Profile: Cult Hotels opens the George in Cheltenham, a hotel combining small prices with big style

As someone who sees life as a world of opportunity, multimillionaire Dunkerton is clear that Cult Hotels – named after his first fashion brand – will fill a gaping hole in the market. "I'm quite good at calculating what the public want," he explains. "I don't do things just for the sake of doing them, I do them because there is a need for them."

And what the public is clamouring for, according to Dunkerton, is a beautifully styled hotel that does not blow the budget, rather than what he describes as the "aesthetically challenged and really very mediocre" hotels that currently exist for guests who don't want to spend a fortune. Bedrooms at Cult Hotels start at £90 for an Edgy room, rising to £170 for a Culture room via two further categories, Urban and Cool.

"If you think of the value hotels, they are not providing the Soho House or the Lucky Onion experience," says Dunkerton. "There is nothing like it in the market at present."

Unsurprisingly, there is much about the George hotel that provides a nod to the two brands referenced by Dunkerton, not least the nuts and bolts of a great hotel stay, namely comfortable Hypnos beds, superfast WiFi, invigorating rainfall showers and a generous selection of natural bathroom amenities from Norwegian brand Sprekenhus. "We want to be better than other low-cost hotels," he says. "What we are offering is amazing."

Little luxuries

Located across five Grade-II-listed Regency townhouses, the 46-bedroom George hotel has undergone a total refurbishment after being bought by Dunkerton from Cotswold Inns & Hotels off a guide price of £3.6m in 2018. "It was a very sad state of affairs," he says. "It was one of those classic hotels that had not had any investment."

Building on the experience and strong aesthetics created across the Lucky Onion group, Dunkerton and his fashion designer wife Jade Holland Cooper have retained the Georgian feel of the building while totally transforming the property, which opened its doors to guests in August 2020.

The quality of the refurbishment is impressive, with all the touchpoints – the 400-thread-count cotton sheets, the heavy bedroom drapes and the impressive floor-to-ceiling sash windows – more reminiscent of a luxury hotel than one with room prices starting under £100. A moody palette of deep blues and greys, brightly tiled bathrooms and a selection of Penguin paperback classics at each bedside all add to the boutique vibe.

While the look of the George and the quality of the bedroom experience is exceptional for the price point, the economics means that extraneous extras – or "the fluff", as the marketing material describes it – have been stripped out, resulting in a team of staff that numbers just 18. So, food and beverage is limited to breakfast and a 24-hour pantry, offering beer, cider, wine, pre-mixed cocktails, soft drinks, crisps and biscuits, alongside an extensive range of toiletries, to compensate for the lack of in-room mini-bars. Limitless tea and coffee is available from the Diner, where breakfast is served, while check-in is automated, featuring a drop-and-go room card.

The timing of the pandemic has unwittingly played into the hands of the hotel, with technology enabling human contact to be limited, something that is welcomed by some guests at this particular time. An app available for guests to download prior to their stay will be launching shortly, providing information on everything from details of events taking place outside the hotel to the contents of the pantry.

Dunkerton believes that in a town like Cheltenham with a strong restaurant culture, it is pointless to include a full-service restaurant within a value hotel. "I think that is one of the failings of some low-budget hotels," he says. "They put themselves next to some really bad food. We are central with access to all the town's great food offers, not least two of our own sites very close by. We've therefore focused on the bits that are often missing – a wonderful room and an affordable price point. The biggest market will be people who want a good experience while on business. But we will also appeal to tourists wanting to be centrally located."

We've therefore focused on the bits that are often missing – a wonderful room and an affordable price point

However, the hotel has teamed up with nearby Cheltenham Ladies' College to offer access to leisure amenities including its swimming pool, tennis courts and gym. All sessions have to be pre-booked.

Like all Dunkerton's other businesses, sustainability is an essential element of the ethos of Cult Hotels. "Sustainability is important to me as a human being," he says, pointing towards the purchase of electricity from the right company as being a simple and easy way of making a huge difference to the environment.

"I'm proud to say we were an early adopter of renewable energy. We use Ecotricity – what they do is spectacular. We all have an obligation to start this journey."

Dressed for success

Dunkerton describes the launch of Cult Hotels as being akin to the first fashion brand he created, Cult Clothing, which he launched in Cheltenham as the forerunner to Superdry. "Then it was a single shop in a town full of chain stores," he says. "The hotel is the same idea – it has been put together as an independent thought process in a world full of corporate chains. That is, I think, something I'm rather good at."

It is that independent vibe that Dunkerton would like to see replicated at other locations throughout the country. However, he thinks it is unlikely that he will be the one to make it happen. Taking time out from Superdry recently (see panel) provided Dunkerton and Holland Cooper the time to create the Cult Hotels concept, but now that he is back in the hot seat at the fashion brand, he says that he does not have the bandwidth to make his dream become reality.

