidated this trend. We are therefore already looking forward to 2017. After the trade fair is before the trade fair after all!
And last but not least: Save the date! From 28-30 October, the German chapter of the Cornell Hotel Society will meet in Frankfurt. External guests are also welcome to attend the Saturday morning programme. Further information here.
Yours, Maria Puetz-Willems, Editor in Chief
Your opinion? maria@hospitalityInside.com