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Sat 10 Jan 2009 04:00 AM

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Six of the best

The CEO of Six Senses Resorts & Spas is confident his luxury chain will emerge stronger in 2009.

Hoteliers around the globe may be suffering cold sweats as the economic meltdown hits occupancy rates hard, but Six Senses Resorts & Spas CEO Sonu Shivdasani tells
Arabian Businesshe is confident his luxury chain will emerge stronger in 2009.

Even staring down the barrel of the most severe global economic downturn in living memory, Sonu Shivdasani is so relaxed that you could be forgiven for thinking he has just spent a week at one of his own resorts.

"I would be much more concerned if I were selling luxury handbags," smiles the founder and CEO of Six Senses Resorts & Spas, leaning back in his seat. "They just sit in your cupboard and you can do without them for a few years.

You put on the TV and see the economic crisis, and it’s cold outside, so people feel they need to get away from it all.

The same cannot be said of holidays - if anything, Shivdasani believes the need to travel has never been greater. It's a bold statement considering the financial meltdown is expected to hit hotels and airlines hard in 2009. But the Oxford-educated Englishman - who oversees 14 island and hideaway retreats at various locations including the Middle East - insists the outlook is brighter than some are forecasting.

Before the financial crisis, he argues, long-haul and short-haul holidays were the top two priorities for people looking to spend their disposable incomes, followed by luxury goods. Since the downturn, Shivdasani insists that while holidays are still on the agenda, luxury goods have dropped off the radar.

"People feel [holidays are] a return on life," Shivdasani says. "If they have the money in the bank they say, ‘this is the time we need to bond together as a family because it's so gloomy and cold in England or France,'for example.

"You put on the TV and see the economic crisis and job market going up and down with redundancies being announced and it's cold outside, so people feel they need to get away from it all," he adds.

Adding further weight to his argument, Shivdasani recalls a recent conversation he had with Matthew Upchurch, chairman of US travel agent association Virtuoso. The American organisation launched the ‘Return on Life' campaign last year, encouraging people to spend more time travelling with their families and friends.

"In the current crisis, Matthew is saying, ‘if you cancel a holiday this year you have lost that time and it's gone from your life,'" Shivdasani explains. "If you don't upgrade from the old BMW 7 Series to the next one you can always do it in two years time; this won't really affect your lifestyle, but the time for having a holiday is gone forever."

Shivdasani's conviction comes from overcoming several hurdles since launching the luxury resorts and spas operator in 1991. The first test came early on when Shivdasani and his wife Eva tried to buy Kunfunadhoo Island, a remote archipelago in the Maldives, from the government. Despite initial reservations, the authorities eventually agreed to the sale after Shivdasani unveiled his plans to develop the island into a luxury resort.

Getting a bank on board to finance the deal also proved tricky. But Shivdasani put his university debating skills to good use and persuaded a Thai bank to part with its cash. "The good thing about English university is you learn how to think and argue and consolidate ideas," he says. "It gives you that mental discipline, which helped, and you get a good insight into human beings and nature.

Having bought the island, Shivdasani and his wife turned their attention to establishing good transport links from the mainland. With strong crosswinds often sweeping over the island, reaching Kunfunadhoo by sea was exceptionally difficult for holidaymakers. Monsoon season was particularly bad, with boats sometimes anchored for almost two days before the treacherous waters were safe to pass. Seaplanes were eventually introduced to provide safer and more convenient passage to the island.

Challenging the Maldivian hoteliers' apathetic attitude to hospitality was another issue that needed addressing. Indeed, most operators gave little thought to standards and services, with high occupancy rates their only concern. But Shivdasani had other ideas. He was determined to develop a resort that put its guests' needs first.

"The standards and guest experience were terrible for such beautiful islands," Shivdasani recalls. "In the past, the Maldivians looked at the fixed income they could get from beds and accommodation and that was it. Renting rooms was very much a commodity to them, but we changed the ethos to provide the right kind of experience."

After drafting in local contractors to develop the island, dubbed Soneva Fushi by Shivdasani and his wife, the resort was finally opened to the public in 1995. The peaceful retreat with 65 villas surrounded by white sand and tropical palms proved an instant hit, according to Shivdasani.

Private seawater swimming pools, an open-air cinema, star-gazing observatory and top-class facilities including a gym and spa, also boosted the resort's appeal.

Following Soneva Fushi's success, Shivdasani wasted little time launching his second Six Senses resort. The Vietnamese retreat was established in 1997, paving the way for more openings in the subsequent years. Today, Shivdasani and his wife oversee 14 Six Senses resorts and spas in various locations, including Thailand, Spain, Jordan, Oman and Fiji.

The couple plans to launch several more, particularly in the Middle East where the company has a modest presence. In Musandam, Oman, the company's Zighy Bay resort offers rustic villas near a remote fishing village beneath the Hajar Mountains. Meanwhile, Evason Ma'In Hot Springs & Six Senses Spa in Jordan is publicised as an "Oasis in dramatic terrain," offering all manner of herbal and holistic treatments.

Shivdasani and his wife plan to open "third-party properties" in Doha and Abu Dhabi. The first is a spa at the Ritz-Carlton Al Sharq in the Qatari capital, with another set to launch at Etihad Airways' new terminal at Abu Dhabi International Airport.

Other scheduled developments include a retreat near the Dead Sea in Jordan, and a destination spa and beach resort in Oman.

Shivdasani confirms the company is also considering Egypt and other Middle Eastern destinations as possible locations for additional spas - but offers no further details.

Unsurprisingly, Shivdasani is equally guarded when discussing occupancy rates and financial forecasts across all Six Senses resorts. However, he does admit interest in his Thai resorts has waned since the political protests in Bangkok late last year.

"In 2009, our EBITDA will be half of what was forecast and that's primarily because of Thailand," he says. "That country is an exception because it has been affected by the political challenges, but I believe our more unique properties will continue to do well."

In particular, Zighy Bay is expected to attract high visitor numbers following a successful close to 2008. The resort had a soft opening in March last year, with occupancy rates reaching 90 percent by October. Shivdasani believes it will continue to "thrive" in 2009.

"People with the cash that want to go long-haul have to decide whether they would like to go somewhere like Zighy Bay or pay half price for something else," he says.

"Fortunately, because of the uniqueness of the property, we are doing quite well," he continues. "Some people might decide to tighten their belts while others may think, ‘if I am going on holiday it's only $400 extra a night for seven nights,' so they might spend $13,000 instead of $10,000 for example, to get the Zighy Bay experience."

Whether Shivdasani is right remains to be seen, but he clearly believes enough travellers will opt for Six Senses' "more authentic" beach holidays, ahead of the plethora of hotels offered by tourist hotspots such as Dubai.

In recent weeks, hotels in the emirate have slashed rates by up to 40 percent to attract tourists amid the global downturn. Occupancy rates are down, and hoteliers have been forced to offer special packages in order to entice holidaymakers across their thresholds.

"If I was building or opening a hotel on the Palm or Jumeirah beach I would be very worried," Shivdasani says.

"We were offered many opportunities on The World and Palm [Jumeirah] and turned them down on many occasions. Firstly, it didn't fit into the Six Senses philosophy, and secondly we questioned how much you can induce in terms of demand.

"If you take Jumeirah Beach it isn't a genuine experience - there are lots of buildings around and the surrounding area is generally mucked up," he claims.

"People fly into Dubai from all around the world, but if they want the real experience it's with us; that's why I think we'll continue doing really well."

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