Featured in this EMEA Hospitality Newsletter - Week Ending 27 February 2004
IHG Reaps £20 Million From A Half Crowne Stake
To Sell Or Not To Sell: M&C's Asset Review May Answer The Question
One Hilton Hotel Performance You Won't Want To Tape
Marriott Launches Italian Renaissance
Jurys' Verdict On The Full Year Is One Of Satisfaction
Armani Tries Hotels For Size
Fadesa Boosts Barceló's Ambitions
Sol Meliá Accentuates The Positive
Denmark Can Sleep Well Knowing It Has A Second Park Inn
Dukes Put Up For Sale In London
Mehmet Hattat: Istanbul's Diamond Geezer
Orange Wings Has Austria's Town Halls In A Flap
Opus For Days Inn Chain
A Few Words From Whitbread Before Closing

IHG Reaps £20 Million From A Half Crowne Stake
InterContinental Hotels Group (IHG) has laid recent press speculation to rest by selling the Crowne Plaza Hotel Midland-Manchester. Leisure investment firm Quintessential Hotels (QH) paid £20 million in cash for IHG's 56% stake in Midland Hotel and Conference Centre, the holding company for the 303-room property. QH also found an additional £16 million to buy out the remaining shareholders: Modesole and Northern Assurance. With the deal done, the Paramount Group of Hotels, which shares a Managing Director, Michael Purtill, with QH, can move in as manager. The four-star hotel will revert to calling itself The Midland, and from this October it will enjoy a £12 million refurbishment, work which will include the addition of eight new bedrooms. The sale of this hotel has resulted from IHG's ongoing asset-by-asset review of its portfolio, a process that has reportedly cast the shadow of the estate agent across another two properties in the UK. The 129-room Holiday Inn Preston and the 136-room Holiday Inn Middlesbrough-Teesside have reported asking prices of £6.5 million and £2 million, respectively.

To Sell Or Not To Sell: M&C's Asset Review May Answer The Question Return to Headlines
Asset-by-asset reviews are not the sole preserve of InterContinental Hotels Group it would seem: Millennium & Copthorne (M&C) is to embark on one of its very own. M&C's Chairman Kwek Leng Beng has been quoted in a report by The Times' Dominic Walsh as saying that he would be looking at each property to see whether to sell or not. One candidate for an early departure could be the Copthorne Tara Hotel in west London; the 832-room property was singled out by the company in its full year results statement last week for having 'significantly affected' M&C's performance in London: fewer flights into and out of the UK lost the hotel 16,000 aircrew room nights in the first half of 2003. The dice, however, might not yet be loaded against the Copthorne Tara and its brethren in the capital. Mr Kwek added that such hotels could enhance their profitability by developing casinos.

One Hilton Hotel Performance You Won't Want To Tape Return to Headlines
A battle on three fronts – against the outbreak of Sars, the market conditions imposed by the war in Iraq, and general economic decline – is one that is seldom won, and though Hilton Group's hotel division fought resolutely it ultimately proved to be unequal to the struggle. Hotel operating profits for the year ending 31 December fell 30.9% to £146.5 million, as trading suffered in the European capitals in particular. RevPAR in London, for example, was down 5.4% on the previous year's comparable, at £65.90. The group as a whole, though, spurred on by the Ladbrokes betting and gaming arm, saw pre-tax profit before exceptionals rise 0.4% to £272.4 million and turnover soar 62.9% to £8.9 billion.

Marriott Launches Italian Renaissance Return to Headlines
Marriott International is indeed to bring the Renaissance brand to Italy for the first time later this year. The US chain issued a statement that confirmed reports abroad in the Italian press last November that Marriott had struck a franchise agreement with real estate operator Dr Salvatore Naldi on the Grande Albergo Mediterraneo. The 220-room property in the southwestern city of Naples will be refurbished and will then reopen as the Renaissance Naples Grande Albergo Mediterraneo. Marriott and Dr Naldi, who already operates the Rome Marriott Grand Hotel Flora, have also taken a trip across the Bay of Naples to the island of Capri where the two will renovate the 61-room Tiberio Palace and reopen it by the end of 2004 as the Capri Marriott Tiberio Palace Resort & Spa. As if all this were not enough then Marriott has another first up its sleeve: the establishment of the first JW Marriott hotel in continental Europe. The company will start work next month upgrading the 402-room Marriott Bucharest Grand Hotel in the Romanian capital and turning it into the JW Marriott Bucharest Grand Hotel.

