What makes Village different from its competitors, and underpins the whole hotel complex, is a firm relationship between the local community and the leisure club. All new hotel sites are carefully sourced: the land must be affordable, and there must be a community of local residents within a five-mile radius. This community then provides most of the leisure club membership, a stable revenue and - perhaps most significantly - the lively atmosphere on which the brand depends.
"Whenever you walk into a Village hotel, there are always about 600 people on site, and they all come in through one front door," says De Vere chief executive Paul Dermody. "Even if only 10 rooms were filled, we would still provide the non-stuffy, vibrant atmosphere which differentiates us from so many other middle-market properties."
The location of Village hotels is matched carefully to the Monday-Thursday corporate market. As well as being close to a local community, hotels are always situated close to a motorway and just outside a city.
"The success of the brand is achieved by finding the right balance of what appeals to our audience of middle-management and leisure customers," says Charles Nicol, general manager at the company's latest property, the 127-bedroom Village hotel in Newcastle.
Despite Dermody's insistence that Village hotels are hotels first and leisure clubs second, there is no avoiding the significance of the leisure business in terms of customer base and capital. The average build cost is 14 million pounds for every new Village hotel, and the leisure club constitutes a reliable injection of capital early on. The newly opened Newcastle hotel has a membership capacity of 5,000 and has already attracted more than 2,500 subscribers since its soft opening on 12 June. Leisure business makes up about 30 percent of overall turnover.
"It is difficult to separate the leisure club from the bedrooms," Nicol says. "The level of membership generated by the leisure club creates the atmosphere on which attracting people into the rooms depends. It is also the driving force behind the restaurant and bar."
Nicol estimates that about 40 percent of room bookings are made by local members of the leisure club who use it for business purposes.
Apart from rooms and leisure facilities, the other essential components of a Village hotel are a restaurant, café and traditional-style pub. "We have a pub instead of a hotel bar because our middle-market customers feel more comfortable in that environment," Nicol says. "It's more relaxed."
Salingers, the 130-seat restaurant in the Newcastle hotel, has an average spend of 12 pounds for dinner (without alcohol). The management is aiming to bring the restaurant into line with other Village restaurants, which average about 100 covers a night midweek.
The expansion of the Village Leisure Hotels brand has not stopped in Newcastle, however. While Dermody admits that he has failed to achieve his goal of two new complexes a year to date, he points out that the new Maidstone Village hotel is due to open next year, and he anticipates a further four in the pipeline.
With occupancy at Villages around the country averaging about 80 percent, and an average achieved room rate of 50 pounds, (standard double rack rate is 98 pounds, or 65 pounds at weekends), Dermody is upbeat. "Village Hotels has broken the middle-market mould," he says.
De Vere Group
De Vere Group is a hotel and health and fitness business with three core and complementary operations: De Vere Hotels, Village Leisure Hotels and Greens.
De Vere Hotels
De Vere Hotels sees itself as an upmarket, primarily provincial, hotel chain, targeted at the conference, corporate and leisure markets. There are 21 De Vere hotels, and 13 of them have golf courses. Most have extensive leisure facilities. Twelve associate hotels have access to the group's marketing and central reservations services. De Vere also owns De Vere Resort Ownership - otherwise known as timeshare. With 15 lodges, De Vere is the UK's largest five-star timeshare operator.
Village Leisure Hotels Since the end of De Vere's financial half-year (15 May), Village Leisure Hotels has added the Newcastle hotel to its portfolio. The group now comprises 14 hotels with a total of 1,216 rooms. Leisure club membership for the group was 52,400 at the half-year end (as against 47,100 in 2001).
The company's interim results saw turnover for Village Leisure Hotels rise 11percent to 31.7million pounds (28.6 million pounds in 2001), while like-for-like turnover grew by 1.9 percent, against an industry decline of 2.4 percent.
Like De Vere Hotels, Village was adversely affected by a change in sales mix from corporate to leisure of 0.4 percent. Overall, operating profit to the half-year end increased by 5 percent to 6 million pounds (5.7 million pounds in 2001) - largely because of cost savings, however.
