Wyndham Hotel Group recently announced plans to enter the United Arab Emirates with its first property in Dubai, the latest step in the chain's expansion in the Middle East. Wyndham currently operates 35 hotels in the Middle East, with 27 of them under the Ramada brand.
Wyndham Hotel Group executive vice president and chief operating officer Bob Loewen oversees the group's international operations. In an interview with the World Property Channel he discussed the group's growth in the Middle East and other global expansion plans.
With many Wyndham hotels already in the Middle East, what makes Dubai different?
The increase in inbound travel into Dubai has been substantial. There is a strong desire to make Dubai the most visited city in the world - as a result of Dubai's Vision for Tourism signed early this year, the government and the Dubai Department of Tourism and Commerce aims to double the number of visitors by 2020, from 10 million visitors in 2012 to 20 million per year, and triple tourism's contribution to the city's economy. The great investment in infrastructure there is supporting this effort and, as a result, the city will absolutely be able to support that kind of rapid growth, which will greatly benefit hotel companies and owners looking to operate there.
What are the challenges of competing in Dubai?
As a result of its great growth potential, every brand wants to be in Dubai, which makes for very healthy competition. It's also a very expensive market in which to do business; as such, at Wyndham Hotel Group, we're currently focused on introducing and growing our higher-end offerings there, like Wyndham Hotels and Resorts and Ramada, and looking for the right opportunities in the future to introduce our economy and/or midscale brands in the city as well.
Where are the customers coming from?
We see visitors from all over, but especially from Russia and Eastern Europe, Saudi Arabia and Egypt. There is also significant opportunity to increase inbound travel from the U.S.; while visas are not currently required for Americans to enter the country, there has been discussion of permitting Americans to clear customs in the Emirates before arriving in the U.S. - if this were to take place, the amount of travel into Dubai from the U.S. could greatly increase and would make traveling to the Emirates much easier for U.S. citizens.
What are the chain's future expansion plans for the Middle East?
We see a great future in the Middle East - there are great opportunities for us to grow the Wyndham Hotels and Resorts brand throughout the region and introduce it to new markets...We added our first Wyndham in Turkey, Wyndham Istanbul Kalamis Marina, at the end of last year and have plans to open another in Istanbul this year. We're excited about the brand's growth potential and hope to have a Wyndham Hotels and Resorts property in every major city in the Middle East. We're also looking at opportunities [to] introduce the brand in major markets in Africa, where hotel development is significantly increasing.
Is Wyndham performing as expected in the Middle East?
Our owners and franchisees in the region operating hotels under our brands are very pleased with the performance they're seeing at their properties.
Overall, how is the region performing compared to this time last year?
Performance in the region is certainly up - industry experts like STR have reported an increase in RevPAR of more than 11 percent in Dubai alone in the first quarter of 2013 versus the first quarter of last year. The results from 2013 so far are promising and we expect to see continued positive performance from the region.
How has the Doha hotel been performing?
The owners of the Wyndham Grand Regency Doha are very pleased with the hotel's performance. This particular ownership group operates two hotels under our Wyndham Hotel Group brands and we're hopeful we will have the chance to continue working with them on other opportunities in the region.
What have you learned about the Middle East customer base?
There are specific cultural differences and traditions among travelers in the Middle East; for example, food and beverage requirements are very specific to the region and may vary across different countries. As a result, hotels must address these specific and differing needs and, furthermore, hotel companies and brands must understand and accept such requirements if they're going to succeed in the region.
Are there other global locations with similar expansion plans for the brand?
Absolutely - we see great potential for the Wyndham Hotels and Resorts brand to grow in the Middle East, as mentioned, but also in Europe and Latin America. Just this February, Wyndham Hotel Group signed an agreement with Grand City Hotels to introduce the Wyndham brand in Germany with the addition of 18 hotels to the brand family - this was part of a larger deal to affiliate 43 hotels under Wyndham Hotel Group brand.
We're looking to expand the brand throughout major markets in Latin America, specifically Brazil, where hotel development is growing rapidly. Finally, China continues to be a market for growth. We're always looking for the right opportunities to introduce or expand the brand in the right markets with the right partners.