PARIS—The “palace” hoteliers are taking an offensive approach to the wave of newcomers in the Parisian market.
“Knowing ahead of time that four other luxury hotels were going to arrive forced us to call ourselves into question even more than usual and has encouraged improvements,” said Didier Le Calvez, general manager of Hôtel Le Bristol Paris.
His sentiments were echoed by Christopher Norton at the Four Seasons Hotel George V. "It has pushed us to take a good, hard look at ourselves."
“At the Bristol, we are going to double the size of the spa and add a new panoramic suite of 2,155 square feet on the eighth floor," Le Calvez said. "This is part of an ongoing major investment programme by the owners, who each year commit €5 million (US$6.4 million) to the hotel’s renovation, with an additional €12 million (US$15.4 million) for these new projects.”
|Upgrades at the Hotel Plaza Athénée include a swanky new bar.
Despite its long-standing status as a palace, the 1925-built Bristol only earned its 5-star rating in June after conforming to the new classification.
The Oetker Hotel Collection has pumped millions of dollars into Bristol renovations during the past three years in order to give the Mandarin Oriental, Paris a run for its money when it arrives on the same street next year. The renovations include: a new wing of 26 rooms and suites; a restaurant, Le Faubourg 114, that opened in September 2009; and 36 rooms have been refitted with another 66 to come.
With the specter of new luxury rivals adding to the already fragile business of living in the ultra-fast-lane of fickle luxury demands, Paris’s haut de gamme hotels must rapidly refurbish their palaces.
Money to burn
Well cashed-up owners of Le Bristol, Le Meurice, Hotel Plaza Athénée and the Four Seasons Hotel George V Paris are investing massively in order to upgrade and enlarge, refit rooms, add more suites and glamorous new restaurants. With an average annual investment of € 5 million ($US6.4) at the George V since its reopening in 2000, General Manager, Christopher Norton, has confirmed that the hotel is about to embark on a 3-year, € 20 million revamp ($US22m).
"A lot of investment and capital have brought the hotel up to the front-line of Parisian luxury hotels and we keep investing heavily to keep it fresh and make it stay up to speed," he said.
“It is essential to invest and to innovate non-stop,” said François Delahaye, director of operations for the Dorchester Collection, whose mantra for staying at the top is “quality, quality, quality.” In Paris, Dorchester manages the Hotel Plaza Athénée and Le Meurice.
Following €15 million (US$19.2 million) spent during the past two years at the Plaza Athénée for room upgrades, new suites and an “ultra couture” spa, the hotel purchased three neighboring buildings to expand its room and meeting facilities during the next few years.
Hôtel Le Bristol Paris
“We are investing huge sums of money,” Delahaye said. “We are not going to just stand by and have our star status stolen from us … We have the most beautiful spa in Paris. The Asians do not have such savoir-faire.”
Industry observers agree the current spending spree is obligatory if the palaces are to maintain their position at the vanguard of luxury.
“Permanent innovation is necessary to gain fidelity from clients at the same time as expand the clientele,” said Horwath HTL’s Philippe Doizelet, a GM in the Paris office.
Beyond mundane needs of maintenance and infrastructure, he said, such innovations include wow-factor decorations carried out by famous designers, eminent new artworks and culinary coups de foudre.
“The redecoration at Le Meurice for example was allied with one of the most seductive names in the design business, that of Philippe Starck, while the new bar at Plaza Athénée has given a huge kick to the hotel’s reputation as has its illustrious pastry chef, Christophe Michalak,” Doizelet said.
Making the renovations count
Any modifications must underscore the palace’s uniqueness, Doizelet said.
“Maintaining a very strong identity is vital,” he said.
Reigning palaces risk being dethroned if they do not keep to the cutting edge of necessary changes, according to Gabriel Matar, director of Jones Lang LaSalle Hotels, France.
“Certain hotels, which have not invested enough over recent years, will no longer make the grade,” he said.
Is the spending frenzy any recognition that the palaces are not entirely up to scratch on international luxury standards?
“Not at all,” said Philippe Gauguier, hotel expert and partner at Deloitte France. “They simply have to satisfy an evolving market and soaring Middle Eastern clientele by adding more suites, restaurants, etc.”
No one can afford to sit on their haunches, Le Calvez said.
“Today, Paris is competing with many places which offer world-class hotels, even those once considered secondary, such as Dubai and the Maldives, have improved enormously,” he said.
“We have no debt, we are in a position to make investments but there are hotels which do not have the financial means. In the past decade we have spent €50 million (US$64.2 million) on improvements.”
With an annual turnover of approximately €500 million (US$642.1 million), the palaces represent an elite 2% to 2.5% supply of the market, according to Jones Lang LaSalle.
Standing in stark contrast to these money-spinning makeovers, is the crumbling façade and turnover of Starwood Capital’s Hôtel de Crillon. The Hôtel Paris Ritz also is waiting for the green light on a long-anticipated renewal.
“A palace will always be a palace,” Gauguier said. “It doesn’t turn into a 4-star just because it’s badly renovated.”