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Stephen Frood



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  • 1. Ambassadors Bloomsbury London : 28 April 2010 Stephen Frood Davis Langdon COMPARING HIGH END HOTELS IN LONDON TO THE REST OF THE WORLD
  • 2. Content
    • Introduction
    • Defining high end hotels
    • What are the top hotels in the world?
    • Facts and figures on the top hotels worldwide
    • Market feedback from key Davis Langdon locations
    • London – What will the future bring?
  • 4. How do we define a top end hotel?
    • What makes a top hotel?
    • Range of large guest rooms
    • Substantial front of house facilities (restaurants, bars, banquet, conference, retail etc)
    • Range of back of house facilities to support hotel operation
    • Exemplary service and quality standards
    • Location, reputation and destination status
    • Cost
  • 6. What are the top hotels in the world?
    • Beijing
    • Mandarin Oriental
    • St Regis
    • Park Hyatt
    • Shangri-La
    • Ritz Carlton
    • Singapore
    • St Regis
    • Raffles
    • Ritz Carlton
    • Capella
    • Fullerton
    • Hong Kong
    • Four Seasons
    • Mandarin Oriental
    • W Hong Kong
    • Grand Hyatt
    • Island Shangri-La
    • Barcelona
    • W Barcelona
    • Mandarin Oriental
    • Gran Hotel La Florida
    • Hotel Arts
    • Hotel Casa Fuster
  • 7. What are the top hotels in the world?
    • Sydney
    • Park Hyatt
    • Four Seasons
    • The InterContinental
    • The Observatory
    • Westin International
    • New York
    • Four Seasons
    • Peninsula
    • Ritz Carlton
    • St Regis
    • Hotel Plaza Athenne
    • Paris
    • Four Seasons George V
    • The Ritz
    • Hotel Le Crillion
    • Hotel Le Bristol
    • Park Hyatt
    • Dublin
    • The Westbury
    • The Shelbourne
    • The Fitzwilliam
    • Ritz Carlton
    • The Dylan Hotel
  • 8. What are the top hotels in the world?
    • Cape Town
    • Mount Nelson
    • The Table Bay Hotel
    • The Cape Grace Hotel
    • Crystal Towers
    • Westin Grand
    • London
    • The Ritz
    • The Savoy
    • Claridge’s
    • The Connaught
    • Dorchester
  • 9. What can we take from this?
    • London, Paris, Dublin and Barcelona have more privately owned top end hotels
    • Key emerging world wide locations dominated by the leading ‘luxury brands’ (Four Seasons, St Regis, Ritz Carlton, Shangri-La, Mandarin Oriental)
    • Major European Cities have mature markets and older more established building stock
    • Major European cities maybe have older more traditional hotel stock – the Ritz in London, Claridges etc
    • Selecting the top 5 is very subjective !
    • Lets hold onto these thoughts and return to them later…..
  • 11. Operational performance of top end hotels
    • Occupancy global ranking index 2008
    Source: Deloitte / STR Global
  • 12. Operational performance of top end hotels
    • Average room rate global ranking index 2008
    Source: Deloitte / STR Global
  • 13. Operational performance of top end hotels
    • RevPAR global ranking index 2008
    Source: Deloitte / STR Global
  • 14. Operational performance of top end hotels
    • What Trends can we take from this performance data?
    • 5 cities or locations feature in all three rankings – Paris, New York, Dubai, Abu Dhabi and London
    • These destinations command top room rate, high occupancy and therefore leading RevPAR figures
    • Despite the negative impact of the world wide recession these are still leading world wide destinations – especially for the top end market
  • 15. Design Economics of top end hotels
  • 16. Design Economics of top end hotels
  • 17.
    • What Trends can we take from this data?
    • Far East and Asia Top End Hotels are bigger – bigger bedrooms and bigger public areas
    • Proportion of public areas to bedrooms is higher
    • Bigger emphasis on food and beverage facilities in some of the emerging locations ?
