|Middle East and North Africa Business
Report, Amman, Jordan
Knight Ridder/Tribune Business News
May 1, 2006 - Istithmar Hotels, a subsidiary of Istithmar PJSC -- an international investment house based in the United Arab Emirates, has signed a Master Franchise Agreement with easyHotel Limited to open a chain of budget hotels across Middle East, North Africa, India and Pakistan. It recently announced its plans to open eight new budget hotels across major metropolitan cities in India over the next four years. easyHotel.com, a household name all over Europe with a strong reputation amongst budget travelers all over the world, is part of the easyGroup of companies based in London which also includes easyJet. All easyGroup companies were founded by Stelios Haji-Ioannou, the serial entrepreneur.
The alliance's plans to open hotels in the region follows the marked growth in demand for branded budget hotels coupled with the boom in pan-Arab and regional tourism. Istithmar's tie-up with easyGroup, is in line with the inherent demand for such hotels in the region. The agreement with Istithmar will now expand the easyHotel brand across the Arab-speaking world as well as the Indian sub-continent. This matches the market demand for branded budget hotels in view of the exponential growth in the mid-scale segment across these regions and will help to maintain visitor growth in the years to come. The specific countries where easyHotel.com will be present are: Dubai (6), India (8), Saudi Arabia (3), Pakistan (3), Lebanon (2), Egypt (2), and one each in Sharjah, Kuwait, Bahrain, Oman, Abu Dhabi, Ras Al Khaimah, Qatar, Morocco, Turkey, Syria, Libya, Jordan, Tunisia and Algeria. 8 of these hotels will be operational by the end of 2007 and a further 18 will be operational by the end of 2008. The remaining 12 will be operational over the following 3 years. Each hotel will contain between 80 and 120 rooms.
Talking about the regional expansion plans, Mr. Muneef Tarmoom, CEO of Istithmar, said: "Last year, Dubai witnessed over 5 million inbound tourists. Research conducted by Istithmar has identified a significant gap in the market for budget hotels, with over emphasis on the luxury end of the market. We are happy to announce that our alliance with easyHotel.com is aiming to open a total of 38 budget hotels across the regions. The Middle East along with key gateway cities and emerging markets remains our core focus areas. Being a Dubai-based company we can bring expertise to the easyHotel project beyond Europe and meet the demand for quality, competitively priced hotel accommodation in the regions of our agreement."
Speaking on the launch, Joe Sita, CEO, Istithmar Hotels said that Istithmar Hotels will tap into the burgeoning requirements for budget hotels in the Middle East. "The average room rates across key markets in the region have been steadily on an uptrend. The easyHotel.com would be adapted to the needs of the region, given the spurt of visitors for Meetings, Incentives, Conferences and Exhibitions (MICE) segment," he added. In his comments, Stelios said: "easyHotel.com is all about low costs and high efficiency and offers our guests well-equipped, clean and safe, en-suite facilities in urban centres, where customers can accept a smaller space for a smaller price. Our expansion into the Middle East, North Africa and the Indian sub-continent will be managed by Istithmar Hotels and demonstrates our company's strategy of building our brands globally by working with world class partners like Istithmar PJSC."
He continued, "The easyHotel.com agreement with Istithmar continues the easyGroup brand value of making a difference in people's lives in this instance by making hotel accommodation more affordable. It also capitalises on the global growth of budget travel whilst avoiding the political or regulatory hurdles which can be faced by airlines." easyHotel.com opened its first hotel in London in August 2005 and a second one in Switzerland in September 2005. It offers the short-stay travellers a safe and quality option to spend nights at economical rates. Designed for city centres, it offers consumers a recognised brand that delivers a standardised high quality product and banks on customers accepting no-frills and simply furnished rooms. All easyHotel.com bookings are taken by credit card through this website.
Istithmar recently announced the launch of Istithmar Hotels, a subsidiary formed to oversee investments in the hospitality and leisure sectors. The group is tapping hotel properties across the globe, with key investments being made in gateway cities such as New York and London as well as select emerging markets.
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Copyright (c) 2006, Middle East and North Africa Business Report, Amman, Jordan
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