Big brands enter, but is that enough?
New upmarket hotels that will rise over Manila’s skyline over the next five years will drive the demand for the Philippine luxury travel sector.
A total of 5,797 hotel rooms will enter the upper-end market by 2017, or a growth of 37 per cent. Luxury supply grew only 3.2 per cent between 2004 and 2011, said Bill Barnett, managing director of Thailand-based asset management and hospitality consulting C9 Hotelworks.
Clustered mainly in Newport City near the international airport, Entertainment City along Manila Bay and Bonifacio Global City across from the Makati CBD, these hotels include a Grand Hyatt, Shangri-La, Hilton, Westin and Sheraton, apart from Fairmont and Raffles Makati, which opened last December.
Barnett said last year was “great” for the destination, with investors and chains having caught up with the bullish mood in the Philippines. Manila’s upmarket hotels enjoyed high occupancy and rates in general, as was the trend over the past years.
But the question was whether the country could sustain the sentiment, maintain economic and political stability, and address the need for an “extreme makeover”. Barnett said the Philippines should develop other attractions as the four multi-billion dollar integrated resorts being constructed in the Entertainment City would not be enough to lure luxury tourists.
Investments are focused on gaming and luxury hotels there and at Resorts World Manila in Newport City. But other demand generators like amusement and theme parks, cruise, MICE facilities, wellness and medical tourism are needed if the destination aimed to rival Macau and Singapore, he said.
The Philippines also has to develop Intramuros – Manila’s historic Walled City – and other existing attractions to keep pace with the changing pattern of Asia’s tourism caused in part by a rising middle class.
Being the maritime of the Pacific, the Philippines already has the port facilities to develop cruising, which is a big come-on for many destinations. It should also be able to go into medical tourism, as Thailand has been able to attract people from the Middle East and Indochina with its quality medical facilities.
One of the opportunities that has not been tapped in the Manila Bay area is the MICE business, which Barnett pointed out already accounted for 14 per cent of the total market in Manila despite security problems.
Ferragamo’s idea of luxury
The grandson of the famous Italian shoemaker is a hotelier and Relais & Châteaux ambassador 2013. Raini Hamdi talks to him about luxury
What’s it like to be named Salvatore Ferragamo?
It’s an honour to bear the name of my grandfather. From a work standpoint, sometimes it helps, other times not. The funniest thing is people mistake me for my grandfather and are surprised by my young age (41 years old).
What can luxury travel and fashion learn from each other?
Both represent elegance, style and creativity. In the case of Italy, both the fashion industry and luxury resorts are able to represent to the world the elegant, historical but always innovative style of the Italian culture.
Growing up in the Ferragamo family, what to you is true luxury?
For me, and for busy people, it is the normality of things and moments.
What has changed about luxury products?
Now the value of luxury is not determined by the raw material of the product, but the creativity, originality and uniqueness. Obviously, then, the name of the creator helps a lot.
Will the European luxury travel market be healthier this year?
It is difficult to predict. Of course we hope for the best.
How has the market changed?
The market has also targeted the less wealthy. People are always busy and so they desire a great vacation, a unique experience.
Biggest challenge facing luxury travel?
Maintain quality, renew constantly.
What is your duty as Relais & Châteaux (R&C) ambassador?
Represent this great family, its values and its message. I also hope to raise awareness of my estate, Il Borro (a medieval hamlet in Tuscany which he restored as a hotel, with the site producing quality wines once more).
Does Il Borro attract Asian luxe travellers?
Yes, we’ve been working hard for a few years with Asia, with R&C and wine partners/enthusiasts.
A new chapter opens for Dusit
DUSIT International, which now has veteran hoteliers Giovanni Angelini, David Shackleton and Jeffrey Flowers on board the ship, is sailing into golden seas, with at least five hotels confirmed to open this year in diverse locations and each showcasing new brand standards.
The five hotels, all new-builds and management contracts, include a Dusit Thani in Guam, Hainan and Abu Dhabi; a Dusit Devarana in New Delhi; and a Dusit D2 in Pasadena (US).
In the pipeline are a Dusit Thani in Jeddah, a Dusit Devarana in Hainan and a Dusit D2 in New Delhi.
This month, CEO Chanin Donavanik (left) expects to sign a Dusit D2 in Nairobi and, in February, seal a JV in China with a local partner to manage and develop Dusit hotels in the country, as the group has done in India. Last year, a Dusit Thani Maldives was opened.
“Now we can expect to open seven to 10 hotels every year,” said Chanin. “All our new hotels will be really good. Some are going to be the best in their market.
The hotel in New Delhi, for example, is going to be the most talked about hotel when it opens, because of its unique design and feel – an intimate luxury home with only 50 rooms in the first phase and 70 rooms afterwards. The Dusit Thani in Abu Dhabi will be grand, possibly with the best conference facility there. The hotel in Guam is by far the best hotel in Guam.”
Asked why the places were far and wide and the challenge this would pose to operation, Chanin said: “That’s why I have good people. David (formerly with InterContinental Hotels Group and Starwood Hotels & Resorts) is running the day-to-day operation (as COO) and Giovanni (former CEO of Shangri-La Hotels & Resorts) is setting up the standards/systems and also oversees development.
These are people who know what to do, and you will see the way we grow will be more structured and the quality of our hotels will be much more consistent.”
He said the locations were strategic. “Maldives is considered the number one beach resort destination in Asia. Guam will help raise our brand awareness in North Asia – now, aside from the traditional Japanese guests, Guam is attracting more (South) Koreans and Taiwanese. Russians do not need a visa to Guam and there’s also a push for visa-free for Chinese. Guam’s hotel occupancy is 80-90 per cent.
“And if we want to move westward from Thailand, naturally we have to be in India.”
The group now has development offices for China (in Hong Kong), India, Middle East and Europe (in Dubai) and North America (which is covered by Flowers, formerly with Marco Polo Hotels).
“We have people and offices in place, that’s why we are growing. As well, as a Thai brand, we are seen as neutral – not American, not European – and other Asian luxury brands have gone out of Asia and created successful stories, which is good for Asia and for us,” said Chanin.
He stressed that Dusit International remained committed to grow in Thailand, its base for 63 years. It has a US$150-US$160 million property fund listed on the stock exchange, which may soon be converted into a REIT, and is actively seeking hotels to acquire and put into the fund. – Raini Hamdi