    • Design size and standards reflects land and property constraints in historic and mature locations like London
    • Smaller overall size and smaller guest rooms reflects higher build costs in London (and the USA and Europe)
    • Locations like London can still earn top rates and achieve high RevPAR from smaller hotels
    Design Economics
  • 19.
    • Dublin
    • Top end hotels dominated by privately owned stock
    • 2003 – 2008 saw huge increase in new hotel development
    • Currently a huge over supply
    • 12% drop in visitors in 2009
    • Occupancy levels down to circa 55% (last seen in the early 1980’s)
    • Very low levels of development activity or intent
    Some Feedback from around the World
  • 20. Some Feedback from around the World
    • Beijing
    • Top end market is still very ‘hot’
    • Four Seasons have two new and current hotels under construction
    • Typical size is 50,000m2 with 400 – 500 bedrooms
    • Most have 4 – 5 restaurant options
    • Top end hotels all tend to be new build
    • Hotel fabric and Operators are both international 5* grading but service levels yet to reach 5* standard
  • 21.
    • Hong Kong
    • All top end hotels in the city centre or CBD
    • Shortage of land in the CBD
    • Ritz Carlton to open a major hotel in 2010
    • Food and beverage a major source of income for top hotels
    • Top hotels tend to be surrounded by high end shopping/retail offer
    • A lot of budget hotels now under construction – tend to be outside centre and aimed at mainland Chinese visitors
    Some Feedback from around the World
  • 22.
    • Singapore
    • Top end hotels all 200 – 500 rooms
    • Historically a mixture of new build and conversion (Raffles was a refurbishment and Capella and the Fullerton were conversions)
    • Two Integrated Resorts nearing completion – will release 4,000 top end rooms into the market
    • 6 – 7 further hotels under construction in 2010
    • 2009 was a tough year in Singapore – 20% decline in average room rate for 5* hotels
    Some Feedback from around the World
  • 23.
    • Sydney
    • Current occupancy levels are 80% plus (five major cities in the 2008 occupancy ratings)
    • Probably one of the few world wide locations not to have felt the chill winds of recession
    • Still demand for top end hotels – but short on supply (economics are difficult to make work)
    • Biggest scheme underway is the new 5* Star City Casino Development
    Some Feedback from around the World
  • 24.
    • Barcelona
    • Top hotels in centre are constrained by density of historic core
    • 21 of Barcelona’s 321 hotels are 5* standard
    • 36% of hotel stock is privately owned
    • Between 2006 and 2009 - 36 new hotels were completed, 6 were top end 5*
    • Between 2010 and 2012 - over 50 more are planned but a serious slow down due to the economic position
    Some Feedback from around the World
  • 25. Some Feedback from around the World
    • London
    • Mature market, historic context, high property and land values
    • Top performing location
    • Great tourist draw
    • Backdrop of London 2012 looming
    • Some of the greatest top end hotels in the world but…..
    • A lot of over rated 5* hotel stock
    • A lot of top hotels in need of refurbishment and upgrade
  • 27. London – What will the future bring?
    • 2010 sees some great additions to London’s top end offer – Savoy re-opening, W Hotel (Leicester Square), Four Seasons on Park Lane and the Corinthia
    • Occupancy growth is forecast in 2010 – 2 to 2.5%
    • Room Rate growth – 3.5%
    • 6,000 new rooms under construction by 2013
    London - New Hotel Room Supply by Category 2010-2013f Source: TRI Hospitality Consulting
  • 28. London – What will the future bring?
    • 35% of this supply will be 5* / Luxury hotels
    • Key focus on the City and the West End (in particular Westminster)
    • 5* and Luxury market make for more attractive development propositions
    • Big overseas luxury brands seeking entry into London (ie Shangri-La at the Shard)
    • The future is looking good for top end hotels – both for the construction and property sector and for tourists and business users but…..
    • Some London hotels have much to learn from their counterparts around the world and need to ‘raise their game’ in terms of quality and service standards