Strategic approach needed towards investments, says HMH CEO

Visitors and exhibitors at the Hotel Show at Dubai World Trade Centre. There are 183 hotel projects and 54,000 hotel rooms in the UAE pipeline currently.

In an era of tight capex budgets, a strategic approach is needed to ensure that investments in the hospitality sphere are maximised to positively impact both operational performance and capital value, said Laurent A. Voivenel, CEO of Hospitality Management Holdings (HMH).
Speaking at the Vision Conference at The Hotel Show in Dubai, Voivenel shared strategic insights and trends in hospitality investment regarding new projects as well as refurbishments.
"A well thought out and executed capital expenditure strategy in the form of a hotel improvement plan can propel a hotel ahead of its competitive set. There are a number of considerations including age of asset, legislative regulations/changes, emerging consumer preferences and competitive positioning in the market that influence the way in which capital expenditure budgets are directed. Extended period of trading at high occupancy levels heightens the need for refurbishment," he said.
More lodging projects broke ground in certain markets in the Middle East as traditional lenders eased restrictions on construction loan originations. There are 183 hotel projects and 54,000 hotel rooms in the UAE pipeline currently. Around 10,000 new hotel rooms will open in Dubai throughout 2016.
"Often hotel owner and operator capex priorities have not always been in alignment and in many cases at odds. A collaborative approach, whether for soft refurbishment or extensive upgrade programs, is required to plan for improved trading performance, adaptation to technology advances, changes in consumer trends and compliance with legislation. Typically operators and investors work on seven year cycles for room refurbishments and five-year cycles for food, beverage and public areas but this can be extended with well-designed, high-quality fit-out and rolling maintenance programmes," Voivenel added.
Exhibitors and visitors alike spoke of excitement heading into day two of the 2016 Hotel and Leisure Shows, after a busy opening day flush with international dignitaries and leading hospitality industry experts and professionals. The shows also welcomed Patrick Hennessy, ambassador of Ireland, and Christian Watts, consul general of Switzerland. Hennessy visited to celebrate the global launch of two new products by Irish firm Capital ISS Group including SafeBox Auto, the first fully automated safety deposit box system, and Safe Place Live, a ground-breaking safety and security management system that can account for thousands of people in the event of an evacuation within minutes. "Dubai is an important shop window not just for the UAE but for the rest of the world, and it makes me hugely proud to see an Irish firm showcasing on such a global scale at an event like this," he said.
For the first time this year, The Hotel Show also plays host to a number of fascinating interactive features, including the live painting of two art installations - a collaboration between 17A Art Consultants and BagnoDesign, focused on the future of hospitality and bathroom design - and the on-site manufacturing of hospitality uniforms by industry-leading A. Ronai.
- rohma@khaleejtimes.com