hotel companies talk about growth, the talk often turns to
international investment and emerging markets. For Gerald Lawless, such
talk has been prominent throughout his career as a hotel executive. For
23 years, he helped grow Forte Hotels, working in places such as the
United Kingdom, South Africa, his native Ireland, and his current home
In 1997, he became managing director of a then fledgling luxury hotel group, Jumeirah
Hotels & Resorts. Since then, he has overseen an aggressive growth
plan, which has taken the company across several borders and into many
different cultures. Today, Jumeirah is known for building and managing
iconic properties in the Middle East, Africa, Asia Pacific, the United
Kingdom, and the United States. Recently, the company signed an
agreement to manage properties in Panama.
For Jumeirah, growth has always meant seeking emerging markets in
faraway lands. And with a goal of having a pipeline of at least 60
hotels by 2012, Lawless is in the business of seeking new markets and
growing the Jumeirah brand across many borders. Lawless discussed the
state of international investment opportunities and what they mean to
the hotel industry. He also discussed how his company identifies new
markets and its plans for ambitious growth in the coming years.
Lodging Magazine: These
days, a lot of hotel companies are looking at international markets for
their growth opportunities. Jumeirah is a company that crosses a number
of borders. Why is it important to look at emerging countries for
growth and how do you identify those markets?
Gerald Lawless: We go
where the greatest opportunities are. Having established a very strong
foundation for Jumeirah as a global luxury hotel brand, with our
portfolio of properties in Dubai, Jumeirah Essex House in New York, and
Jumeirah Carlton Tower and Jumeirah Lowndes Hotel in London, we are
naturally looking for opportunities to grow and we have a robust
pipeline of potential openings. For example, in the Americas we have
already announced management agreements in Panama, Argentina, and the
British Virgin Islands. Also, recognizing the strategic position of
Dubai as an international hub and a gateway to the East, we are
actively pursuing growth opportunities in China, Southeast Asia, and
the Middle East.
LM: Where are the emerging markets at this time?
GL: China is hot—and this
is why we have already committed ourselves to five management
agreements there. India is also hot and we hope to be better
represented there in the future.
LM: Why you think these markets look so strong?
GL: The strength of these
markets lies in the emerging middle class and the significant wealth
they have been amassing over the past 10 years. I believe this trend
will continue and they’ll become entrenched as permanent and profitable
LM: What are the benefits of
operating across various countries as opposed to limiting a hotel
company to a certain country or region?
GL: The principal benefit
lies in the diversification of risk. There are certain markets that
always fare better in the event of a downturn and they can often
counteract the effects of other markets falling into recession. Having
said that, this most recent downturn has been a global phenomenon. Our
feeling is that a luxury brand needs to be represented globally,
particularly in key letterhead cities and resort areas. That’s why I’m
particularly pleased that in addition to London, New York, and Dubai,
we will be adding Shanghai and Frankfurt to our
roster of hotel locations this year.
LM: What are the challenges of operating a brand across borders?
GL: There are two key
advantages that Jumeirah has in operating a brand across borders:
location and people. Dubai is very conveniently located at one of the
best-connected global air hubs and is served by one of the most
far-reaching airlines, Emirates. On the people side, it is essential to
have a management team that is experienced in rolling out an
international expansion and the right organizational structure to
support it. I believe that Jumeirah has both.
LM: You operate in several
different cultures. How do you build and operate your properties
differently to suit different cultures, laws, etc.? More specific,
what would be a good piece of advice for starting up a property in a
place you haven’t been before? What would be the first things to look
GL: By its very culture
and its commit-ment to ‘Stay Different’, Jumeirah recognizes that
luxury brands must display a sense of place and be representative of
and sensitive to local culture. We embrace the fact that each hotel has
its own distinct identity and is very much part of its local community
whilst ensuring that its standard of service is endorsed and supported
by the Jumeirah brand.
LM: Do you run into challenges
when creating marketing and operational plans for different regions?
For example, you’ve just signed to manage hotels in Panama. Can you
transfer plans and techniques from, say, the Middle East to Latin
America, or do you have to create a different way of thinking?
GL: The specifications of
the Jumeirah brand are structured in a way that recognizes national and
regional differences, but the fundamentals of our hallmarks and our
guiding principles apply in every hotel. Our teams are truly
international. In Dubai alone we have 110 nationalities working for
Jumeirah and we are in the fortunate position of having access to that
expertise to ensure that we recognize the diversity of our guests’
LM: Luxury has certainly taken a
beating here in the United States recently. How has the luxury market
held up in other regions? What about other scales, such as mid-tier and
economy hotel brands, how are they holding up overseas?
GL: The luxury segment is
particularly resilient to changes in the market. This is particularly
so in the Middle East and Asia, as well as in key city locations, such
as London and New York. In fact our pipeline of new developments
actually increased during 2009 and we now have over 35 signed
management agreements throughout the world. This certainly indicates to
us that demand for luxury is still very healthy in our segment.
LM: Jumeirah is known for creating iconic properties, particular from a design
standpoint. With development lagging right now, has design suffered or
can we still expect to see dazzling architectural marvels spring up?
GL: Our pipeline of new
developments is very healthy and we continue to see a strong drive to
bring new, imaginative designs to the market. For example, Etihad
Tower, our project in Abu Dhabi, demonstrates cutting-edge
architectural design, and we continue to press for hotels and resorts
that exhilarate and inspire the imagination while being clearly
connected to their local culture and environment.
LM: If you could gaze into the
near future a year or two from now, how do you think the hotel business
will fare, particularly when it comes to hotels and resorts located
outside of the United States?
GL: It will be
interesting to see how new brands such as Jumeirah have taken their
place alongside more traditional luxury brands. In terms of specific
demographics, I think we will see a marked shift in country of
residence statistics from traditional European sources to markets such
as India, China, and Asia, in general. I also believe that Central
America and South America will continue their development of luxury
resorts, and of course, I look forward to seeing our own planned
operations in that region—in Panama, Argentina, Costa Rica, and the
British Virgin Islands—performing well.
LM: What does the future look like for Jumeirah Hotels & Resorts? Are there plans for expanding anywhere else in the world?
GL: Jumeirah will
continue on its fast-track expansion plan. I am delighted with the
continuing demand for our luxury brand and remain very confident that
we will achieve our long-stated objectives of having 60 hotels signed
up in 2012 and at least 30 of them in operation by 2013.
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