While the hotel world increasingly explores the mid-tier market in the Middle East in response to growing demand and government calls for more affordable accommodation, FRHI Hotels & Resorts is forging its own distinct path.
The parent company of luxury and “upper upscale” hotel brands Raffles, Fairmont and Swissôtel has no immediate plans to take the three and four-star route, as its competitors are, but rather is entirely comfortable expanding its portfolio doing what it knows best.
“We’ve given it a lot of thought and we’ve had a lot of conversations around it,” Jennifer Fox, president of FRHI International and its Fairmont brand, tells Arabian Business.
“We’ve decided for the moment to stay in that luxury sector and the reason for that, primarily, is that we still see a lot of growth opportunities for our three brands, so we want to really max out those brands and really get them into all the right markets that they need to be in and where our customers want to go.
“Now, over time we may consider to go into the mid-scale market, but at the moment our real focus is really getting those three brands to all the key markets that we need to have them in.”
To do that FRHI, which manages 110 hotels in 32 countries and has a reported profit in the $100m-plus range, is embarking on its most aggressive expansion with a recently unveiled target to grow its global portfolio by 50 percent in the next five years.
Following what Fox describes as a two-year consolidation period, in which it identified Dubai as one of four new global regional headquarters under a new geography-based operating model, it has also resolved to double its 19-hotel Middle East, Africa and India (MEAI) portfolio by 2020, starting with the opening of both the Fairmont Ajman and the Fairmont Riyadh, Business Gate in the fourth quarter of this year.
Unveiling its plans for seven other projects in the region at the Arabian Travel Market (ATM) in May, FRHI is also embarking on a 7.5 million sq m, three-hotel mega project in Egypt’s popular Sharm El Sheikh, as well as new hotels in other key markets Saudi Arabia, the UAE and Africa.
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