Boutique hotels have created a buoyant market, conference hears
Boutique properties are a great way to establish exciting hotels within difficult and unusual buildings, the inaugural Boutique Hotel Summit 2011 was told.
Speaking to an audience of operators and investors at the newly opened St Ermin's hotel in London, HVS London director Tim Smith highlighted two properties that had recently launched themselves as successful boutique hotels.
"At the Town Hall hotel in Bethnal Green, Singapore-based hotelier Peng Loh has created something so exciting in terms of design, the restaurant and level of service that it has become a destination in its own right," Smith said.
"Hotel Indigo near Paddington was previously an unbranded hotel that many operators tried and failed to convert successfully. But the boutique concept has lent itself to the building's various-sized rooms and split-levels.
"The hotel is now something extraordinary and is trading at a good average room rate. You would never know it is part of InterContinental."
Smith went on to say that the level of new entrants and investors coming into the sector shows the buoyancy of the market.
"It's a real shot in the arm for an industry that has had issues to overcome," he said. "These hotels represent serious investments."
Significant and recent purchases include 10 Trinity Square, which is to be operated by Franklyn Hotels and cost KOP Properties around £70m (£700,000 per room), while the St Ermin's, nearing the end of a £30m refurbishment, cost a consortium led by Amerimar Enterprises £60m.
Smith concluded that the hotel market had polarised into one of large, corporate hotel and those offering something interesting and different.
"Consumers are going back to demanding the level of service that the previous generation expected," he said. "We are moving back into an era of wanting quality service and the wow factor - and boutique hotels have that."
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By Janet Harmer
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