THE PIPELINE : ROTANA
A lobby at the lifestyle Centro brand
is well organized and comparable with that of the large international chains ,” he says .
Rotana ’ s executives get high marks for securing the fences in their own backyard before focusing on expansion beyond core markets . “ They know that their strength lies in the UAE and GCC ( Gulf Cooperation Council ) and have wisely consolidated their position in this region ,” Wilkinson says .
Now comes the challenge . The view from Rotana ’ s corner office is that its 2010-2011 growth sprint was barely a warm-up given the mid-term goals . “ Rotana is managing an ambitious expansion that will see our portfolio of managed properties increase to more than 70 opened or under development by the end of 2012 . The goal is to have a hotel in every country in the MENA ( Middle East and North Africa ) region ,” says Selim El Zyr , Rotana ’ s president and CEO . Given some fencesitting by international chains about development beyond a few key markets , that should mean open ground for a company that can see opportunities through the filter of local expertise .
However , MENA is still a tough place to play for hotel companies . Markets like Dubai and Doha are constantly in danger of becoming oversupplied . And , even with international chains looking for ways to tap expanding mid-spend family and senior travel markets , it is still the luxury sector that is attracting much of the internationally branded action . So , in every city , there is the threat of losing customers to brands with bigger names , better loyalty programs and the newest hotel .
Boutique play In 2005 , as the company neared critical mass , El Zyr and his team realized that to compete with the multi-segment appeal of global flags the company would have to be more than just another luxury hotel operator . Though the core Rotana brand was and will continue to be the heart of the pipeline , management didn ’ t want to lose access to the increasing pool of Arab travelers who want design-led , lifestyle hotels . Their answer was the rollout of Centro
Hotels by Rotana , a hip , boutique concept that retained its older sister ’ s signature Arab feel .
Finding a highly focused niche to occupy also allowed Rotana to construct a more attractive package for investors . “ It ’ s a lower build cost , superior returns on investment and lower levels of staffing ,” El Zyr says .
It is also well enough defined to get some notice in the crowded lifestyle sector . “ Centro is a very nice concept , with high design values at an affordable price point . In a way , I would compare them to Aloft by Starwood ,” Wilkinson says . “ I would hope that Rotana can get the ‘ packaging ’ and advertising of the Centro brand right , to achieve the same kind of success and following as Aloft .”
Rotana ’ s leadership has taken some heat for its decision to focus its mid-tier offer in the lifestyle niche . Industry watchers such as Jalil Mekouar , managing director , Jones Lang LaSalle Hotels , Middle-East & Africa , suggest the company might have gained better long-term positioning by leaving W ,
36 HOTELS January / February 2012 www . hotelsmag . com