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UK market remains key to Starwood's development plans

By Peter Ruddick , 23-Mar-2012

Related topics: Venues

Starwood Hotels & Resorts has announced it plans to open 25 hotels in Europe over the next four years and the group's senior vice president for the region has suggested 'one or two' of those might be in the UK market which remains important to the company.

Starwood Hotels & Resorts are to open 25 new hotels over four years in Europe with one or two of those potentially in the UK, following the opening of Aloft at London ExCel last year

Starwood Hotels & Resorts are to open 25 new hotels over four years in Europe with one or two of those potentially in the UK, following the opening of Aloft at London ExCel last year

Globally, the chain which also operates the Sheraton and W Hotel brands plans to open 80 new hotels in 2012. Last year was a record one for the company with 112 new hotel deals, the highest number since before the global economic crisis.

Speaking to BigHospitality, Michael Wale, senior vice president Northern Europe for the USA-based company, said the UK market remained crucial to the group's plans for the continent.

“In Europe there are the emerging markets certainly Eastern Europe and Turkey. Those are certainly growth markets for us without question, however the more matured developed markets are equally attractive to us. We think we can get to 25 new hotels and if you look at the pipeline across Europe, the UK has the largest pipeline of potential projects in Europe so that would suggest that maybe one or two of them might be in the UK,” he said. 

Aloft partners

At the end of 2011 Starwood opened Aloft at London's ExCel centre , a year after launching the W Hotel in London's Leicester Square. Although Wale admitted Starwood mainly operated high-end or luxury hotels, he said the Aloft brand was the one he thought would be the focus of further growth for the company in the UK.

"Aloft is our mid-market offering and that is why I happen to think it is the brand that probably has the best growth potential in the UK market and that is frankly driven by what are the rates that you can achieve in those market places,” he said. 

Wale revealed both the Brussels and London sites for the Aloft brand were opened as managed hotels so they could exist as examples to attract potential developers and franchisees. Wale told BigHospitality Starwood was in discussions with a number of partners about developing Aloft in the UK. The brand, Wale argued could work as a new-build or office conversions, primarily in locations outside the capital such as those near student campuses or transport hubs.

“I think our Aloft product would work extremely well in many cities in the UK and we certainly believe that has great growth opportunities. Aloft is the brand that certainly would resonate with developers in the UK for secondary and tertiary locations," he said.

W Hotels and Sheraton

Turning to Starwood's luxury brands, Wale said he thought London could potentially take more than one W hotel following the Leicester Square opening but he said the brand would have limited potential in the regions. Manchester and Glasgow or Edinburgh could suit a W hotel, Wale said, but not many cities beyond that.

In four years Starwood has grown its luxury room count by 75 per cent globally and is also making investments in the existing luxury portfolio. A major refurbishment of the Edinburgh Sheraton Grand Hotel & Spa this year will see the hotel re-open in Aprilas the flagship Sheraton for the company in Europe.

"The Sheraton brand is the engine that drives Starwood. It is probably our most recognised brand globally. 93 per cent of all travellers recognise the Sheraton crest. Why this is a flagship Sheraton for us in the UK and in Europe is because it brings the new visual identity of the brand to life," Wale said.

The renovated venue will be important to Starwood to attract investment to the iconic brand, however Wale concluded that Aloft remained the main growth focus in the UK market.

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