Morgans reveals plan for more Middle East hotels
Letters of intent signed for two further hotels
Morgans Hotel Group has signed letters of intent for two more hotels in the Middle East, adding to the property it is already set to open in the region next year.
The company, which specialises in lifestyle boutique hotels in select resort markets, will make its Middle East debut in the second quarter of next year with the 270-room Mondrian Doha.
It also has a franchise agreement for 10 Karakoy, a 71-room Morgans Original in Istanbul, Turkey which is expected to open by the end of 2014.
In an earnings call following the release of its Q2 results last week, Morgans Hotel Group interim CEO Jason Kalisman explained how the company would build on its Doha plans.
“We are making solid progress on expanding our development platform. We recently have signed two letters of intent for hotels located in the Middle East," he said, according to a transcript of the earnings call by Seeking Alpha.
“Each of these projects contemplates long-term agreements with no investment needed from Morgans.”
Later on in the call, he expanded on the company's pipeline strategy. "With regards to the pipeline we’re focused on major markets in North America, Europe and the Middle East where we can take advantage of markets where we have scale," he explained.
"We’re primarily focused on management agreements but we’d also consider license or franchise agreements depending on the brand, market and operator.
"Beyond that we would with the right partner look to expand into other areas, but I think as we’ve found in the past if you don’t have the right partner and you don’t have the right scale it’s not very profitable to do that."
Opening next year, The Mondrian Doha will be shaped like a falcon and located next to Lagoona Mall in the West Bay area of Doha.
General manager Ray McShane has previously said that it will compete with the W Doha as the second boutique lifestyle hotel in the city.
“Customers who know Morgans enjoy the unique and engaging experience of our hotels,” he said.
“We like to partner with fashion and music and art in everything we do and our buildings are reflective of this.”
The company's adjusted earnings before interest, tax, depreciation and amortisation in the second quarter of 2014 was $14.8 million, up 17.7 percent increase on the same period in 2013.
This came from total revenues of $61.4 million, up 1.2 percent. Systemwide, revenue per available room (RevPAR) was up 6.4 percent to $256.70, while occupancy was up 3.4 percentage points to 87.8 percent.