Sol searching

London's Meliá White House Hotel represents the first toe in the British water for Spain's biggest hotel chain, Sol Meliá. David Tarpey reports.

The small, Spanish-registered removal van parked outside the Meliá White House Hotel, near London's Regent's Park, gives a hint about what's going on inside. Young men in brown overalls grapple with marble-topped oak cabinets, newly shipped in from the Iberian peninsula to this busy corner of NW1. It's all part of the plan to infuse the hotel with a subtle but distinct Spanish feel.

Forget images of flamenco dancers and the clack of castanets, and think white marble lobby, refined cuisine and a determined effort to make this Grade II-listed building a flagship property for the 350-strong Sol Meliá chain.

The decision to take on the property, which involved £52m to purchase it and more than £30m for refurbishing, was part of the company's global corporate strategy to spread out into key European cities through a mix of purchase, leasing and management contracts. The key strategy for expansion into London, Brussels, Rome and Milan was to tap into the meetings and incentives market.

Melvin Gold, managing director of hotel consultancy services at PKF, says that it is no great surprise that Sol Meliá has now arrived in the UK. "The company has become one of the biggest players in the market, so it's natural that it would want to establish a presence here," he says. "It's part of the whole globalisation trend."

Founded more than 40 years ago by its chairman-owner, Gabriel Escarrer, Sol Meliá is still a family-owned company. It is Gabriel's eldest son, Sebastian Escarrer, who is the determined empire builder. He is also the firm's vice-chairman and executive vice-president in charge of finance and expansion. Under his influence, Sol Meliá has moved beyond the Spanish-speaking world of his homeland and Latin America to many other parts of Europe, although it does not yet have any properties in the USA.

When it took over the White House in 1999 from a private Lebanese company, Sol Meliá inherited a tired property that relied for 60% of its business on tour groups and the leisure sector, at heavily discounted rates. Post-refurbishment, the once cramped, dark lobby is spacious, well-lit and bustling. Two new à la carte restaurants, a new funky bar, remodelled meeting rooms and bedrooms, and a brand new executive lounge, are just some of the features that the company hopes will grab the attention of potential customers.

Bringing in new business is a big priority for Elmar Wirtenberger, the group's new regional director of sales and marketing for the UK, Ireland and Scandinavia. The native Austrian was formerly with Radisson SAS Hotels & Resorts and knows the London hotel market well, which is why he has been charged with raising the profile of the Sol Meliá brand in the UK.

He is a man with ambitious plans. He aims to turn the hotel's 60:40 leisure/business guest ratio on its head, while driving up both achieved rates and occupancies. Given the current economic climate, few would envy him his task. Yet he remains philosophical. He says: "The 11th of September was a major setback. We lost out heavily on the leisure side, because we had contracted three US tour operators and this business just died. Since then, we've widened the net and, anyway, the US business is picking up again. American Airlines Vacations is one of our partners."

Air crews from Alitalia, the Italian national carrier, stay at the hotel, and Wirtenberger is signing another contract with an unnamed major airline. However, it will not be Spanish carrier Iberia.

Wirtenberger thinks that the unique selling point of a Sol Meliá hotel is the family ethos, which has survived its growth, and that the corresponding personal touch and high levels of service register with the guest. For now, the White House's guest mix shows that one-quarter of guests come from the USA, 20% from the UK and 16% from Spain. The average achieved double room rate (excluding VAT) is £112 on a rack tariff of £233. During 2001, occupancy hovered just above 60%. Wirtenberger wants to raise this to 72% this year.

Others share his optimism. At real estate advisory services firm Insignia Hotels, director Jonathan Worsley says: "The White House is in an extremely interesting area of London, with a lot of development going on around it, beside both Euston and King's Cross. Also, I think this hotel will probably corner a lot of the Spanish-speaking market that might otherwise stay at other international hotels."

Wirtenberger has just done a feasibility study for what would be another Meliá hotel in Manchester and has looked at two other possible properties in London, which would probably carry the Tryp brand (see below).

Further expansion of Sol Meliá is on the cards for 2002, consolidating the acquisitions made amid last year's frenetic activity into its four main brands. So if you haven't yet heard of Sol Meliá and its big plans, be warned: they could be casting their Spanish eyes over a hotel near you soon.

Sol Meliá

Edificio Sol Meliá, Gremio de Toneleros, 24, Poligono Son Castello, 07009 Palma de Majorca, Spain

Founder and chairman: Gabriel Escarrer
Hotels portfolio: 350
Average group occupancy in 2000: 72.3%
Staff: more than 33,000
Consolidated turnover, 2000: Pta148,400m (g892m, £551m) (up by 35% against 1999)

Potted history

• 1956: Founded by Gabriel Escarrer; the first hotel was in Palma de Majorca

• 1984: Acquires the 32 hotels of Spain's HOTASA chain, making it the largest hotel group in Spain

• 1987: Acquires first property outside Spain - Bali Sol, Bali

• 1996: Europe's first hotel management company to be listed on the Spanish stock exchange

• 1999: Management and ownership halves are merged

• 2000: Takeover of Tryp Hotels puts Sol Meliá in world's top 10 hotel groups, in terms of room numbers

• March 2002: Official relaunch of first UK property, the Meliá White House at Regent's Park, London

Brands

Sol Meliá‘s rebranding has been prompted by the company's takeover of Tryp Hotels in August 2000. It now has more than 350 hotels worldwide in 30 countries on four continents.

In 2001, Sol Meliá reduced its eight brands to just four.

• Meliá Hotels: Luxury hotels in major cities and select resorts worldwide. Aimed at business as well as leisure guests. Facilities often include business centres and executive floors.

• Tryp Hotels: Aimed mainly at business travellers on a limited budget, these are found mostly in European cities.

• Sol Hotels: With more than 100 of these in resorts around the world, this is the firm's holiday brand, and spans both three- and four-star standard.

• Paradisus Resorts: Created in 1995 as a luxury, all-inclusive resort brand, these offer a luxury range of leisure and sports facilities. The first opened in the Dominican Republic in 1995.