Dubai: Even as the hotels market in the Middle East — and globally — is seeing a strong shift from luxury to mid-range, the InterContinental Hotels Group (IHG) has not stopped expanding in the luxury segment of the market, although it is still strongly focused on the midscale side of the business.
The hotels group, largely known by its Holiday Inn, InterContinental and Crowne Plaza brands, is looking to bring its boutique lifestyle luxury brand, Kimpton Hotels & Restaurants, to the region.
This time it would be a unique offering in the luxury end of the market, says Pascal Gauvin, IHG’s Chief Operating Officer for India, Middle East and Africa.
“It’s an American brand. We are now starting to export it outside of America. We would love to start with Dubai in this region,” he told Gulf News in an interview.
IHG bought the brand in 2014, and started to take the Kimpton brand outside of the US only in January this year.
It has signed for a property each in Amsterdam, which is about to open sometime this year, and Paris, Gauvin said.
“We only want to do the big capitals [for this band]. And of course, for this region, we want to start with most probably Dubai and then [take it to] all the other big cities in the region.”
Investor appetite
Asked if Dubai would see a signing for Kimpton sometime this year, Gauvin said: “I can’t tell you when we are going to sign one in Dubai. It depends on the investors’ appetite.”
He was quick to add that IHG has already in discussions with investors to bring the brand to this market.
“We are talking to some investors already. The ones that we have started seeing are really keen on exploring possibility with the brand. People who are interested are the ones who already know the brand from the US, and they are very glad that we have started exporting the brand,” Gauvin said.
Luxury segment growth
Contrary to belief by some that the luxury end of the segment might be reaching a saturation point in a market such as Dubai and the overall region, Gauvin said he was optimistic about the growth in this segment.
“Luxury will always be luxury, because by DNA, this is where this region started and so we will remain quite strong in the luxury [segment] … but maybe a different luxury than what we see today. It’s more boutique lifestyle luxury more than the large brand luxury,” he said.
IHG has another lifestyle brand, Hotel Indigo, which caters to the upper scale of the market, and reflects the neighbourhood around, as Gauvin puts it.
“But Kimpton is the other way — it’s more inward thinking. So we want to cocoon them [the guests] inside the hotel. Restaurants here will play a very important part,” he said.
Hotel Indigo, meanwhile, is under construction in two markets in the region — in Dubai and Riyadh. “IHG is planning to bring new brands to this region,” Gauvin said.
IHG has 79 existing hotels in the Middle East with 26 in the pipeline. “In three to five years, they will all be open. And that’s 47 per cent growth,” Gauvin said.
Factbox: Midscale focus
The aggressive growth in the midscale segment, meanwhile, continues.
“There is a diversification taking place in the market. And that’s why we are bringing in a lot of midscale brands such as the Holiday Inn, to Dubai in particular, but in the region in general,” Gauvin said. “We were an emerging market for many years, and it’s maturing [now], especially the UAE, specifically Dubai. So it’s really time to focus on our midscale brands.”
He added that IHG would continue to expand its InterContinental and Crowne Plaza brands.
