Business | Tourism

Chedi Muscat rises to unusual challenge

In late 2003, York Brandes was interviewed for the job of general manager for the five-star beach resort Chedi Muscat, and was given an unusual request: make sure the hotel gets fewer guests.

  • By Ivan Gale, Staff Reporter
  • Published: 00:00 February 14, 2007
  • Gulf News

  • Image Credit:
  • The Chedi Muscat recently transformed its business model and now boasts nearly three employees for each room.
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Dubai: In late 2003, York Brandes was interviewed for the job of general manager for the five-star beach resort Chedi Muscat, and was given an unusual request: make sure the hotel gets fewer guests.

Singapore-based GHM Group, managers of the Chedi and other hotels in Malaysia, Indonesia, Thailand, Vietnam, Myanmar and Florida, wanted to transform the hotel into something truly decadent.

The aim was to raise room rates to effectively earn more revenue from fewer bookings. "They were willing to lose 10 to 15 per cent occupancy and make more overall," Brandes recalled.

Brandes was hired, and now presides over one of Oman's most favoured destinations, a small design hotel with Arabic and Asian touches which sits on a sandy stretch of a private beach in Muscat.

Despite a near tripling in average room rates, the Chedi's performance has risen each year. It earned its owners, a group of Omani investors, 7.7 million Omani riyals ($19.8 million) in revenue last year, with a 72 per cent occupancy rate. That compares with just 4.9 million riyals ($12.5 million) in the first two years of operation combined.

Brandes recalled that in the beginning, the other general managers of Muscat's five-star hotels thought he was foolish. "They said, 'you're crazy - It's too expensive,'" he said.

Heavily dependent

The Chedi had opened just before the Iraq war started in early 2003, and its bookings, heavily dependent on European vacationers, along with weekenders from the UAE, were way off the mark. In the first year, only 19 per cent of the 151 rooms were full.

But gradually, over a period of many months, the Chedi became more popular even as it became more expensive. While it began with average room rates of 46 riyals ($120), the Chedi now charges an average of 128 riyals ($333), with current high-season rates now at an average of 145 riyals ($371) per room.

Brandes went on a sustained hiring spree that saw staff levels rise from 260 in the beginning to some 410 now, or nearly three employees for each hotel room.

He also began working on adding personal touches to the service. "We didn't reinvent the wheel," Brandes insists. He added upon the existing design elements such as resort grounds arranged with manicured date palms, four open-display kitchens in its restaurants, tennis courts, gym and infinity pools, and the spacious standard and deluxe rooms and private suites arranged with dark wood and marble.

The result, says Brandes, is that when his Omani owners travel abroad and say they are from Oman, they are asked, "Oh, have you heard of the Chedi?"

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