Jurys' Verdict On The Full Year Is One Of Satisfaction Return to Headlines
The well-documented troubles of the world and the appreciation of the euro came to dog Jurys Doyle Hotel Group over the course of 2003. However, the company managed to bring these problems to heel and record what its Chief Executive Pat McCann termed a satisfactory performance. Pre-tax profit of €45.8 million for the 12 months to 31 December was down 13.4% on the previous year's comparable, with turnover down 5.4% at €253.8 million. Occupancy levels and RevPAR across the portfolio remained essentially flat, but despite this lack of movement the company was still able to outperform its competitors in Dublin, London and Washington DC in terms of occupancy. The company was particularly pleased with the returns from its 13 Jurys Inn properties in the UK and Ireland, a pleasure that will extend to Nottingham in late 2005. Property developer McAleer and Rushe will build the €28.5 million Jurys Inn Nottingham on a mixed-use development to the southeast of the city centre. Jurys Doyle will take a 35-year operating lease on the 250-room hotel from the developer.

Armani Tries Hotels For Size Return to Headlines
Italian fashion house Giorgio Armani and EMAAR Properties of Dubai plan to open ten luxury hotels and four luxury resorts in destinations worldwide over the next seven years. Cities such as London, Paris, Milan and New York will be modelling some of the US$1 billion collection, although it is reportedly the emirate of Dubai that will be first down the catwalk; EMAAR Properties' Burj Dubai development will be graced by a hotel of 250 suites. A company to manage the Armani Luxury Hotels and Resorts project will have its headquarters in Milan, and it will aim to have at least six of the hotels and two of the resorts open within five years.

Fadesa Boosts Barceló's Ambitions Return to Headlines
Spanish property firm Fadesa has joined forces with Barceló Hotels & Resorts with the aim of building four-star and five-star hotels totalling 5,000 rooms in Spain and other Mediterranean countries. The duo hope to realise their ambition within five to seven years; Fadesa will find 83.5% of the €700 million that will be required. The project will be a boost to Barceló's strategy, which calls for the company to have at least 200 hotels by 2005. Elsewhere in Spain, fashion entrepreneur Amancio Ortega, who counts a 10% stake in NH Hoteles among his investments, is reported to have paid an undisclosed sum through his Pontegadea investment firm for Occidental Hotels & Resorts' Coral Beach hotel. Occidental will continue to operate the 170-room, de luxe four-star property in the southern Spanish city of Marbella. And Spanish real estate company Metrovacesa is reportedly planning to spend €43 million on the refurbishment of the Mercator Hotel in Madrid with a view to reopening the four-star property in 2005.

Sol Meliá Accentuates The Positive Return to Headlines
2003 May have been the year of the war in Iraq, the outbreak of Sars and the appreciation of the euro but Sol Meliá has emerged from it in a positive frame of mind. The company said that it had outperformed most of its peers over the year thanks mainly to a strong summer season in Spain, and that it was already looking forward to 2004. As for the results over the 12 months of 2003: EBITDA fell 4.7% to €222.3 million and revenue declined 2.2% to €987.8 million. Marketwide RevPAR was 1.7% lower at €44.6.

Denmark Can Sleep Well Knowing It Has A Second Park Inn Return to Headlines
Rezidor SAS Hospitality has treated Denmark to a second taste of the Park Inn brand by opening the 110-room Park Inn Maribo Søpark in the town of Maribo. A Danish hotelier that has seen beyond its native shores is Helnan International Hotels, which recently opened the four-star Helnan Chellah hotel in the Moroccan capital Rabat. Over on Morocco's western seaboard, meanwhile, the Bakrim family will shortly be opening the US$6.8 million 155-room, four-star Atlantique Panorama in Safi. Also with an opening in Morocco to his name is Jonathan Wix, who recently unveiled the five-suite Riad Farnatchi in the city of Marrakech.

