Wyndham Hotels & Resorts continues to expand across the Middle East with a pipeline of 23 additional properties and over 4,600 planned between now and 2023. Panos Loupasis, Vice President Development – Middle East, Eurasia & Africa for Wyndham Hotels & Resorts, discusses the company’s ambitious growth strategy and execution.
You recently announced your expansion in Oman with two new brand entries. Can you tell us a little bit about your strategy for this market and its importance for Wyndham?
Over the past year, Oman has become an increasingly popular destination for travelers, witnessing an increase of more than 25% in inbound visitors in the first six months of 2019 alone. This surge in visitor numbers follows the Ministry of Tourism’s sustained efforts to promote Oman as a key travel destination and attract investment to the sector.
The openings of our two new hotels in Muscat mark a significant milestone for Wyndham Hotels & Resorts, as we seek to expand our presence in this increasingly important market and support Oman’s ambitious Vision 2040 tourism program. As the world’s largest hotel franchising company, we are particularly focused on helping to develop the country’s mid-market hotel sector and creating more job opportunities for the people of Oman.
Our expansion marks the introduction of two new brands to Oman – Wyndham Garden and Ramada Encore by Wyndham. The unrivaled locations of the hotels in the heart of Muscat’s business and leisure district makes these the perfect properties to complement our growing offering in the region, and underlines our commitment to strengthening our presence in this important market.
Focusing more broadly on the Middle East – what is Wyndham’s short-term and long-term outlook/vision for the Middle East?
With the enormous opportunities that this region offers, we have an optimistic outlook for the future. Through our diverse portfolio of brands, our vision is to make hotel travel possible for all. From economy to upper upscale – and through the rapid expansion of our footprint – our goal is to ensure that whenever and wherever guests want to travel, there is a Wyndham hotel to suit their needs.
Over the past year, we’ve seen tremendous growth and significant signings within the UAE, Saudi Arabian and Omani markets in particular. In this time, we’ve reached significant milestones and continued to expand our footprint – including important new openings and signings, a series of key brand launches and new market entries.
Just last December, we introduced two more of our iconic brands into Saudi Arabia for the first time – Wyndham Garden Damam and Howard Johnson Dammam Cornish Street. 2018 also saw the launch of two other hotels in KSA (Ramada by Wyndham Al Khobar King Abdullah Street & Ramada by Wyndham Dammam Khaleej Road), further strengthening our offering within the important mid-market sector in the Kingdom, bringing us to 15 operational hotels and over 2,300 rooms – with 5 more properties and over 1,000 additional rooms in our development pipeline.
We also recently announced three new hotels in Dubai as part of the Deira Waterfront Development by Ithra Dubai, under the Wyndham (282 rooms), Days by Wyndham (131 rooms), and Super 8 by Wyndham (90 rooms) brands (the first Days Inn and Super 8 properties in the UAE).
With 54 operational hotels and over 10,000 rooms in the MEA region, and a robust pipeline of 23 additional properties and over 4,600 planned between now and 2023, we see substantial opportunities to further expand our reach – particularly within the mid-market sector. We will continue to build on our presence and strengths by focusing on growing our portfolio where we know travelers want to be – and several regional destinations are at the top of the priority list of international travelers.
Can you give an update on current projects in the UAE?
We are proud to have overseen a number of important brand entries in new markets across the region over the past year. In particular, we’ve seen tremendous growth and significant signings within the UAE and 2020 is shaping up to be another momentous year.
We are continuing to make great strides in the mid-market sector in Dubai. We are seeing great momentum in Deira, where this year alone we opened Ramada Plaza by Wyndham Dubai Deira (250 rooms) and Ramada by Wyndham Dubai Deira (173 rooms). We have also recently announced the upcoming opening of three new hotels as part of the Deira Waterfront Development by Ithra Dubai, as I mentioned. When opened, these will bring two new brands – Super 8 by Wyndham and Days Inn by Wyndham, and an additional Wyndham hotel. The development also represents the introduction of the first ever Super 8 and Days Inn hotels to the UAE.
Situated along the Dubai Creek in the southern part of Deira, the area features communal facilities and public amenities, which will create a dynamic urban community and deliver growth opportunities for the city. The addition of the three new hotels will also draw domestic and international business and leisure visitors looking for accommodation suited to a range of budgets.
In 2018, we signed an agreement to open our first Wyndham Garden in Dubai in 2020, signalling excellent growth for one of our most popular brands in the city which will also be our second one in the UAE. Finally, the Ramada Plaza Jumeirah Village Circle is also set to open in 2020.
Wyndham Hotels & Resorts has been built by acquisitions – are there any plans for further expansion at this stage?
In 2018 we completed the acquisition of La Quinta – including over 900 destinations in North and Latin America. Acquisitions have enabled us to complement our portfolio and accelerate our global scale. We are, however, not in a position to comment or speculate on potential future acquisitions.
