R Hotels new vice president talks to Hotelier Middle East about trends, plans, and pressure
I always wanted to work in the hospitality industry. When I was a child I used to enjoy helping my mother in the kitchen and arranging for visitors to come, which is not very usual for a child. I enjoyed cooking and wanted to become a cook, but I had to finish school and then university. After this, I started in a travel agency and then as a tour operator. It was only at the age of 30 that I met people that worked in the hotel business. Now I have opened hotels, I have done construction for hotels, so all these things I have done.
What are your plans in your new role?
My foremost task now is to stabilise the two hotels which we own. One is a 500 room Ramada hotel in Ajman which we own and are doing the management for. It is a franchised Ramada which is doing quite well, but it is tough to sell 500 rooms in Ajman. We are managing to reach more than 50% occupancy but it is at a depressed rate. We have some operational challenges but we are overcoming them. Then we have opened an apartment hotel in Downtown Dubai opposite the Burj Khalifa, so that is the baby that I am trying to nourish now. We have also signed a contract in Saudi Arabia for 12 hotels to be built within the next five years. We have a few other hotel management contracts where we have been asked to take over existing hotels. I don’t want to go and buy or build hotels at the moment. We would like to grow by acquiring management contracts but we don’t want to really invest in assets for the time being.
Are there any trends you will be capitalising on?
In Saudi Arabia we will really be looking at the limited service sector. They have a lot of five star hotels and a lot of local hotels. And we want to do something for the intra-GCC business and government traveller who is not allowed or not willing to spend the five star hotel prices. There is definitely a demand for budget hotels in Saudi Arabia. All of the hotels we are opening in Saudi Arabia will be budget hotels. Right now people may be staying in local hotels but there will be an interest in an international two-star hotel. We will also capitalise on the amount of Saudis who drive for work and may need somewhere to stay overnight.
Is there a lot of pressure to deliver in your new role?
There is always pressure because people want results in three weeks. It is an old story you know, they are not very patient and nobody is planning for the long journey. They want to see the cash inflow now. In 2008, probably in Dubai, you could make a return in two or three years on a hotel. Now it is going to take more than 10 years.
How do you forecast business will be in the future?
We have big demand; we have July almost fully booked already which is just because of the location. How long will this happen, how long will Burj Khalifa be attractive? I do not know. You had Mall of the Emirates which had the same effect over the last six or seven years and now they’re struggling because everybody wants to be near Dubai Mall, so let us see. I am lucky, I am lucky right now.