HOTI HOTÉIS WANTS TO ENTER SPAIN WITH THE STAR INN BRAND
Hoti Hotéis aims at expanding internationally by entering Spain. The Portuguese hotel group, which currently has 17 hotels in the portfolio, wants to take the Star inn brand to the neighbouring country. At present, only one hotel outside Portugal has been under the management of the hotel chain since September 2018, Meliá Maputo Sky, in Mozambique. The international growth strategy is now focused on an Iberian perspective.
“A range of new opportunities is opening up, which may bring about the possibility for more locations to bear the Star inn brand, not only in Portugal but also in the Iberian territory. The Star inn brand already boasts a certain logic of development that enables it to be set up in a nearby destination, thus somehow creating a logic of expansion. There is no point in having a set of hotels in Portugal and then develop hotels in a far-away capital city. It is useful that we grow within geographic distances that are not too far apart”, Miguel Caldeira Proença stated to Publituris Hotelaria.
The CEO of the Group has also said that the search of opportunities in Spain has already begun and that the country’s capital, Madrid, or the Galicia region are likely destinations to make this leap abroad. “The successful development of the Star inn Peniche Hotel allowed to do what does not happen often, i.e., the possibility of developing a three-star brand that operates in the leisure and urban segments. This allows more flexibility in the development process. I believe it is easier to hold on to a faster development with urban products and, within that perspective, Galicia or Madrid are the most likely options. It will depend a little bit on the opportunities that will show up, and we need to always take into account that we are talking about a controlled cost product with fewer opportunities”, he stated further.
Miguel Caldeira Proença admits that Spain “is traditionally a difficult market” and that is why the Portuguese group may aim initially at finding hotel assets that are ready to operate. “We are not considering the development issue, but rather lighter and faster ways of entering the market. It may make sense to find hotels that have abandoned a certain brand and whose values may enable the Star inn brand to get in, although that entails a rearrangement of the hotel to make it consistent with the brand’s remaining values”, he clarified.
The Group currently has three Star inn brand hotels in Portugal: in Porto, in Lisbon and in Peniche.
Hoti Hotéis is ending the year with an overall drop of 49 million euros in revenues
The accounts for 2020, which is about to end, are already done. The hotel group is ending the year with 26 million euros in revenues, which accounts for an overall drop of -65% as compared to 2019, when it posted 75 million euros. In the wake of the COVID-19 pandemic that battered the Portuguese hotel sector, Hoti Hotéis posted an annual revenue in December of 10 thousand euros per room, an amount that is nearly three times lower than that of 2019 (29 thousand euros per room).
The Group’s hotels in the large urban centres were those with the worst performances, as occupancy fell by 77% in Porto and by 70% in Lisbon and Madeira. In the Minho province and in the Centre of Portugal “the fall was less sharp, but always higher than 50%”, according to the CEO.
“We entered the pandemic with a good level of financial soundness, which helped us control the degree of anxiety and panic when faced with the grinding halt in demand. The Group had a net debt /EBITDA ratio of around 1x. This is a good value in any economic activity, and which we perceive, in the hotel business, as a good indicator of the work we did in previous years, because it allows us to control the evolution of debt and to maximise the return of the several operations we had”, Miguel Caldeira Proença pointed out.
Looking ahead to 2021, Hoti Hotéis estimates, for the coming year, a recovery between 40% and 50% of the turnover lost in 2020. “With an increased capacity following the addition to the portfolio of Hotel Moxy Lisboa Oriente [whose opening is scheduled for April], our supply will increase to 2686 rooms, up from the current 2464 rooms. Therefore, with that overall capacity, we are aiming at closing 2021 with an overall revenue of 50 million euros”, he concluded.