FRANKFURT, Germany—A swell of high-end hotel openings in Frankfurt signals a slow but steady transition for the European banking powerhouse, in which the city’s traditional corporate base is making room for a burgeoning stream of leisure travel.
Notable openings within the last six months include the Jumeirah Frankfurt, Hilton Frankfurt, Hilton Garden Inn Frankfurt and Meininger’s Hotel Frankfurt/Main Airport. A Sofitel is scheduled to open in 2014.
Though business travel still accounts for 70% of overnight stays, new midmarket and luxury hotels are meeting rising demand from leisure visitors, said Thomas Feda, managing director at the Frankfurt Tourist and Congress Board.
“Frankfurt is profiting from an upward trend in culture travel and short city trips,” he said.
The market finished 2011 with a 1.3% in occupancy, a 2.9% increase in average daily rate and a 4.2% increase in revenue per available room when measured in euros, according to STR Global, sister company of HotelNewsNow.com.
“Among the latest hotel openings, there are a few luxury hotels and a higher number of standard and comfort hotels, which reflects the increasing number of leisure tourists and rising demand on midprice categories,” Feda said.
The Middle East has emerged as an important feeder market, he added.
“The Jumeirah, which together with us, did a lot of marketing activities in the Arabic Gulf States,” he said. “The Arabian market is an important market with an increasing number of visitors.”
The 218-room Jumeirah Frankfurt is the Jumeirah’s first hotel in continental Europe. The stunning 25-floor steel and glass tower rises over the commercial and business district on Thurn-und-Taxis Square.
GM Dagmar Woodward said the Frankfurt property is catering to 5-star business and city tourism.
“The Frankfurt market has seen a massive increase in tourism,” he said. “We are responding to this trend by focusing on business and leisure travelers’ needs, with services ranging from complimentary Wi-Fi and state-of-the-art technology to personal shopping, tailor-made city tours and custom spa-treatments.”
The Jumeirah Frankfurt’s rooms and suites, at a minimum 35 square meters (376.73 square feet) are the largest in Frankfurt, while its high-end restaurant, state-of-the-art meeting rooms and 364-square-meter (3,930-square-foot) ballroom, mark the first major competition for the incumbent luxury brand, Rocco Forte Hotels, whose Villa Kennedy opened in 2007.
The competition increases
Villa Kennedy GM Georg Plesser said as the economy goes from strength to strength, so does the competition.
“The Jumeirah is our main contestant for now in the deluxe sector, but competition is not sleeping,” he said. “Established hotels such as the Steigenberger Frankfurter Hof are investing a lot in refurbishment, (and) the Westin Grand has extensively overhauled its dining and banquet spaces—so the market is tough.”
Georg Plesser, GM at Villa Kennedy
The forecast opening of Sofitel in 2014, on a hotly contended downtown site, further underscores Frankfurt’s emergence as a luxury business destination.
“This opening is perfectly in line with the strategy of the group to manage excellent hotels in extraordinary locations,” said Robert Gaymer-Jones, Sofitel’s CEO.
“Sofitel is the next kid on the block in terms of 5-star rivalry,” Plesser said, adding he welcomes the high-end addition.
“The development (of Sofitel) at the Alte Oper (old opera house) is the best business and upscale shopping spot in town. We expressed interest in it a few years ago, then it was earmarked for a Mandarin Oriental last year, but that fell through,” he said.
Despite strong financial years during 2010 and 2011, Plesser said he understands why some developers have cold feet about Frankfurt’s leisure tourism potential.
“The industry here still struggles to operate between Thursday and Sunday,” he explained. “The city is still financially driven, and I do not see an immediate chance for a real flip-over.”
Another project, a Grand Hyatt scheduled to open on the city’s fairground, also disappeared. “Clearly they decided it was not the right spot,” Plesser said.
Airport hotels take off
Some market volatility aside, Feda remains optimistic about the city’s hotel horizons. New hotel openings have far outweighed the abandoned ones, and Frankfurt is experiencing record international arrivals.
According to Frankfurt Airport Media, passenger numbers rose by 6.5% in 2011 to 56.4 million; December arrivals were up 12.2%. The latest tourism statistics show foreign visitor overnight hotel stays climbed 4.4% from January 2010 to October 2011 to 2,4 million.
As a result, Europe’s largest airport is evolving into a major business and leisure hotel hub. A handful of new 3- to 5-star hotels opened there last year, including German brands Meininger and Spain’s NH Hoteles.
In December, Hilton opened the 5-star Hilton Frankfurt Airport and 3-star Hilton Garden Inn Frankfurt Airport at The Squaire building, a futuristic half-mile long, nine-story structure above the airport train station.
Charles Muller, GM of both Hilton airport properties, said the location is a lure for a non-business clientele, especially as Frankfurt becomes a great destination for leisure and cultural tourism, he said.
Charles Muller, GM at the Hilton and Hilton Garden Inn at Frankfurt Airport
“Due to the close proximity to downtown Frankfurt, but also to the Rheingau vineyard region and spa town Wiesbaden, we are seeing a good share of leisure guests staying with us.”
“The Hiltons will especially attract more business guests and conference organizers,” Feda said. Meantime, all hotel sectors and cultural tourism are set to benefit from the upward trend in the Frankfurt hotel market, he said.
“Every luxury hotel opening in the city center proves the attractiveness of our destination for investors. The new competition is good for business and improves the quality and services for our guests,” he said.
One of the main things underpinning that growth is culture—notably Frankfurt’s 14 museums concentrated around the riverside Museum Embankment. For five years, Villa Kennedy has tested the ground for cultural tourism.
“We are an exhibition hotel, and our regulars really love the art. They want authenticity and culture. Three of Rocco Forte’s key values relate to art and design,” Plesser said.
Despite his reticence to proclaim a revolution in leisure tourism, Plesser said there is a distinct switch in dress between Monday to Thursday banking clients and weekend guests.
Both luxury and culture are bait for an increasingly cosmopolitan clientele, he said.
“Currently we have only 30% of stays from the domestic market,” Plesser said. “Our two major markets are the U.K. and U.S. with 20% each, complemented by growing niche markets from the Middle East and South America.”
He expects the same strong “inter-bleeding” of clients between Rocco Forte hotels in London and Manchester from new properties in Abu Dhabi and Jeddah.
Along with Jumeirah, Sofitel and Villa Kennedy, artsy midmarket brands such as the 25hours Hotel and culturally attuned budget group Mövenpick also are propelling leisure stays in Frankfurt.
“Frankfurt has a massive potential as a destination for leisure and cultural tourism, specifically on the weekends,” Jumeirah’s Woodward said. “It is a common goal of all tourism and hospitality related institutions to spread the word on the outstanding facilities and locations the city has to offer.”