(Corrected Jan. 24 to clarify partnership timeline in third paragraph.)
Ewan McGlasson, global partner and CEO of Valor Hospitality Partners, said his team’s network of relationships has helped spread the Atlanta-based firm’s property, development and management portfolio around the world.
A deal in the Middle East marks Valor’s latest success in expanding its geographic footprint and is just the beginning of the company’s expansion in that region, he said.
In 2022, Valor partnered with the State Investment Corporation of Dubai to operate the 288-room Radisson Blu Hotel Dubai Deira Creek, the 290-room Wyndham Dubai Deira, the 131-room Days Hotel by Wyndham Dubai Deira and the 94-room Super 8 by Wyndham Dubai Deira.
Valor’s global portfolio now includes 90 hotels, including properties in the US, UK and Europe, South Africa and soon to be in North and West Africa.
McGlasson said he is confident Valor will reach a minimum of 25 to 30 hotels in its Middle East portfolio over the next five years – most added through management contracts with new hotels under construction or existing owners transitioning to franchising.
“I’d like to be more, but again we’re assessing where all the opportunities are,” he said.
The relationship was key to Valor’s latest deal in the Middle East.
First, a contact who worked on landmark hotel projects in Dubai approached the company and said, “Change is coming; new hotels are opening and I really think there is a play for third-party operators,” McGlashan said.
In addition, Valor executives have been in touch with the Investment Corporation of Dubai even before the pandemic, although ICD was courting two or three other third-party companies to move some of its Dubai hotels from managed to franchise, McGlashan said.
“We were kicking [the joint venture] with the takeover of four of their existing hotels with potentially more to come,” he said.
McGlasson said there is no doubt that hotel owners in the Middle East are realizing the benefits of the franchise model as they learn more about it.
It’s something that wasn’t widely advertised in the region in the past because the brands spent a lot of money creating the infrastructure and wanted to control the management of the properties, he said.
“Over time, two things happened. First, owners and developers have become smarter and understand that franchising is the larger business model in the US, UK and Europe. And the second is that they want a full-service hospitality management company like we run because I think they feel like they get more personalized attention, a greater emotional connection with the operator, and they feel like they have a greater control over their assets, whether it’s driving commercial performance or having a bigger say in budgets and approval processes,” he said. “It’s a win-win. As far as I’m concerned, our job is to make brands look really good.”
McGlasson said Valor is being very careful about where it invests and is confident there are more opportunities to get management agreements in the Middle East.
“The region is exploding,” he said.
However, it took Valor a while to even get to where it is now in the region. The process includes meeting with key executives, studying the landscape and learning the types of partners Valor wants to work with, he said.
“You have to be willing to make an investment and you have to be willing to put in the time because there are great owners and some owners you just don’t want to be associated with,” he said.
A key focus at Valor is maintaining a strong employee culture, and McGlasson said the company has been successful in extending that culture to staff at the hotels it manages.
One of the most important things to do is to minimize any fear staff may have about taking on a new entity, he said.
“When we actually go into a region, we have partners and senior leaders and they immerse themselves in everything Valor. We immerse them in our value system, operating philosophy, goals, objectives and mission; we spend a lot of time with them,” he said. “In the case of these four in particular [Dubai] hotels, we have been successful in global resource sharing.”
McGlashan said Valor is forming a global task force to train new teams on the ground. Included in this task force is Valor’s UK CFO, who is now CFO for EMEA.
“We’re just making sure that it will take us a long time to choose the leader for that region, so we have a regional office leader for [the Middle East] now. We weave ourselves into the fabric of what we do there and these hotels have done really well,” he said.
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