STAMFORD, Connecticut—After relatively sluggish growth in recent years, Starwood Hotels & Resorts Worldwide’s full-service Le Méridien brand is poised to move forward with a stronger, sleeker portfolio.
The brand recorded a 3% increase in revenue per available room during the first quarter of 2012, behind gains of 9.4% for sister brand Aloft, 8.5% for W Hotels, 7.2% for Westin, 6.4% for Four Points by Sheraton, and 5.2% for Sheraton, according to the company’s first-quarter earnings report. Only St. Regis/Luxury Collection reported lower RevPAR growth at 2.7%.
Starwood Hotels CEO Frits van Paasschen recently attributed that muted pace to economic and political troubles in Europe, the Middle East and Northern Africa, which contain the lion’s share of Le Méridien properties.
But the brand is bouncing back, according to Vincent Gillet, who recently took the post of global brand leader for Le Méridien as well as W.
“Performance in Europe within the business has been considered an uptick from last year,” he said.
The Paris-born Le Méridien is refocused now. Starwood has shed some 45 properties since acquiring the brand in November 2005. Of the remaining 99 properities, 10 have been renovated and another 30 are on tap for renovations in the coming years.
Starwood Hotels &
“There was a major thrust and drive to let go of some of the properties. We’re still losing some now. It’s a cleaner portfolio,” Gillet said.
The base has been bolstered, and the brand is now ready for expansion, he said. Thirteen new Le Méridien hotels are set to open during the next three years. Throughout the remainder of 2012, the brand will add locations in Bali, Indonesia; Zhengzhou, China; Saigon, Vietnam; and Mahabaleshwar, India, among others.
Targets for expansion include Asia and the Middle East, although Gillet did not rule out the United States. Starwood opened up the Le Méridien Arlington outside Washington, D.C., last year.
But while the portfolio might look different, the mission of Le Méridien is the same, Gillet said. The brand emphasizes art and culture, featuring installations, paintings and photographs to reflect the authenticity of the surrounding destination while encouraging guests to see it from a new perspective.
Customers are responding well, Gillet said. Both guest satisfaction scores and RevPAR for Le Méridien have never been higher.
A facelift for W
As the Le Méridien portfolio sheds some fat, a few select W properties are getting a facelift.
Starwood announced earlier this month that 10 of its most iconic W hotels throughout North America will undergo renovations within the next 18 months. The renovations, which vary by hotel, are slated to include cutting-edge updates to public spaces, new signature bar and restaurant concepts, and stylish revamps to guestrooms.
Starwood and its ownership groups, including Host Hotels & Resorts, Rockpoint Group and Estein & Associates USA, have committed more than $100 million to the renovations.
The expenditure is a necessary step to maintain the integrity of the assets and keep them culturally relevant, Gillet said.
“What you drink and what you eat is a very personal thing. It’s typically influenced by where you come from,” he said. “Hospitality is very similar. You’re hosting people.”
As such, a lot of those renovations will address the public spaces and bar areas of the W-branded hotels—which are key points of differentiation for the brand, Gillet said.
The W brand comprises 42 hotels in key gateway cities throughout the world, including 14 W-branded residences.
New W Hotels have been announced for Guangzhou; Milan, Italy; Shanghai; Singapore; Abu Dhabi, United Arab Emirates; Bangkok; Athens—Astir Palace; Muscat, Oman; Mumbai; and Santa Fe, Mexico. The brand is on track to reach more than 60 properties by 2015, he said.