Tuesday, April 28, 2009
State of Independence
by Joe Brancatelli | See Archive
The sale of the 230-year-old Greenbrier Resort to Marriott raises a big question: Can any luxury hotel or resort thrive—or even survive—as an independent property?
The 720-room Greenbrier resort sits on 6,500 acres in rural West Virginia.
Photograph courtesy of: Greenbrier
The moment I first laid eyes on the Greenbrier Resort in 2004, I blurted out what I thought was an incredibly obvious observation: "This," I said about the 6,500-acre, 720-room hideaway in rural West Virginia, "will make a great Marriott one day."
My guide, who worked for an outside PR firm hired to revive the resort's flagging reputation, was aghast. She gamely protested the accuracy of my first impression and insisted the Greenbrier was above the unabashedly commercial, cookie-cutter nature of chain hostelries. But as I wandered around still-icy golf courses, inspected florid guestrooms and outdated public areas, and noted archaic house rules (the only dining room required a jacket and tie), I was convinced that the Greenbrier would never survive as an independent.
Well, the 230-year-old lodging icon has succumbed. The owner, railroad company CSX Corp., put the Greenbrier into Chapter XI bankruptcy in late March, claiming $90 million in losses during the last six years. And CSX promptly called in—you guessed it—Marriott. CSX is so desperate to unload the hotel that it will provide Marriott with as much as $50 million to operate the Greenbrier during the first two years. Marriott will then buy the resort within seven years for between $60 million and $110 million. Pending bankruptcy court approval, the deal could close by summer.
Now, no one is aghast at the prospect of a chain running the Greenbrier. The unions seem amenable to Marriott's arrival. West Virginia governor Joe Manchin publicly applauded the deal. Newspapers statewide have cast Marriott's arrival as a "rescue." And locals in hardscrabble Greenbrier County support anything that will save the resort's approximately 1,300 jobs.
Like all luxury hotels that have hit the economic and emotional skids, the Greenbrier's tale is unique: CSX has been a distracted and ham-fisted owner, battling both the hotel's unions and the resort's former president, who sued for $50 million. The sprawling resort is physically isolated and expensive to operate. (CSX recently spent $50 million on improvements in a misguided attempt to regain the fifth Mobil Guide star it lost in 2000.) And despite the loyalty of generations of repeat visitors and fanatic golfers, the Greenbrier was disproportionately dependent on corporate meetings, a travel category that has been devastated by the weak economy and the "AIG Effect."
But the Greenbrier's sale to Marriott also raises a more universal question: Can any luxury hotel or resort thrive—or even survive—as an independent property? In a world where a handful of global hotel chains—Hilton, Marriott, Starwood, Hyatt, Accor of France, and InterContinental of Britain—dominate the lodging market, can a single property, no matter how famous, stand alone?
At least on the surface, the answer is no. About half of the properties on the Condé Nast Traveler Gold List and half of those that earn the prestigious five-star rating from the Mobil Guide are part of chains now, albeit luxury and ultra-deluxe operators such as Four Seasons or Fairmont of Canada; Mandarin Oriental and Peninsula of Hong Kong; Aman Resorts of Singapore; and Taj of India. The Blackstone Group, which owns many of the world's best-known luxury independents as well as Hilton Hotels, is building a deluxe brand too. It is aligning its independents like the Boca Raton Resort in Florida and the Boulders in Arizona with the Waldorf Astoria Collection, which was created by Hilton using the cachet of its eponymous New York hotel.
Other luxury brands have huge corporate parents too. St. Regis is owned by Starwood, best know for its Westin, W and Sheraton hotels. Ritz-Carlton is owned by Marriott. And some luxury hotels you may think of as independent are actually part of a chain. The Plaza in New York, which reopened last year, is managed by Fairmont. The Pierre, which reopens in New York this spring, is operated by Taj. The newly renovated Mauna Kea Beach Hotel on the Big Island of Hawaii is run by Prince Hotels of Japan. The Dorchester in London? It's part of the Dorchester Group, which is aligned with the Beverly Hills hotel, the Plaza Athenee in Paris, and the Principe di Savoia in Milan.
"Chains always outperform" independent hotels, says LodgeWorks' Tony Isaac, a man who knows the industry from both sides of the fence. LodgeWorks manages hotels in the Hyatt and Hilton chains, helped create the Residence Inn brand (now owned by Marriott), and is building its own Hotel Sierra chain.
But Isaac has just built an upscale independent hotel too. The Avia opened in January in Savannah and was promptly named a great romantic getaway by Travel & Leisure magazine. Why does a guy who admits chains outperform independents go ahead and open an independent anyway?
"Chains add about 10 points to your occupancy rate. But if you're part of a chain, you pay 12 to 14 percent for the frequent guest plan, the reservation service, and other brand programs," he explains. "If you're in the right market, it's not too much of an economic disadvantage to be an independent—and then you have the flexibility to do what you wish and manage as you choose."
That's the argument made by Sean Hehir, managing director of Trinity Investments, a real estate firm that purchased Honolulu's iconic Kahala Resort in 2006. The beachfront property opened as a Hilton hotel in 1964 and spent most of its recent history as a Mandarin Oriental. But Hehir believes the Kahala has unique advantages that appeal to the luxury traveler who isn't interested in brands.