There has been talk of saturation at the top/luxury end of the market – has this been the case for Wyndham Hotels & Resorts?
In the GCC and wider Middle East region, the industry remains focused on the up-scale segment, with a ratio of mid-market to luxury hotels at just over 50%, compared to other mature destinations like New York, where the average ratio is 70:30 (mid-scale to luxury). Internationally branded three-star economy hotels and mid-market offerings continue to be underrepresented here, despite increasing demand within this segment.
At Wyndham Hotels & Resorts, a critical part of our strategy in this region has been to focus on addressing this demand by introducing more of our economy and mid-scale brands, as well as extended stay hotel suites. We have continued to reinforce the presence of our mid-scale brands, including the Ramada brand, which at over 30 locations across the Middle East and Africa, has become one of the most well-known mid-scale brands in the region, and a core brand for Wyndham Hotels & Resorts.
In 2017, we opened the largest TRYP by Wyndham in the world in Barsha Heights, Dubai, with 650 rooms. We also introduced Wyndham Garden in Manama, Bahrain, which is the largest Wyndham Garden in the world with 441 rooms, and brought the brand to Ajman, UAE, and Dammam, Saudi Arabia.
We want to be the region’s leading player in the mid-market hotel segment, striving to elevate the experience of the everyday traveler. We will continue to leverage our solid foundation and experience a global hospitality powerhouse, as well as our ambitious expansion plans, to further grow our mid-scale footprint across the Middle East region and help bridge this gap in the sector.
What is your opinion about the current supply in the Dubai market? And taking Expo2020 into consideration, how do you feel Dubai will fare post-event?
When you look at future room supply in the emirate, the majority of it falls within the four and five-star category. However, the issue of oversupply is not really an issue if you target the right segment. By this, I mean that any developer or hotelier taking on a new project in any region should be looking at where they can bridge the gaps in that particular market. This is what we have focused on doing here in the UAE and wider Middle East with our focus on the mid-market and economy sector.
Looking ahead to Expo 2020 and beyond, while a natural downturn can be expected following an increase in supply ahead of any major event, we expect this to very much be in the short-term as additional supply gets absorbed. With the increase in visitor numbers year-on-year and growing demand in the mid-market sector, particularly from high-growth markets like India and China, we believe Dubai has the potential to continue to be a popular destination post-Expo 2020.
In fact, its history of successfully diversifying itself as a tourism offering leads us to remain very optimistic that any downturn will be followed by a more positive uplift in the market as the region continues to draw visitors to our shores in the years to come.
At the recent Wyndham Hotels & Resorts Global Conference, Wyndham unveiled plans to add further value for franchisees and further grow the business. Can you tell us a little more about that?
As the world’s largest hotel franchisor, our commitment to making hotel travel possible for all starts with our franchisees. Earlier this year at our global conference, we unveiled several initiatives designed to elevate our brands, deliver incremental resources to our owners, grow our presence and meet the needs of today’s travelers – with a focus on enhancing returns for our nearly 6,000 franchisees.
These included leveraging new technology to expand our digital efforts to drive brand recognition and contribution and enhance the guest experience across our portfolio; prioritizing new construction and design with the launch of both new and refreshed prototypes designed to lower development costs and capture greater efficiencies and driving global growth to capitalize on the rising demand for all travelers, in particular the growing global middle class.
Through this commitment to innovation in quality and design, operational efficiency, strategic growth and guest experience, our focus is on shaping not only the future of Wyndham but the legacy of our owners around the world.
Are there any plans for new brand entries or expansion into any new markets within the region?
We have seen dramatic expansion of our presence across the UAE, Bahrain and Saudi Arabia and other key markets, and with a robust pipeline in place we see substantial opportunities to further expand our reach across the region – particularly within the mid-market sector.
As I mentioned, this year will see the debut of the Super 8 and Days Inn brands to the UAE, as part of the Deira Waterfront Development by Ithra Dubai project.
We will also introduce more hotels in Iraq with the Ramada Hotel & Suites Najaf and Ramada by Wyndham Erbil Gulan Street.
We’ll also continue to further expand our presence in Saudi Arabia, where we expect to reach to 20 operational hotels and over 3,000 rooms by 2021.
Within the wider MEA region, Africa is steadily developing into one of the world’s great regions for travel, and we are strengthening our presence in this market too. In 2016, we opened our first hotel in Ethiopia – Ramada Addis Ababa – and have plans to introduce three more hotels in the next three years. Ethiopia is an important growth market for us, and we have plans to open three additional hotels within the next four years under the Wyndham, TRYP by Wyndham and Wyndham Garden brands. Africa is a key development market for us, and our pipeline over the next three years includes a number of further openings and market entries in Benin and Senegal.