Bartels Births New Brand Concept For Le Méridien; Eyes Going Public

LONDON— With a green light from Japanese parent corporation Nomura International, Le Méridien Hotel Group chief executive Juergen Bartels Friday, August 31, unfurled a corporate plan that will see investment of up to $1.2 billion to create a boutique-style brand within the luxury lodging chain, as the company looks to eliminate debt with an eye toward going public. In an exclusive U.S. interview, Bartels told HOTEL BUSINESS® the design initiative, dubbed Art + Tech at Le Méridien, will create sophisticated, “cutting-edge” rooms, dedicated floors, annexes and brand hotels via new-build projects and major renovations of existing hotels. Prime revamp candidates are Nomura’s 18 Principal Hotels, which were merged with Le Méridien in the wake of its $2.7 billion purchase July 11 from Britain’s Compass Group Plc. “A boutique hotel gets a higher RevPAR than a chain hotel, which has $100 million in marketing [behind it]and the boutique hotel has no marketing other than word of mouth. And who of the chains occupies the territory of boutique hotels? Nobody,” claimed Bartels. “And that’s the territory we’re going to take on.” Bartels said giving guests an innovative brand from Le Méridien will drive greater awareness of the chain. As the name implies, the glass-and-wood minimalist design Art + Tech rooms and hotels will be geared in those directions, incorporating amenities such as 42-inch, wall-mounted Philips plasma screen televisions, guest-controlled electronic adjustable beds, high-speed Internet access, and power showers with 100-gram Hermes soaps. Artwork commissioned for Le Méridien will reflect the individual hotel or market location. “It is built on style and substance,” said Bartels. “It is not only modern, but it is comfortable and interesting. We are raising the ante for the industry.” Groundbreaking will take place Monday, September 3 in Hamburg, Germany and Vienna, Austria, for the first new-construction Art + Tech hotels. Each will have 300 rooms. The concept also will be peppered among Le Méridien’s 38 owned and 88 managed hotels. “We have £360 million ($513 million) for this activity,” said Bartels “I had to sell the board and the banks on the plan, and obviously I did that.” He added he’s going to “motivate and work with the owners of our other hotels and I think there will be a total of £850 million ($1.2 billion) spent under our banner in existing hotels.” Among the first properties being converted is London’s 890-room The Cumberland, a former London Signature property sold in the first quarter for $217.3 million to Nomura by Britain’s Compass Group Plc as the first divestiture of its Forte Hotel group. The property, heading for 1,022 rooms, is being redeveloped at a cost of $100 million, said Bartels. “It will have cool chefs, a cool bar, cool uniforms. I want it to be the coolest hotel in Europe.” Design is being done by Yvonne Golds, a partner in London-based Real Studios. Also currently being transformed here is the 100-year-old The Russell. Of 375 rooms, 220 will be dedicated Art + Tech guestrooms. “We’re combining the past with the future,” observed Bartels. A full floor of the A + T rooms comes on line Monday, September 3 and will be monitored for performance. “I have very great expectations,” said Bartels, noting the renovation is slated for completion in March 2002. Several Le Méridien properties are being prepped for Art + Tech rooms and amenities. For example, London’s The Waldorf in will have 149 A + T guestrooms of its 292 rooms. In cases where extensive renovation cannot be done to the hotel, building annexes will be considered. The brand also is being carved from the majority of the Principal Hotels’ portfolio, acquired earlier this year by Grand Hotels Acquisition Co., Ltd., which was