Mövenpick Hotels & Resorts recently promoted Marc Descrozaille to president Middle East & Africa, following the retirement of Andreas Mattmüller, who had acted as chief operating officer of the region: an area where the company currently manages 50 properties, with 20 more under development.
HOTELS spoke with Descrozaille about opportunities and challenges of the Middle East, which, after a growth slowdown in 2017, now looks to what lies ahead.
HOTELS: Mövenpick just recently signed a deal to manage the Mövenpick Hotel Basra: CEO Olivier Chavy has said the area is one of the Middle East’s fastest-growing economic centers: what’s are the opportunities and challenge in that market? It’s also a 5-star property: can Iraq’s tourism market support luxury?
Marc Descrozaille: Basra is an emerging economic hub, not only in Iraq, but the wider Middle East. Last year the Iraqi Parliament recognised Basra as Iraq’s economic capital. It’s Iraq’s third largest city, home to all of Iraq’s six ports, and is an administrative and commercial centre. All of the world’s major oil and energy companies are located in Basra and many more foreign companies operate there, with thousands of employees and business people travelling in and out of the city and other nearby areas of Iraq every day. This has led to pent-up demand for 5-star accommodation, which is why opening Mövenpick Hotel Basra (152-key property, which will open this year) makes good business sense.
H: What does the breakdown of Mövenpick’s Middle East pipeline look like? How does the current pipeline compare to the last five years?
MD: We manage 46 properties and Nile cruisers across the Middle East, with 15 hotels more under development, in line with our company expansion target. Mövenpick was recently recognized as the top 5-star hotel company in the Arab world by Forbes in terms of number of hotels and its brand presence. Our Middle East coverage is solid, with successful clusters in Saudi Arabia, the UAE, Egypt, Qatar and Jordan. Our reach also encompasses strategic locations that include Lebanon and on the Arabian Peninsula, Bahrain and Kuwait. As we continue to grow our footprint, our goal is to operate more than 60 hotels in the Middle East by 2020.
H: In terms of performance, how are your target markets doing? What’s the expectation going forward?
MD: Saudi Arabia and the UAE are two of the largest markets in the Middle East and offer strong development potential, as per our pipeline plans. Both countries continue to pump billions of dollars into investments that benefit the hospitality sector greatly and the outlook is positive. In Saudi Arabia specifically, investment in the Holy Cities of Mecca and Medina is already paying dividends for the local and national economy, catering to growing demand from religious tourists.
STR figures consistently reveal that both markets (KSA and UAE) have the largest hotel pipelines in the region and will continue to do so, based on the amount of funds being pumped into projects designed to achieve economic diversification and reduce their reliance on oil revenues. Elsewhere in the Gulf, while development plans are more modest, the improved economic conditions and commitment to diversification plans give us plenty of reasons to be bullish.
H: You’re now filling the shoes of Andreas Mattmüller: what will your strategy with the region going forward look like?
MD: During his 16 years with the company, Andreas significantly contributed to developing and establishing the Mövenpick Hotels & Resorts portfolio in the Middle East and cementing the brand’s reputation as a global hospitality leader. From a development perspective, my strategy is to secure our presence in new territories – locations where we are yet to manage properties such as Abu Dhabi, Alexandria and new areas of Cairo. We have made strong progress in this respect, so watch this space. Another focus is desert resorts, residences or hotels with an apartment component to them.
Over the next months the company will also be rolling out a new cutting-edge cloud-based CRM system, which means we can get to know our guests even better, taking care of them to the best of our ability, and I intend to capitalise on this new technology to the benefit of our Middle East portfolio and beyond.
H: Based on the recent events surrounding Crown Prince Mohammed bin Salman’s lockdown at the Ritz-Carlton Riyadh, is KSA is still fertile ground for development and management opportunities or does it make Mövenpick more reticent?
MD: This is an isolated incident that has no bearing on the Kingdom’s overarching blueprint for economic diversification and development and does not alter our approach to our operations or growth plans in Saudi Arabia in any way.
H: With that said, the company has a number of properties opening in KSA in 2018: what’s Mövenpick’s perspective on bin Salman’s Vision 2030 development plan?
MD: We have been successfully operating in KSA for the past 15 years and manage 11 hotels with six more in the pipeline. We are very confident that both the National Transformation Programme (NTP) 2020 and Saudi Vision 2030 will have wide-reaching positive repercussions as the Saudi Government sets out a robust blueprint for economic diversification and long-term prosperity for the kingdom. The hospitality market will benefit in many ways as NTP 2020 and Saudi Vision 2030 not only map out plans for huge infrastructure projects and the development of many economic sectors, but specifically target the growth of the tourism industry and in particular, religious tourism. To keep pace with demand, the government is ploughing more than US$82.7 billion (SAR310.16 billion) into projects that will boost the capacity of the Makkah Grand Mosque and main airport and improve access to the Holy Cities. This is just one example of how Saudi’s plans for development are robust and will benefit the hospitality market and the economy at large. Mövenpick is well placed to capitalize on this growth.