Sant Singh Chatwal: King of New York

Billionaire hotel operator Sant Singh Chatwal is bringing a slice of the Big Apple to Dubai. In an exclusive interview with Arabian Business, the Indian-American entrepreneur talks about his rags-to-riches story, and his plans for global dominance
Chatwal plans to tap into the lucrative UAE market by launching his latest Dream hotel in Marina 101.
By Ed Attwood
Fri 20 Sep 2013 10:53 AM

Sant Singh Chatwal is clearly a man that doesn’t do things by half. The six foot one inch Indian-American hotel magnate takes a series of rapid-fire phone calls in the imperious presidential suite at the Oberoi Hotel in Dubai before he sits down to chat. Time is short; Chatwal is due to fly back to the US after a brief sojourn in the emirate that has seen him announce a deal to run the world’s tallest hotel, based in Dubai Marina.

From piloting jets in the Indian Navy to being one of New York’s biggest hoteliers, via the Ethiopian civil war in 1975 and a short stint in bankruptcy, billionaire Chatwal is a master of reinvention. He played an important role in the deal between the US and India that brought nuclear power to the Asian state, is a trustee of the Clinton Foundation, and was given India’s third-highest civilian honour, the Padma Bhushan, in 2010.

Right now, the chairman and CEO of Hampshire Hotels & Resorts is on a mission to extend his portfolio of brands — which include the Plaza, the Chatwal, Dream Hotels and Night Hotels — across the planet. And one of his biggest bets is going on Dubai, where Chatwal says the market can take “at least three or four” of his hotels.

“Dubai has become, in my mind, an international city,” Chatwal smiles. “There’s a big amount of tourism coming, and with the problems elsewhere in the Middle East, where do people go? They come here.”

Chatwal plans to tap into those tourists by launching his latest Dream hotel in Marina 101, a behemoth with 720 rooms and hotel apartments. Dream Dubai Marina is slated to open in the last quarter of next year, and will feature six restaurants as well as a signature nightclub on the tower’s 101st floor. The supertall has been developed by Hampshire Hotel’s joint venture partner, Sheffield Holdings, and its height of 425 metres will make it the planet’s tallest residential building when it is topped out at some point towards the end of this year.

The stats certainly sound impressive, but how does Chatwal think he can compete with the plethora of options available to Dubai’s tourists? “There’s no lifestyle here, apart from the Armani Hotel, and this city needs more lifestyle brands,” he says.

“There’s no competition; Dubai can take hotels like New York can. I have hotels on 16th [Street, in Manhattan], 44th, 45th, 47th, 48th, 49th, 50th, 52nd, 55th and 59th, plus the Plaza — and I’m still not suffering from the competition.

“I’m not bringing a Tom, Dick and Harry hotel like a Marriott or a Sheraton — I’m bringing something new, and a lifestyle hotel draws a crowd. At one of our hotels in New York we created a beach by bringing in sand from Florida; we have beach cabanas there and a rooftop bar with the best view in the world.”

Chatwal’s plan is clearly to leverage his New York lifestyle model and transplant it wholesale into Dubai. He’s in talks with a number of third parties to bring various food and beverage brands over to the emirate, which will include Bombay Palace, the popular Indian brand that he first founded in the US back in the 1970s. Back in New York, the lifestyle section of the Hampshire Hotels portfolio is run by Chatwal’s son Vikram, a former Wharton School of Business graduate and model, actor and fashionista who is a regular feature in the American tabloid press.

“My feeling is that we can have one Dream here in the Marina, and we can have one Dream in the financial centre, and so on,” says Chatwal. “There’s enough room in the market. Look at Manhattan — it’s 17 miles long and three miles wide. You can have 11 hotels there without being hit by competition, and you can do the same thing here, as long as you have a new concept.

“I think that if in New York we could have 11, my strong feeling is that Dubai could have at least three or four, as long as we have that different concept. We don’t want to compete with each other. There’s big demand; occupancies are high, and Dubai used to have seasons, but things are changing.”

