The mall-hopper market

A luxury hotel as part of a shopping mall complex? People said it would never work. Just five months after its official opening, however, Kempinski Mall of the Emirates is posting the second highest RevPAR results in Dubai, says general manager, Michael Henssler

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By  Sarah Gain Published  October 19, 2006

HME: What percentage of your guests are from Middle East?|~|Henssler---B.jpg|~|Michael Henssler, general manager, Kempinski Mall of the Emirates.|~|The last couple of months we must have had about 98% Saudis and Kuwaitis in the hotel. At times it’s seemed like we’ve had the entire population of Riyadh here. I think the hotel appeals to these markets because there’s the shopping and the novelty of the ski slope — a lot of people just want to go into the snow dome and feel the temperature, touch the snow and watch the skidoos — the snow ploughs and skidoos are things that people in this part of the world have never seen before. ||**||HME: What is the breakdown of leisure versus business customers?|~||~||~|It’s the school holidays now, so on the rooms side we have a lot of families and we’re really leisure focused. Ask me again in about four weeks time, when the schools have gone back, however, and I think we’ll be just as busy but with corporate clients instead. We’re only targeting the really high-end corporate market, though, in line with our brand image and positioning. Some hotels might be able to let a room go for AED 400-450 (US $110-120) a night, and that would still be viable and profitable for them. For us, however, it just doesn’t make sense. So we’re only targeting the crème de la crème of the [corporate] market, regionally and internationally. Ultimately we’re looking for the split to be around 25% corporate. ||**||HME: How does Kempinski MOE, and Dubai itself, differ from other places you’ve worked?|~||~||~|Dubai is frantic. In Ajman, we have a very successful hotel with very good occupancy. And the lifestyle was nice. We had a nice house, beautiful surroundings, and an enjoyable job. But it was nowhere near as busy or rushed. In Qatar, it was the same thing. It was a wonderful place to live, and a wonderful hotel, but it was nothing the stress we have here. In Dubai there are a lot of demands. Everyone wants your time. You get in the car to go home, and you sit in traffic, and your phone keeps ringing all evening. I don’t know why there is so much pressure here. Everything must be done quickly, and yet everything always runs six months behind schedule. But we are also very privileged to live in Dubai. It is an amazing city and very culturally diverse. The hotel market here is probably the most competitive in the world, so it makes our success all the sweeter.||**||HME: How are you going to sustain the success you’ve had in these first few months?|~||~||~|We’ve done very well so far — we’ve had the second highest RevPAR in town for the last couple of months, so we’re off to a very strong start. We’ve always known that our core business would be the GCC, and the special offers we’ve had have been exclusively for this region, but now that the summer’s nearing an end, we are broadening our reach to some extent. We have no benchmarks to measure ourselves against, as we’re such a unique hotel, so we don’t really know how things are going to play out at this stage. We can’t measure ourselves against the beach hotels, or the city hotels, because we are neither. We’re setting our own expectations, but we’re setting them very high. We’re trying to think creatively and be intelligent about our marketing and we’re cross selling in conjunction with the other Kempinski properties — the one in Ajman and the Emirates Palace. We’re also keeping the interest levels in the property up — there’s still the opening of the chalets to look forward to, probably towards the end of the year. This will pique peoples’ interest and bring us more guests. ||**||HME: The ski chalets are slightly behind schedule. Why is this?|~||~||~|It’s true that the ski chalets have been a bit delayed, but if we wanted to it would only take us about 72 hours to have them open to the public. We’re in no rush, however. We’ve had some issues with the design and construction, again because the chalets are so unique. They overlook Ski Dubai on one side, so we’ve had to handle issues with the insulation on that side. On the other side, however, they look out over the city, so that side of the building is quite hot. It’s quite a balancing act. We’ve had issues with condensation in the rooms because of the varying temperatures, but we sought advice from experts in the UK and Europe, and we have refined the construction to an extent to deal with the problem. There is a great deal of anticipation for these chalets, so we want them to be absolutely perfect when we open them, so that we can make a big impact. Until then, we’re keeping the details a closely-guarded secret. ||**||HME: What are the main challenges of running a mall hotel, specifically?|~||~||~|At the start we asked a focus group of destination management companies, tour operators and so on what features they thought would help them sell this property to our core markets, and we incorporated their feedback at every stage. Because we did our homework, we’ve not too many big surprises. The biggest challenge was probably right at the very start, when we pitched the idea of having a luxury hotel attached to a shopping mall. People thought we were mad. All the other big hotel companies turned their noses up at the idea; they were incredulous about the whole concept. But once we started to lay out exactly who our target demographic was, and why this would appeal to them, people gradually started to catch on. Shopping malls here are like town centres in Europe — they are where people congregate and socialise, the centres of the community. The only difference is that here they are indoors, because of the heat. What big hotel chain would not want a property in the centre of town? Now, of course, all the major operators are queuing up to jump on the bandwagon.||**||

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