NH Hoteles at a glance
in 26 countries approximately 50 % of repositioning capex is targeted to Spain and BEnElux
€ 234 million
The InTervIew : Federico González Tejera
NH Hoteles at a glance
5th
largest hotel brand in europe
383 hotels
( owned , leased and managed )
57,846 rooms
in 26 countries approximately 50 % of repositioning capex is targeted to Spain and BEnElux
rEcEnt valuE of ownEd aSSEtS Stood at
€ 1.4 billion to € 1.6 billion
( us $ 1.9 billion to us $ 2.2 billion ),
not including thE additional valuE of lEaSEd and ManagEd hotElS or SotograndE rEal EStatE
a majority of the refurbishment plan will be spent on upgrading hotels to the uppEr-upScalE SEgMEnt
Madrid Stock E x c h a n g E MarkEt cap
€ 1.3 billion
( us $ 1 . 8 billion )
2013 capital i n c r E a S E
€ 234 million
( us $ 315 million )
via share acquisition by hna group , china
H : What is the timing for the disposition ? FGT : We will do it in the next year . H : How are you going to overcome the weight of your excessive lease contracts ?
FGT : The focus is to try to get more of those leases variable . H : Would you add leases to the portfolio ? FGT : It depends on the opportunity , but I would have no issues signing a lease .
H : How are you addressing over-exposure in Spain ?
FGT : Spain accounts for as much as 25 % of our revenue . We have reduced costs and actually optimized the cost with a strong focus on variablizing the cost base . For example , we have outsourced some of the cleaning of the hotels , so if you don ’ t get to the occupancy levels with the variablization of costs you are much better protected .
From a revenue point of view Spain today is 25 % below the level of prices in 2007 , 2008 . If we recover part of that the company upside is significant .
We need to communicate more to consumers so we are top of mind in Spain . Plus , the capex plan for the next two years places a significant amount in Spain to renovate many of those hotels .
H : Can you elaborate on your plans to expand management capabilities ?
FGT : We are working on a class about the role of the hotel director . There are hotels where you need a more traditional director that takes extreme control of all the costs and focuses on the consumer experience . There are other hotels where you may need a director with more of an outside focus . We are looking to all of our people to see who is better prepared to serve which roles .
H : How can you overcome the perception that NH manages commodity brands ?
FGT : We will make sure consumers have one or two signature experiences they would not have anywhere else , and we will have those as of April .
Second , we are putting in place a new bed in all the Collection hotels and NH 4-stars . Also , plasma-screen TVs and a new shower experience are being installed at NH Collection and NH 4-stars . Next , we will start to look at the vacation brand , Hesperia .
H : What brought back HNA after retreating from its original investment plan , and what does its increasing stake mean ?
FGT : The fact that they are getting higher and higher shares must mean they see an even greater upside than they thought the company had . They now have 24.6 %, and I think they will continue growing up to 29.9 %. We are working with them to identify how we would manage hotels in China , but that has not been the priority . Priority one has been to put order into the 400 hotels we have .
NH could eventually be a great brand for China . HNA has around 60 hotels , and some are HNA and some are Tangla , which I think has the potential to grow outside China .
H : What is the biggest challenge in executing this plan ?
FGT : The return to growth of the company doesn ’ t depend on one big item ; it depends on 200 small items . It is all about executional discipline , making all the reforms in a timely manner and securing the return on those reforms in a timely manner . This is where the company has usually been very strong — the operational and the disciplines from operations . That is why I feel very confident .
H : You have the Madison Jolly in New York City . What are your plans for that property ?
FGT : It needs to become a flagship of
44 HOTELS March 2014 www . hotelsmag . com