RENEWING & STRENGTHENING

Mexico 2016 | TOURISM | VIP INTERVIEW

TBY talks to Roberto Slim Seade, CEO of Ostar Grupo Hotelero, the growth and development of the business and Mexico's tourism industry.

What is your perspective on the growth and current role of Ostar Grupo Hotelero in Mexico's tourism sector?

We have for some years been renewing and strengthening the chain in several respects, from our facilities and staff training to our image, branding, and particularly service. We have taken the same high commitment approach when seeking to be increasingly creative, proactive, and self-critical. This self-criticism reminds us every day that we do not just sell mattresses; we sell an experience. This same revitalization has allowed us to consolidate the already established hotels and grow at a stable pace. In the last five years we have added almost 800 rooms to our hotel offer with the Ramada Gateway in Orlando, Loreto Bay in Baja California, and Yes Inn in Veracruz. In this same period, we have invested more than MXP250 million and have seen favorable and steady growth in our revenue of 22% in 2015 and 16% in the first four months of 2016. These figures give us an optimistic outlook for the remainder of the year, where fortunately we bring a 6% growth in occupancy compared to last year. All of our employees are aware of the importance of tourism in the development of the national economy. All of this obviously brings great economic benefit and job generation, and it is in the context of the nearly 4 million direct jobs related to tourism that we seek to continue actively participating in and strengthening the tourism competitiveness of our country. We are doing our due part through continuous infrastructure investment and employment.

What is the history of Hotel Geneve in Mexico City's hospitality sector?

Hotel Geneve is special for Ostar as well as Mexico City and its history, as it is the most legendary hotel of this country and has been a pioneer of the national hospitality industry. This same story as we well as its legacy motivated us to undertake a robust research and refurbishment project to restore its place as a flagship hotel and landmark of Mexico City that it held for many years. For the hotel's hundredth anniversary in 2007, we wanted to give it a total renovation connected to its classic style while also integrating a fresh new 'Hotel Museum' concept. This is a first-of-its-kind project in Mexico and has delighted our guests, making their stay an experience wherein every corner, hallway, or column gives a permanent and fascinating exhibition with anecdotes. We wanted to refresh the concept that Hotel Geneve has been a tireless innovator in the tourism industry from its inception. It was the first hotel to receive women traveling alone. It was also the first in the country to offer taxi service, dry cleaning, a haute cuisine restaurant, a travel agency, elevators, tennis courts, hairdressers, and a telephone and a bathroom in each room. With a fledgling tourism industry in our country, it was the most modern and elegant hotel featuring a European hotel management system, which was a novel concept in Mexico that was not known. During the 1960s and 1980s, the hotel was falling behind, but after the restoration it is more beautiful and alive now than ever before and has again become an icon of national tourism as the most legendary hotel in the country. It recently received the 2014 Star Diamond Award from American Academy of Hospitality Sciences, the Three Diamond Award from the American Automobile Association, the Golden Keys concierge to the Hotel Geneve awarded by the Union Internationale des Concierges d'Hotels Les Clef's Ohr (UICH), and several others. We are constantly reinventing ourselves, seeking to leverage our past for the benefit of our future direction by combining the tradition of the hotel's corners with the modernity of its time.

How do you see the development of the tourism industry in Mexico?

Tourism in Mexico is going well; the goals are much higher but doing better overall. We overtook Russia to reenter the list of the top 10 countries most visited countries in the world. Mexico still ranks 17th in terms of economic benefit; therefore, we can encourage better schemes to seek higher incomes. Tourism in our country is no longer just sunny beaches; the offer has grown exponentially to attract a wide variety of travelers, ranging from cultural, colonial, and adventure tourism to religious, rural, archaeological, and film tourism, as well as romance and cuisine tourism, retirement, medical, and photo tourism, conventions, and sports. After a 20-year absence from Mexico City, Formula One provides almost 18,000 direct jobs each year and will have an economic impact of more than $2 billion over the next five years. In 2015, we received 32 million international visitors, a number that has been increasing in the last few years. Reaching 50 million annual arrivals is not a far-fetched medium-term goal; however, we must focus heavily also on the local economy, accounting for more than 80% of our sector. There are more than 180 million local travelers who travel only once a year on average. Imagine how the economic benefit could change if this figure increases to two trips per year. It is not a secret that tourism is an important source of income for our country, which in 2015 generated about USD17 billion. It is certainly an important development income tool that represents 9% of the GDP, a figure that can still be higher. In countries such as Spain, this figure reaches up to 12-13%; hence, the importance of this industry and of continuing to put all of our efforts into it.

What is the importance of the acquisition of the Ramada Gateway Hotel in Orlando within the international expansion of the group?

In the last five years, the Ramada Gateway Hotel has had an increase in its occupancy ranging from 7% to 12% annually. Taking into account that it is a hotel with 500 rooms, it significantly contributes to the results of Ostar and has also diversified the offering of the company in the domestic and international markets. Orlando has also reached new records as a tourism destination, receiving 66.1 million visitors in 2015 and consolidating it as the busiest US enclave. It is worth mentioning that the number of tourists doubled in the last 20 years.

What is the growth strategy of Ostar Grupo Hotelero for the next few years?

We currently have about 2,000 rooms in our different destinations, with more than 1,100 employees and around 900,000 guests a year. Our dynamic growth unfolds through finding attractive investment opportunities, identifying synergies with Grupo Carso, and our expansion, which goes hand in hand with Carso Properties. Carso Properties is a holding to which we belong that performs major mixed-use real estate developments throughout the country.