With 11 MENA openings planned over the next 18 months, IHG CEO for Asia, Middle East and Africa Jan Smits updates Hotelier on the group’s regional expansion strategy
In less than 18 months from now, InterContinental Hotels Group (IHG) will have expanded its Middle East and North Africa (MENA) portfolio by a further 11 hotels, according to CEO for Asia, Middle East and Africa Jan Smits.
Over the next three years, this number of new properties in MENA continues to grow, reveals Smits, who gave Hotelier Middle East an update at the Arabian Hotel Investment Conference in Dubai.
Smits was speaking upon the launch of the InterContinental Muscat Hills Resort in Oman. When it opens in 2015, the project will be IHG’s second hotel resort development to include an IHG-run golf club component, after it took over Al Badia Golf Club operations next door to InterContinental Dubai Festival City back in 2009.
“It’s not a model we necessarily look for but it makes sense. You get a lot of synergy in running both [the hotel and the golf club], but we’re not experts in running golf courses,” explains Smits.
In the shorter term, IHG is on track to launch two hotels in Oman by the end of 2013: the 188-key Holiday Inn Muscat Airport — pushed back from its scheduled 2012 opening — and the 213-room Crowne Plaza Duqum.
IHG had previously launched the InterContinental Blue City Beach Resort, set to open in 2015, however, this forms part of the stalled Blue City real estate development.
The firm currently operates only one InterContinental resort and three Crowne Plazas in Oman, a country that Smits explains has a “lot of potential” for the group.
In Bahrain the outlook is also positive, according to Smits. In spite of recent unrest, the group is forging ahead with developments there, and he confirmed that the Holiday Inn Express Bahrain, in Manama, will open this year.
The group also has two upcoming properties in Al Seef — Staybridge Suites Bahrain Al Seef and Holiday Inn Bahrain Al Seef — which Smits said were continuing in line with the scheduled 2014 launch. IHGs existing hotels in Bahrain are continuing to operate, albeit with lower occupancies and rates.
“The hotel industry’s a very cyclical business. There are cycles; be it political unrest, downturns, natural disasters — different markets are at different stages. Some markets in this part of the world are going through a difficult patch,” comments Smits.
“We’re operating the Bahrain hotels and we continue to support our operations with the owner. Our main aim is to be close to the owner and look after our guests and employees,’ he tells Hotelier.
Time is right in KSA
Meanwhile in Saudi Arabia, the group’s expansion strategy is all about timing.
“Eventually, in Saudi Arabia, we will deploy all of our brands, but first you’ve got to make sure you’ve got enough Holiday Inns, Crowne Plazas and InterContinentals [all brands already present in the KSA market] before you do anything else,” explains Smits.
“In India for example we had a joint venture agreement, putting our own money in, to add 3000 Holiday Inn Express rooms to the market — so it needs to be done strategically — do a few at a time,” he continues.
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