"It is primed for someone to come into the market, sweep it up and run with it," says Dunkerton. "It is a great concept with a great future, but I'm just an incredibly busy human being at the moment – 99.9% of my time is spent on Superdry."

It is primed for someone to come into the market, sweep it up and run with it

He confirms that he is not looking to sell the brand; instead he is looking for a partner, possibly someone already in the industry or someone in private equity. "We are up and running, it works. Now I need someone to embrace it and take it forward."

Regenerating town centres

Central to any expansion plans for Cult would be securing sites in town or city centres that would be able to accommodate around 40 bedrooms, but anything between 40 and 80 bedrooms would be feasible. Increasing numbers of centrally located buildings becoming vacant as a result of the pandemic could be advantageous.

"We are talking about massive regeneration projects," says Dunkerton. "The large holes that have appeared in town centres could be filled very neatly with a project like this." He dismisses the idea that all Cult hotels should be located in a heritage building like the one in Cheltenham. "Some 1960s architecture, if treated correctly, could be quite exciting and look really funky."

Meanwhile, Dunkerton is buoyed up by the enthusiasm with which the public has embraced the revamped George hotel and returned to the properties across the Lucky Onion group since the relaxation of lockdown, driving business up by 100% since April 2021 compared to the same three-month period in 2019.

"If you create something that people want – the food is good and the experience is great – then they will come. Instagram is a wonderful thing as it allows people to communicate and hunt such places down. That is why we are packed – our customers spread the word. It is not us spending fortunes on advertising."

That is why we are packed – our customers spread the word. It is not us spending fortunes on advertising

Despite Dunkerton's optimism at how well his own hospitality businesses are performing, he is under no illusions at the damage done by Brexit policies that has resulted in a shortage of staff in the sector. An ardent anti-Brexiter – he donated £1m to the Remain campaign – he says that we are only just beginning to see the ramifications of the UK leaving the EU. "Brexit was devastating for me on a human level and on a country level."

For the long-term health of British hospitality, Dunkerton concludes our conversation with an urgent appeal to government to keep the VAT rate on the food-based aspect of business at the current reduced rate of 5% or at no more than 10%. "It will allow businesses to invest and be able to create a vibrant, restaurant-based culture, rather than seeing great restaurants being limited to large hotel environments. The economics of running a restaurant are tough and having VAT at 20% on restaurant food against supermarkets which sell food at zero-rated VAT makes no sense."

Julian Dunkerton's brands, from Superdry to Lucky Onion

Julian Dunkerton started his fashion career at the age of 19 with the launch of Cult Clothing, supported by a loan from the government's Enterprise Allowance Scheme. The company focused on vintage and American-inspired fashion and expanded from its first site in Cheltenham to towns and cities throughout the UK.

In 2003 Dunkerton joined forces with James Holder, the creator of the Bench brand, to launch Superdry, with the first store opening the following year in London's Covent Garden. The initial inspiration for the brand was Dunkerton's love of Americana combined with Holder's enthusiasm for Japanese calligraphy. A period of growth ensued, catapulted by endorsements from a celebrity clientele that included David Beckham and Idris Elba, with the business floating on the London stock exchange to the value of £395m in 2010.

Dunkerton stepped down as chief executive of Superdry in 2015 and left the company board in 2018. However, after a year that saw the company share price collapse, he was reinstated to the board and resumed his position as chief executive in 2020. Today Superdry operates in 768 locations across 65 countries worldwide. There are 245 owned stores in the UK and mainland Europe, as well as 497 franchised and licensed stores and 26 concessions.

Dunkerton's move into the hospitality sector came in 2006 when he backed the launch of Lucky Onion Group, headed up by Sam and Georgie Pearman. Following the departure of the Pearmans in 2017, Neil Fincham-Dukes was appointed chief executive, with Dunkerton as the sole director.

Lucky Onion comprises seven Gloucestershire sites, with three in Cheltenham: No 131 (flagship 36-bedroom hotel and restaurant with Gin & Juice bar), No 38 the Park (13-bedroom bed and breakfast) and the Tavern restaurant and bar; alongside the 14-bedroom Wheatsheaf Inn in Northleach, the Crown pub in Minchinhampton, the Hollow Bottom in Guiting Power and the Wild Duck in Ewen (currently closed for refurbishment). And then there is Cult Hotels' first property, the 46-bedroom George in Cheltenham, which also operates under Fincham-Dukes' remit.

Dunkerton's other business interests include Dunkerton's Organic Cider and La Boulangerie Artisan bakery.

Photography: Simon Brown