"We're not subject to a brand policy that may not have any relevance to a particular property," he says. "We manage for the long-term best interest of us as owners and the luxury travelers as guests."
But even Hehir admits you need the right combination of factors to survive as an independent in today's chain-dominated world. In the Kahala's case, it's the unbeatable location on a sandy beach in Honolulu's choicest neighborhood and the fact that another Trinity principal, Chuck Sweeney, has a long history as a hotel manager. (Sweeney founded the company that became Embassy Suites, now a Hilton brand.)
For James Bermingham, managing director of the spectacular Montage Resort in Laguna Beach, the advantage is a laser-like concentration on guest services and proximity to wealthy, sophisticated travelers in Southern California. Both the five-year-old Laguna Beach property and the new Montage in Beverly Hills (it opened last fall) can tap into millions of upmarket buyers within 60 miles of the resorts.
"The 'staycation' trend helps Montage," he says. "Guests who want an extraordinary luxury experience very close to home see the Montage properties and they know they won't be getting a chain hotel."
The Fine Print…
Most observers think fewer luxury hotels will still be independent after the current recession, but there is a notable dissenter. Michael Matthews, who has been the general manager of top-notch chain hotels (the Ritz-Carlton in Hong Kong) and independent deluxe resorts (the Ventana Inn in Big Sur) thinks high costs will drive some luxury properties out of the major chains. "If you're 'flagged' as a chain, you have no independence at all," he says. "A lot of hotels will drop the flag and take the 14 percent fees they pay and use that money to do what they think makes most sense for their own hotel."
Wednesday, April 22, 2009
By Christopher O'Toole
For lovers of the Mediterranean, self-catering is the best way to enjoy affordable family holidays, and if looking for a change from the favourite haunts in Greece or Spain - with a little je ne sais quoi thrown for good measure – how about heading from the French island of Corsica?
This beautiful French island situated north of Sardinia is less than two hours’ flying time from the UK. Known as the ‘Scented Isle’ because of its abundance of fragrant flowering shrubs, Corsica offers a wealth of beautiful sandy beaches, a rugged interior, and fine French dining as well as more fun food for the kids, lively nightlife and plenty more to see and do.
And that includes doing very little if all you want to do is relax!
So if want to make sure you can afford more of the things this lovely island has to offer, self-catering apartments in Corsica are the smart choice, especially if you’re a family with young children.
Hit the Beach
It’s Corsica’s miles and miles of golden, sandy beaches that keep people coming back to this magical Mediterranean island. And with over 200 beaches to choose from you’ll be spoilt for choice. They’re remarkably clean, even the beaches close to the towns, and that goes for the water, too.
If you want to get away from it all, you’ll find peachy little beaches tucked away in rocky coves only accessible by boat, while other (more secluded) beaches can be reached along winding coastal paths.
But if you simply want to kick back and take in some rays, you’ve come to the right place. The beaches are so spectacular that a recent survey said that five out of six visitors to Corsica can never tear themselves away from them. But if you’re one of the dedicated few who can, there is plenty to see and do.
Warm water, sunny weather and gently shelving beaches make Corsica an aquatic playground. Corsica boasts some of the best conditions for windsurfing, snorkeling, diving, sailing and fishing to be found anywhere in the Med.
Meanwhile, back on dry land, the more adventurous can try paragliding, quad-biking and bungee jumping, which are just a few of the more extreme adventures you can experience in the rocky interior.
The island’s capital is well worth a visit. Built by the Genoese in the 16th century, today it still stands as a proud citadel. The old town perches on a dramatic hilltop, overlooking the yachts and other pleasure boats that now fill the harbour below.
In the narrow streets, café sitting and menu browsing is the order of the day, while watching the local fashionistas walk by. Seeing and being seen is a local sport – Corsica is a mix of French and Italian influences, after all.
Food & Wine
That mixture of French and Italian traditions is also apparent in the local cuisine, creating something quite unique in Mediterranean cooking.
As you might expect, coastal areas are great for fresh seafood, with red mullet, sea bream, crayfish and oysters particularly good. While inland you’ll find good, earthy food - with wild boar and roast partridge more the order of the day.
Corsica also produces its own wines, which are little known outside of the island. The locals say it’s too good for anyone else. The grape harvest here is still cut by hand. Try one of the local fortified wines such as Muscat, or the darker, sweeter Cap Corse. Perfect as aperitifs, they can also be drunk throughout the day as the mood takes you.
And if you’re visiting in mid July, why not check out the Corsican Wine Festival in Luri.
You’ll find everything from top quality restaurants to laid back local watering holes and cheery cafes serving pizzas in Corsica, so there’s something for everyone. Children are always made especially welcome, and most venues have high chairs and special children’s menus.
Nightlife in Corsica tends to be pretty laid back with long, lazy evenings in restaurants top of the bill. However, the larger towns such as Porta Vecchio, Calvi, Ajaccio and Bonifacio have late night bars and nightclubs.
Nearly every town and village in Corsica will hold a festival at one time or another, usually during the summer months, with music, eating, drinking, markets and quite often fireworks. They’re great fun, give a real insight to traditional ways of life on the island, and visitors are always made welcome. Local tourist offices will give you an up to date list.
French self-catering holiday specialist, PV-Holidays has comfortable apartments in Corsica, including the charming Résidence Aria Marina near Mancinu beach. For information and other latest deals, visit PV-Holidays.