Chatwal also sees other opportunities in the Middle East, including in Abu Dhabi and Doha, as well as Beirut and Cairo, should geopolitical concerns abate. If those plans go ahead, they will be in the same vein as the Dubai venture, however.

“We always need a local developer,” he says. “We don’t want to get caught out with rules, regulations, licences and so on. We’d rather have somebody take the local headache — we do what we are best at.”

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Right now, Hampshire Hotels has properties in New York and Miami, as well as in Bangkok and India’s Kochi. The operator previously announced a raft of properties for Chatwal’s home country of India, in conjunction with the Wyndham Group, the world’s biggest hotel operator. The chairman says that while those remain on the drawing board, there’s no rush to get those projects completed.

“We have a couple of projects in Jaipur and also on the beach in Goa, a very good site,” Chatwal says. “The problem with India is that whenever you have an election, which takes place every five years, things become uncertain.

“They have their own internal market, and it’s a great market, but unfortunately they get into all these controversies; there are so many parties, and there is so much speculation in the 18-month period around elections. But that doesn’t stop us — we still have land investments and we can wait and see how things go.”

But flashy plans for Dubai and rooftop bars in Manhattan are a long way from where the Hampshire chairman began his career as an entrepreneur. After growing up in the Punjab, Chatwal spent a couple of years as a pilot in the Indian Air Force. After leaving the military, he decided to go to Ethiopia — “it was a very underdeveloped country and I thought there might be more opportunity there” — where he initially signed on for $3,000 a month working as a pilot.

Unfortunately, as soon as he turned up at the job, he was told to remove his turban and wear a cap, which Chatwal says went against a promise he had made to his mother to always respect his traditions and the importance of the Sikh religion. After a short stint in the Ministry of Education, for much lower pay, Chatwal started managing a local restaurant, Omar Khayyam, after its owner had to travel to the UK for medical treatment.

“I told him I only had one condition [to take on the job] and that was that I could change whatever I wanted in the restaurant,” he recalls. “I replaced all the filthy table cloths, bought some plants, and found the whole business very interesting, from entertaining people to talking to bankers. So the owner came back after six months and found his profits had doubled.”

Chatwal went on to open his own restaurant, as well as buying a farm and opening a school. Now relatively wealthy, Chatwal’s burgeoning business career hit the blocks in 1975, when a Communist-backed revolution overthrew Ethiopia's leader, Haile Selassie and nationalised all private-sector companies. As luck would have it, Chatwal had recently transferred some funds to the US, and he managed to find his way to New York, where he quickly established the now-famous Bombay Palace chain of restaurants.

“I never stopped,” he says. “From New York, I went to London, I went to Hong Kong, and to Canada, and after all these restaurants started making a lot of money I used to pay a huge amount in taxes. So I got into hotels for taxation purposes, and I found the hotel business better than the restaurant business.”

But Chatwal suffered hugely as a result of the US real estate crisis in the 1990s, and was forced to file for Chapter 11 bankruptcy.

“I had to restart my life,” he says. “That’s when I realised where I made my mistake – I realised I needed some institutional partners in the hotel business, so that when the bad times came they could hold me up. If I had had maybe $7m or $8m I could have saved my company, but I didn’t have that.

“So I changed my formula and started having other investors as partners. I knew the art of making money from a restaurant, and my son advised me that the best way to go in the hotel business was through lifestyle. So I followed his lead in that. And we’ve grown quickly.”

Nowadays, don’t bet on Chatwal — now 67 — taking a back seat in the not-too-distant future. He’s still working hard with the Clinton Foundation, helping to provide medicines at cost price to help combat AIDS, malaria and other diseases in Africa and Asia. And he still has big plans in the pipeline.

“I’m looking at Sao Paulo, looking at Hong Kong, we’re very close to finalising a deal in London, and we’re looking at Bombay and Shanghai. We will not jump on it, so we’ll take every deal as it comes.”

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