APRIL 2011 |
www.opp.org.uk
THE LAST WORD IHIF INTERVIEW | 65 Developer profi le
inappropriate demographic, and you will waste huge amounts of money trying to attract guests who do not want to stay in that sort of facility in that area.
“Be ruthless,” says global senior vice president David Pepper. “If the research says the area will only get budget travellers, do not build a four or fi ve star resort and hope to pull in big spenders. It just won’t happen.” A franchise like Choice adds a lot of value to the development says Dupont, doing all sorts of things for the franchisee such as marketing, IT, systems, business planning, staff training, an online reservation system and a quality control standard that gives customers peace of mind. The royalty fee back to Choice is normally about 8% or 9%.
And the future? “India and China are very important to us right now,” says Pepper. “Last year we bought out the master franchisor in India. And Brazil is a country that is looking strong in growth terms too.”
But what would a top hotel industry consultant recommend, and where would he or she go to do that next big hospitality property development? Mark Blick, managing director of Soric International is clear. Research hard before making the first move
he agrees, and look for a mixed-use scheme that will attract a strong brand operator.
It is a tough market right now he adds. “Some European hotels just don’t realise that they are in a distressed position,” he told OPP at IHIF. “The banks will only invest if it all makes sense. And the brand is essential.” “A good hotel brand on your scheme will reassure a nervous bank or lending institution, and the brand
“This is very much a property game nowadays ... property is where the deal starts and ends”
will usually guarantee a certain level of performance. Get the story right, back it up with good research, prove that there is going to be a good yield there … and the investors will come in.” Soric specialises in underwriting these hotel feasibility plans and calculating the return you can get. It will source debt and mezzanine debt and broker deals for developers. And, says Blick, “make no mistake, this is very much a property game nowadays. Property is where the deal starts and ends.”
Soric: a case study in Bucharest.
Soric International is currently working on the sale of a luxury hotel development in central Bucharest, Romania, with a world-renowned brand and management company in place. The proposed new-build, 97-room property has been designed in the traditional style of grand European hotels and will be positioned as a fi ve-star plus hotel/trophy asset. ‘‘This project provides an ideal opportunity to become a market leader in the
Bucharest market” says Soric managing director Mark Blick. What facilities will it off er? “It is expected that the property will have 96 rooms, a
presidential suite, meeting room, restaurant and bar. There will also be a large spa, underground parking and a number of retail outlets,” he says. Why this location? “In recent years, Bucharest has undergone signifi cant economic growth, much of it underpinned by a construction boom, with the development of high-rise offi ce and residential buildings and shopping malls,” says Soric.
And what are the wider demographic trends? “The country’s tourism industry
is expected to grow by 6.7% between 2009 and 2018, although currently, business represents around 85% of the hotel market. Condé Nast Traveller magazine cited a similar hotel in Bucharest amongst its ‘hot list’, indicating that demand at the top end has yet to be fully exploited,” he consultancy reports. Founded in 2007, Soric International off ers real estate, investment, branding, operations and related advisory services. Currently, the team is working on deals in Sardinia, Rome, London, Milan, Paris, Marbella, Madeira, Bucharest, Dubai, Cote d’Azur and Vienna. The company has offi ces in Paris, London, Milan and Dubai. A new offi ce is expected to open in Dakar, Senegal, in 2012.
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