Successes in Persian Gulf hotel markets such as Dubai, Abu Dhabi, Saudi Arabia and Qatar are spawning a wave of operators who now have enough experience to accelerate expansion beyond their comfort zones. One such company is Abu Dhabi-based Rotana, which has 50 hotels open and another 55 solid management deals with some 13,935 rooms in various stages of development in markets ranging from its backyard to Turkey, Iran and the Congo. Rotana President and CEO Omer Kaddouri says 14 of those 55 hotels will open before the end of next year.
The rate of Rotana’s growth has remained steady in 2014, with close to 15 deals signed for the year — similar to what it accomplished in 2013. “Now, we are looking at about 50% of those hotels being outside the Middle East,” Kaddouri said. “We are also looking at more iconic buildings with more than 300 keys and sometimes even 600 and 700.”
To jumpstart Rotana’s growth in other regions, its investors are starting to place more strategic equity into deals. Whereas today strict management accounts for 98% of Rotana’s portfolio, within about five years Kaddouri says 20% will include some sort of equity stake.
As Rotana grows, so grows its brand stable. While the core Rotana and mid-market lifestyle Centro brands make up a bulk of the portfolio, last year it launched Residency by Rotana — furnished and unfurnished branded residences. Today, three are in operation, and another five are under development. “We feel that’s going to be an important brand for us moving forward,” Kaddouri added.
The Centro brand was developed five years ago, and today five are open with another 15 under development — both inside and outside the Middle East. “We fall in line with Holiday Inn Express, Ibis and Premier Inns,” Kaddouri said, adding that the next Centro will open in Doha in the next few months.
Looking further afield, Kaddouri said he is scouting Asia and hopes to have a deal done in Australia before the end of this year.
At the same time, Kaddouri said Rotana will control growth internationally. “Hence, Africa, Turkey and Iran are just around the corner for us, but it’s just a matter of time,” he said. “We want to grow, but we want to grow in a sustainable way. We have time.”