It’s important when talking about hotels in the Middle East to take a step back and really look at the history of our industry in the region. Hilton’s first property in MENA was in Egypt, opened on the Nile in Cairo in 1959. Having been in the country for 56 years, it’s safe to say we’ve seen a thing or two and weathered a few storms.
The country has certainly had an exceptionally difficult ride recently. If we look at the four years since the revolution, up until the beginning of 2015, things were really not great at all – across the board, the economy was in a bad shape and, of course, broader regional uncertainty is affecting the whole Middle Eastern hospitality business.
We’re now operating 15 hotels in total, with six new properties in the pipeline, of which two were signed this year. Those two projects are based around the Ain Sokhna resort city on the Red Sea. We like the area because we can attract a range of audiences: on weekends and public holidays, you get the leisure component, and during the week, we attract a lot of business and corporate clients that want to do retreats, conferences and what have you. We also get a lot of interest from weddings.
Really, we’re interested in those key areas in Egypt for our package deals that we put together for clients, but our focus is still firmly on Cairo. It’s extremely important to have hotels in the capital because tourists aren’t just interested in sun and sand – they want cultural tourism, they want to visit the pyramids at Giza, to visit Luxor, Aswan, and once you’ve seen them, you can fly to Sharm el-Sheikh and the other resorts for the beaches.
It’s interesting to look at how our brand identity has developed as the investment climate has improved. The majority of our hotels are Hilton-branded, but now that owners are getting more educated on the others in our portfolio, we’re seeing more leads for, say, Doubletree and Hilton Garden, which we think really fits with these new economic cities under development. So there really is a diverse approach when it comes to developing and growing our footprint in the country.
We’re still on the hunt for a great location, with a great partner, to develop one of our luxury brands – either Conrad or Waldorf Astoria. I think there’s real demand for something like that in the coastal cities as well as in Cairo. We just need to find the right people to work with. There are a lot of activities that we’re really excited about.
Improving situation
Of course, the recent bombing of Metrojet Flight 9268 above the Sinai desert came as a terrible shock to everyone. There’s no doubt it’s a tragedy. In the short term, these things always have a knock-on effect on tourism and the hospitality business.
As far as the security of our guests is concerned, we’ve got a very good approach when it comes to managing our hotels in these kinds of conditions, so we’re very hopeful that the situation will pass and that, in the next few months, things will stabilise.
The Egyptian Government’s role in this improving situation really shows the part the public sector can play in rejuvenating flagging hospitality, and their objective is to bring in around 20 million tourists by 2020. They’re extremely supportive. Tourism contributes a good chunk to overall GDP, so it’s certainly not a small portion of the country’s income. This is why the state is focused on helping us bring so many hotels across the line – a property of 200 rooms would create 150 new jobs, which is quite significant.
And it’s not just us: other operators are growing their footprint at the same pace.
Since Sisi became president, we’ve seen a push from the Egyptian Government to promote investment in hospitality development in the country: at the latest economic development conference, there was a great deal of interest from regional players, investors from the UAE, Saudi Arabia, Qatar and other GCC countries. It really seems like investment is finally moving everything in the right direction, despite the complexity of everything that’s going on in the Middle East. Looking ahead to next year, Egypt’s going to be a real focus of ours, more than ever before. Since 1959, it’s been very close to our hearts, and that’s not about to change any time soon.