Dukes Put Up For Sale In London Return to Headlines
The Times reports that the five-star Dukes Hotel in St James's Place, central London is up for sale. The newspaper suggests that the privately owned 89-room property could attract offers of at least £45 million. A Londoner has headed out of town bound for Hythe on the south coast of Kent to buy the property that founded the Marston Hotels chain. The unnamed purchaser paid an undisclosed sum for the Stade Court Hotel; the 42-room property had an asking price of £1.35 million. Elsewhere in England, the city of Lincoln could get a new hotel if the council can find a developer willing to take a 99-year lease on West View, the city's former workhouse. And on the opposite side of the country the town of Birkenhead on the Wirral could receive a 100-room hotel and a casino in a multimillion pound scheme.

Mehmet Hattat: Istanbul's Diamond Geezer Return to Headlines
A report in the Turkish press suggests that businessman Mehmet Hattat is to spend US$150 million on raising what would be the tallest building in Istanbul. The so-called Diamond of Istanbul would stand 200 metres tall and would incorporate a 300-room hotel within its 50 storeys. Across in Greece, construction company Domotechniki is nearing the end of its €12 million conversion of a former tobacco warehouse in the northern town of Stavroúpoli into the 74-room Les Lazaristes hotel. The project occupying Slovenian investment firm Argolina is the construction of a tourist complex in Isola on the coast of Slovenia. Abanka Vipa is meeting the reported construction costs of US$64.3 million of a project that will include a 210-bed hotel.

Orange Wings Has Austria's Town Halls In A Flap Return to Headlines
Should you chance to find yourself outside an industrial park in Austria and happen to see a List General Contractors lorry go by pursued by persons wearing mayoral regalia, then do not be alarmed. For what you will have witnessed is the latest hotel craze that is said to be sweeping the country: the prefabricated property that takes but three months to erect and requires next to no staff to operate. The Orange Wings hotel in the eastern town of Krems started the mania, which, according to List's partner BTB Beteiligungs, has mayors from across Austria clamouring for their town to be next. A second hotel is nearing completion in Wiener Neustadt and another seven hotels are planned. With each hotel costing around €35,000 a room to build and with the room rate fixed at €42 per night throughout the year, the idea is said to be attracting interest from countries in eastern Europe too.

Opus For Days Inn Chain Return to Headlines
British property development and investment company Opus Land is to assist the Cendant Corporation in the ongoing expansion of the Days Inn brand in the UK. Opus will seek out suitable sites in appropriate locations (sites alongside motorways, in urban areas and on business parks) and will then get the cement-mixers turning in a rapid programme that could see as many as 120 Days-branded properties built by 2007 at a cost of a reported £400 million.

A Few Words From Whitbread Before Closing Return to Headlines
The high-flying Travel Inn hotel chain had to settle for third place in the like-for-like sales growth rankings covering the first 50 weeks of Whitbread's current financial year ending 4 March. The David Lloyd Leisure fitness chain set the pace, albeit that its 5.8% figure was for 48 weeks. The Beefeater chain perhaps more usually associated with the wooden spoon, showed its appreciation of the attention Whitbread has been giving it by posting growth of 4.0%. Travel Inn was 3.6% ahead on the previous year's comparable. The shine on total group sales growth of 2.4% was slightly tarnished by the Marriott-branded hotels, which were 0.2% down on the previous year. However, that figure was an improvement on the negative growth of 0.5% the portfolio returned after 33 weeks. Whitbread's Chief Executive David Thomas said he was comfortable with current market expectations ahead of the full-year results, which are due to be announced on 5 May.

Absolute Share Price Performance Over the Past Week 19/02/04-26/02/04

Sol Meliá - The full year results met the expectations of most analysts. Morgan Stanley retains its 'Underweight' rating and UBS its 'Neutral 2' rating.

Hilton Group - Group results that surpassed expectations were tempered by the hotel division's performance. Deutsche Bank keeps its 'Hold' rating.

Jurys Doyle Hotel Group - Full year results that came in below expectations and the company's cautious optimism for 2004 sent the share price falling.