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Grant Hearn reveals plans to reinvigorate Hotel Collection

24 November 2014 by
Grant Hearn reveals plans to reinvigorate Hotel Collection

Hotel Collection chairman Grant Hearn has revealed his plans to reinvigorate the four-star portfolio, following a flurry of hotel sales.

Hearn said the company will invest up to £40m in renovating the group. And he added that he is on the hunt for new properties.

"We are looking to grow, particularly in the South East, Yorkshire, Cambridge, the Lake District and Bath," said Hearn.

The announcement comes only a week after the group put its fourth hotel on the market in a month. the 122-bedroom Palace hotel in Buxton, Derbyshire, is on sale for a price in excess of £7m; the 100-bedroom Basingstoke Country hotel, near Hook, Hampshire ,£5.5m; the 152-bedroom Cheltenham Park hotel in Gloucestershire, £8m; and the 89-bedroom Marine hotel overlooking the Royal Troon golf course in Ayrshire,£7m.

Hearn said one reason for the hotel disposals was to simplify the ambitious renovation project, which will start in the new year. At least one more hotel sale is expected, streamlining the portfolio down to 15 hotels.

"Upgrading even 15 hotels will take a lot of planning. We will focus on those core properties and buy some more to keep the group going," he said.

He added that the five hotels didn't fit the criteria for core properties, which is to have in excess of 80 rooms and be four-star. He cited existing core properties as: Shrigley Hall, Macclesfield, Cheshire; Redworth Hall, Redworth, County Durham; Lygon Arms in Broadway, the Cotswolds; Imperial Torquay; and Imperial Blackpool.

The refurbishment programme will maintain the individuality of each property, with the first projects slated to be Hinckley Island hotel in Leicestershire and the Carlton in Edinburgh.

"The Carlton is a landmark hotel in an incredible location. It's very important to us, so mad not to reflect its history and locality - we are looking to spend a lot of money on that," said Hearn.

Hotel Collection has experienced difficulties in the past two-and-a-half years, partly because hotel operator Barcelo pulled out of a 45-year lease in April 2012. In June, the group was rebranded from Puma hotels. At the same time, it was announced that its £323m debt had been acquired by Lone Star Funds from the Irish Bank Resolution Corporation. In August, parent company the UK Group of Hotels was placed in administration.

Commenting on these challenges, Hearn said the business was now on the "front foot".

"It is in great shape and profitable. It's clearly not making as much revenue as the quality of the portfolio, because it needs investment," said Hearn. "But, it's in a safe place. Lone Star are fantastic owners and understand the need to invest to put the company on its own two feet."

He said his focus now is to get everything in place for investment, including the introduction of a revenue management system. And he predicted there will be a lot of activity over the next 12 months.

Hearn was appointed chairman in September. As well as 20 years' experience in full-service hotels, he brings expertise from his more recent stint as chief executive of budget sector giant Travelodge.

"Budget tries to understand what the customer wants and looks to provide it at a cost they can afford. In full-service, there is too much supposition that we know what the customer wants," said Hearn.

He added that budget hotels will drill down to details and look to fix them, such as noise, electrical socket locations, dust traps and even whether there is enough space on a bathroom shelf for his and her wash bags.

"It's that kind of detail I am bringing. I want to get budget hotel efficiency, but four-star hospitality," said Hearn.

Marine hotel overlooking Royal Troon is on market for £7m >>

Grant Hearn to lead Hotel Collection as CEO exits >>

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