Premier Inn Dubai Investment Park, the brand’s first property outside the UK, opened in April.

Premier Inn’s tie-up with Emirates Group will open 5,000 guestrooms in the Mideast by 2012, starting with the first property, the 308-key Premier Inn Dubai Investment Park, which opened in April. Three other sites in the UAE are also under development, at Abu Dhabi National Exposition Center and at Silicon Oasis and Al Garhoud in Dubai. At least two other UAE projects are yet to be announced, with targeted locations including Oman, Saudi Arabia, Kuwait and Bahrain, says Premier Inn Managing Director Patrick Dempsey.

The expansion into India comes as part of a joint venture with Emaar MGF. A total of £300 million is to be invested over the next 10 years, with Whitbread and Emaar splitting the cost. The venture would create about 80 hotels and more than 12,000 guestrooms, targeting both business and leisure travelers. Initial sites include Delhi, Chennai, Goa, Hyderabad and Chandigarh.

The Mideast and India markets are rife for branded hotels in general and quality budget lodging in particular, Dempsey says. “These markets have the right economics for us—high GDP growth, a growing middle class, more people traveling,” he says. “There is little to no branded accommodation there in the budget hotel sector. If you go to Dubai, you have to pay £500 a night to stay at a Jumeirah hotel, and not everyone can afford that. We see a huge market for that.”

Although both the Middle East and India are frequent destinations for UK business travelers, Premier Inn is counting on most of its business coming from the domestic middle classes. Thus, with the expansion into new markets and different cultures, Premier Inn—which is known for its properties being remarkably consistent—has been forced to reevaluate its prototype, particularly in the UAE. The result of focus group feedback was to design the Dubai property with a swimming pool on the roof and to build guestroom bathrooms slightly larger, both to accommodate a greater ratio of leisure guests. Any changes to the India prototype have not yet been finalized.

Premier Inn is growing in the UK through a mix of new-builds and acquisitions, especially in the greater London market. The brand picked up 400 guestrooms earlier this year from Real Hotel Co. for £18.5 million, and a £44 million February transaction with Golden Tulip Worldwide brought another six hotels and 770 rooms into the portfolio. The Golden Tulip purchase also included 1,300 pipeline rooms set to open by 2010. Three properties with 800 rooms are under construction in the capital, at a cost of £70 million. All told, Premier Inn has a London pipeline of 6,500 rooms, with another 2,000 expected to be added within the next year. Premier Inn is already London’s largest hotel brand, with an existing |inventory of 44 hotels and 5,300 rooms.

In the UK as a whole, the expectation is to reach 55,000 guestrooms by 2012, Dempsey says. “We still see the UK as a huge market for us,” Dempsey says. “We’re going to put another 20,000 rooms in the UK in the next four to five years.” The brand sees plenty of room to grow—while the U.S. budget sector comprises about 25% of the national inventory, it makes up only 13% of the UK inventory, Dempsey says.

The Premier Inn portfolio is largely owned by the company—88% is freehold, and Dempsey says there is no impetus to reduce that ratio.

In its 20th year, the Premier Inn brand has recently undergone a major identity change. Formerly known as Premier Travel Inn (the result of a prior merger betweenPremier Lodge and Travel Inn), it dropped the Travel portion of the name to clear up market confusion with Travelodge. Popular British comic actor Lenny Henry was enlisted to be the face of the renamed brand as part of a £13 million television campaign—the largest such campaign in the history of UK hospitality.

Premier Inn made news recently with a less conventional expansion announcement: The brand has purchased some 40,000 sq. ft. (3,716 sq. m) of land on the moon for £1 million and is designing a lunar motel. The moon property is scheduled for a 2033 opening.

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