TBY talks to Gerald Lawless, President & CEO of Jumeirah Group, on the new Venu brand, the impact of new three- and four-star hotels, and expectations for the future.

How would you describe the dynamic between the traditional Jumeirah Hotels brand and the new Venu brand?

The original brand of Jumeirah STAY DIFFERENT has always been the foundation of the Group. We are continuing to develop that brand very successfully on a regional and international basis. Venu, the newest hotel brand that we have launched, is a contemporary lifestyle brand and is very much aimed at competing within the lucrative lifestyle segment. The target audience for the Venu brand might be slightly different, but not necessarily younger than the target audience of Jumeirah STAY DIFFERENT. We see the two brands complementing each other. Having a desirable location is very important for a successful hotel. We could have a Venu hotel in a highly desirable location, which might actually achieve a higher average room rate than a Jumeirah hotel at certain times of year; therefore, it is not necessarily meant to target more budget-conscious travellers. From an investment perspective, with Venu we are more flexible on room size depending on the style and feel of the hotel. While with Jumeirah we usually have a minimum 50 sqm requirement for a room, we would be prepared to consider a room size of 32-35 sqm for the Venu brand.

What is the strategy behind your food and beverage division?

We are very excited to have launched a dedicated food and beverage division, which is essentially a separate company with 32 restaurants located in our hotels in Dubai. It rents space within our hotels and operates outlets as standalone restaurants. We wanted to give the guests of our hotels the feel that when they use one of our restaurants it is similar to going into a restaurant that is not part of a hotel operation. We offer them a different dining experience, with exceptional cuisine, a dedicated service team, as well as a distinctive concept and theme that is unique to that particular restaurant. The company includes a large portfolio of brands, with the Noodle House being the most widespread. That is a brand we are continuing to develop and roll out across the world on a franchise basis.

“We are very excited to have launched a dedicated food and beverage division."

Regional and international expansion is of high importance to the Jumeirah Group, and you have representation now throughout North Africa, the Middle East, Europe, and the Far East. Which international markets really present the greatest opportunity for growth?

I would say Asia continues to be a very interesting source of business for potential hotel development. When we look at places such as China, it is busy but we could expand our Venu portfolio there. There are still opportunities in China as we are not yet present in Beijing, Dalian, or Tianjin, for example. These are all big cities that could easily host a Jumeirah hotel. I would like to do another hotel in Shanghai in addition to the already successful Jumeirah Himalayas Hotel. Likewise, Vietnam and even Cambodia have good potential; we already have a resort under development in Bali, and Indonesia in general offers attractive opportunities. We aim to be in Malaysia as well. Therefore, Southeast Asia and China are very interesting. The Middle East is of prime importance, particularly the UAE and Saudi Arabia. I see great potential in Africa, especially for Venu. We have already signed an MoU for a project in Angola, and I am interested in looking at South Africa and West Africa. I went to Abuja in May 2014 and was impressed with what I saw there. I believe the West African region has great potential for Jumeirah, particularly thanks to our colleagues at Emirates who offer good connectivity between the two regions. In East Africa, I see opportunities for resorts in places such as Kenya and the Seychelles, in addition to the Jumeirah resort in Mauritius, which is already under development.

Considering the expected influx of three- and four-star hotel investments, how do you see the hotel industry in Dubai evolving over the next couple of years?

I think it makes a lot of sense. Any mature market needs to have a complete range of products in terms of the styles and types of hotels. Different people travel at different times and stay in different properties depending on their needs. As Dubai expands and develops its tourism products, including theme parks and other activities that give people a reason to come, they might not always want a high-end hotel; a budget hotel may suit their needs better. You need to have both, and with the growth in numbers of travellers coming to Dubai, I think there will be a great need for more affordable hotel options. The other interesting thing is that Dubai has always maintained a very high-quality image and I think it will continue to do so. Therefore, some of these budget hotels will be the best in class, and that is what Dubai always aspires to. Also, a variety of products is vital for the industry to mature, develop, and thrive.

How do you see that affecting the World Expo 2020 and its targets?

We are very confident if you look at the hotel development pipeline in Dubai at the moment and the number of rooms that have been planned. In addition to hotels, we are also taking into account the number of serviced apartments coming online, which means Dubai will be well placed. I am happy that we have a target to achieve 20 million visitors before World Expo 2020 because, once the Expo is over, we will be able to sustain that organic growth pattern.

Of course there are lofty targets for the buildup to 2020. However, there is also a lot of concern for 2021. What are your expectations given the climate right now?

Just imagine if we had 20 million visitors coming in by October 2020, followed by 25 million visitors for the six months of the Expo. As a result, other visitors will not be able to get into Dubai that easily, so there will be considerable increase of demand coming out of 2020. Hence, I think there will be a balance. I do not see a huge number of people being turned away in 2020, but hotels will be at capacity with maybe 25 million people per year. I do not see the graph going along and then suddenly falling off the edge, because of the strength and depth of the tourism market already. Dubai will be able to continue its evolution and growth pattern of visitors subsequent to 2020. This is particularly the case when you look at the continued growth Emirates and the expansion of its fleet of wide-bodied aircraft, and the routes it will serve globally. Having said this, I do not think we can be complacent. We must work hard to promote Dubai and continue stimulating demand.

© The Business Year - January 2015