Getting the right mix

Operators attaching their names to mixed-use projects for a one-stop solution that can reduce risk, guarantee guests and boost brand awareness are warned not to commit too quickly. Louise Birchall reports.

The current market is a tempting place for opportunistic hotel chains that have identified falling construction and property prices as a chance to place themselves at the centre of some of the region’s mega projects.

However, rushing in could weaken a hotel’s brand image and even compromise the success of the development, according to experts.

Firstly, when it comes to mixed-use developments, getting the right mix is essential, according to Abu Dhabi National Exhibitions Company (ADNEC) business director Sanjay Tanna.

Tanna, one of the brains behind the development of Abu Dhabi’s Capital Centre — a 23-tower micro-city and hotel project — says it is crucial to get the correct combination of hotel brands to complement each other and each of the functions of the development.

The fully-interconnected, exhibition and lifestyle destination called Capital Centre will house a mix of residential, commercial and serviced accommodation.

Choosing the perfect hotel brand to operate floors 18 to 35 of Capital Gate, an integral part of the centre, comprising an 160m tower with an 18° lean (five times that of the Leaning Tower of Pisa) and more than 20,000m² of luxury office space was not an easy decision for the company.

“We approached numerous operators, but we felt Hyatt was the perfect marriage between ADNEC and the operator. There were no other Hyatt properties in Abu Dhabi and the brand fits in with the environment,” says Tanna.

Similarly, the four-star, 400-room aloft Abu Dhabi hotel integrated into ADNEC and due to open in October will mark the brand’s entrance into the Middle East. Its ‘hip hotel’ image was thought to appeal to young people increasingly travelling to the UAE capital on business, explains Tanna.

Other confirmed Capital Centre hotel brands include Rotana, Millennium, Westin, Aruba, Hyatt and Starwood’s extended-stay product Element, with more to be confirmed over the next few months.

“It is absolutely critical that the right brands come into the right area. For example, there are some brands which would not be applicable to the Capital Centre; you need to get the right mix because that is what makes the development successful,” reiterates Tanna.

Making it work

“The location and function are the most important considerations for hotels looking at mixed-use developments,” agrees Sherwood Independent Property Consultants commercial manager David Schuin, who has worked on various developments in the UAE, including an office, hotel and retail space in Business Bay’s Crystal Tower and Jumeirah Lake Towers in Dubai.

“A hotel in Business Bay may not be suited to leisure guests, but if it’s on the waterfront it’s a different story and they may come to stay there,” says Schuin.

One year away from completion, Crystal Tower features office space on the first 15 floors and situated across floors 16 to 32 are hotel-operated serviced apartments, with a basic retail and coffee shop on the ground floor.

Single buildings with different functionalities — commercial, retail, residential and hotel — is just one concept under the mixed-use development umbrella and it’s a popular one in the Middle East, with iconic buildings like Emaar’s Burj Dubai leading the trend.

However, for the concept to be successful, operators need to ensure the product design is tailored to the consumer more than ever.

“You’ve got to think about how the logistics of people coming in and out of the hotel all day will affect the living and working environment,” says Schuin.

“A hotel that is located within a building containing offices should not label itself as a resort; this gives the image of kids running through the corridors — the last thing businesses would want,” he adds.

Schuin recommends that mixed-use developments under one roof should stick to business or leisure. However, there are occasions when a combination can work, he says; it’s all in the design.

He cites hotels such as The Monarch Dubai and The Shangri-La Hotel Dubai, which have all the hotel, office and serviced apartment components, as examples of how to do it properly.

“What they’ve done is create and separate different entrances and accesses for each component,” points out Schuin.

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