Industry Update
Editorial Article 7 May 2005

HVS EMEA Hospitality Enews - Week Ending 6 May 2005

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Emirates Reaches For The Sky In Dubai | You would not expect an airline company to lose interest in altitude merely because it had crossed over into the hotel sector, and Emirates does not disappoint. Reports suggest that the company wants a five-star hotel it intends to build in Dubai to rise to 350 metres, a figure that would apparently gain the property on Sheikh Zayed Road an entry into the top five of the world’s tallest hotels. Expectations are that the US$218 million 673-room property will be finished in 2008. The Sheikh Zayed Road will be the address from early 2006 of the Bavaria Executive Suites, which compensates for its relative lack of height (the building rises to a mere 40 storeys) with its offer of 2,100 suites. The property will be a first in the Middle East for German company Bavaria Hotels International.

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Menzies Takes Glasgow Central | Menzies Hotels has visited Scotland for a second time to bring the number of four-star hotels it has in the UK to 15. The company has paid the Milton family an undisclosed sum (certain Scottish newspapers quote a figure of around £14 million) for the 141-room Best Western Glasgow Milton Hotel & Spa, which has been rebranded as the Menzies Glasgow Hotel. In January Menzies Hotels found a new owner in Nikko Principal Investments, and, its confidence boosted by that £120 million deal, Menzies announced that it would be setting off on the acquisition trail.

A Jolly Sale And Leaseback In Bologna | Italian chain Jolly Hotels has agreed a sale and leaseback deal involving the Jolly Hotel De La Gare, one of two properties that the company has in the northern Italian city of Bologna. Real estate investment group Comest Italiana will pay €24.5 million for the 156-room hotel. Jolly Hotels will make a pre-tax capital gain on the deal of €18.3 million.

De Vere Group Declares Its Interim Figures | De Vere Group’s results for the 26 weeks to 27 March 2005 are almost identical to those of the comparable period of the previous year, with pre-tax profit (excluding exceptionals) just 0.2% higher, at £19.3 million, and turnover down 0.2%, at £154.2 million. Like-for-like RevPAR across the portfolio of De Vere Hotels was up 5.8% and it was 2.2% higher, at £44.21, among the Village Hotels & Leisure Clubs. This portfolio will welcome a new member in Bournemouth this December and one in Hull next February. The company will begin work in south Wales this June on the Village Swansea and currently awaits planning approval to build a Village hotel at Junction 28 of the M62 motorway to the south of Leeds.

Rezidor SAS Hopes For The Business Vote In Rostock | Rezidor SAS Hospitality will be aiming to entice as many German or Scandinavian businesspeople or conference delegates as it can to the German port of Rostock from the middle of August onwards. Such persons make up the target market for the new 247-room, four-star Radisson SAS Hotel Rostock, which boasts a ‘seminar and conference wing unique to the region’. If you arrive only to find all nine meeting rooms full then simply hop on a boat and set a course for the emirate of Dubai. By the time you arrive (and if you could time your arrival for the end of this year that would be ideal), the 251-room Radisson SAS Hotel, Media City should be open.

Taylor Looking To Turn Up In Three Scottish Cities | The Scottish press reports that experienced hotelier Maurice Taylor wants to spend more than £20 million to give three cities in Scotland a hotel each. Work is already underway on an Express by Holiday Inn in Dunfermline, and Mr Taylor is said to be keen on bringing the same brand to Edinburgh. The city of Stirling though would be in line for a Holiday Inn, which would be built in partnership with the Royal Caledonian Curling Club. Mr Taylor is the man behind Chardon Hotels, which is already familiar with the brands of InterContinental Hotels Group and became acquainted with Hilton back in March when Chardon and Starwood Capital agreed to pay £111 million for 11 UK hotels, three of which were in Scotland.

Millennium & Copthorne Has A Steady First Quarter | In its first-quarter to 31 March 2005 Millennium & Copthorne (M&C) saw turnover rise 1.9% to £129.5 million and pre-tax profit before exceptionals climb 87.5%, to £7.5 million: ‘steady progress’ in the words of M&C’s Chairman Kwek Leng Beng. Marketwide RevPAR of £40.88 was an improvement of 4.4% on the comparable period of a year ago. The good work continued into April, with marketwide RevPAR for the 17 weeks to 28 April 7.9% ahead on the previous year’s comparable.

BB Aims To Be King In Oporto | Real estate operator BB Sociedade Imobiliária is set to open the Hotel das Artes this June. But the citizens of the Portuguese city of Oporto must not fret thinking that is the last they will see of their compatriot, for the company is set to return at least three times over the next few years. The Portuguese press notes that work could start by the end of the year on a 171-unit aparthotel in Matosinhos in the north of the city. The second hotel will also have four stars but the third will have five stars, 142 rooms and a beachfront location. Meanwhile, Starwood Hotels & Resorts was to be found in Lisbon at the end of last week announcing the sale of the Sheraton Lisboa Hotel & Towers. Although the company did not reveal how much Sociedade de Construcoes Marope paid for the 376-room property, which Starwood will continue to manage, it noted that it made a total of US$42 million from the sale of this hotel and the 432-room Westin Galleria in Dallas, Texas.

Absolute Share Price Performance Over the Past Week 28/04/05-05/05/05

  • De Vere Group - Bear Stearns felt that the company's current strategy would create value for shareholders in the long term. It keeps its 'Outperform' rating and has a target price of 630p.
  • Millennium & Copthorne - Teather & Greenwood placed a 'Buy' rating and Williams de Broe maintained a 'Hold' rating.
  • Hilton Group - Teather & Greenwood has a 'Buy' rating on the stock
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