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Meininger Hotels, the tip of the Cox & Kings iceberg

Controled by an Indian family, Cox & Kings is now an Indian tourism group with a diversification strategy that places young clientèle at the center of its business model. Peter Kerkar, representing the family's new generation, established in London, launches its initiatives in several directions, including a concept that will make its appearance in France: Meininger Hotels.

Cox & Kings is undoubtedly the oldest British travel agent, created in 1758 to provide the logistics for several  royal regiments. One after the other and through diversifications and restructuring, it landed in the portfolio of an English bank in 1930, Grindlay Bank for Development India, and then to the Kerkar, family in 1970. Ajit Kerkar was the man behind the development of the chain Taj Hotels within the group Tata, meaning he is familiar with the world of tourism and the hotel industry in particular. His son, Peter took over operations for the group Cox & Kings in 2008 and decided to redirect his entire strategy to avoid being dominated by the increase in OTAs.

"We decided to turn toward niche markets, which are too difficult for OTAs to manage, and which we can give a real added value," he explained in an exclusive interview during a visit to Paris. While preserving much of the historic activity of Cox & Kings, outgoing and incoming travel agency in India, Australia, the United Kingdom and North America, it drove a new orientation on the youth travel market: linguistic holidays, educational excursions, adventures, accommodations… It multiplies acquisitions with a few pillars, Holidaybreak Plc, owner of PGL, the British adolescent travel specialist (7 à 17 ans), also an owner of Meininger Hotels, pioneer of the new generation youth hostels in Germany.

Today, Peter Kerkar wishes to be no less than the global leader in youth accommodations for ages 7 to 27, or more if it works well thanks to these two spearheads, PGL and Meininger. The two companies have already gone abroad and are set to conquer new markets. PGL has some 7,500 beds in 15 reception centers in the United Kingdom, this modern version of Summer Camps operates year round with 60 sports and educational activities. France also has some 1,500 beds in 6 reception centers, Spain 200 and Australia 600. With no real rival in the world, faced with a market that has been exploded and essentiellement involved associations, Peter Kerkar wished to become a speaker in front of Boards of Education and academies so that it may comfortably and safely host any group of young people seeking extracurricular activities.

Meininger Hotels, meanwhile, already has 2,100 rooms and 7,000 beds in 16 hybrid properties, between youth hostels and business hotels. Nine properties in Germany and the rest in Amsterdam, Brussels, London, Salzbourg and Vienna, … and soon Paris. An agreement was signed with Foncière des Murs to guarantee development in France and in Europe. An initial call to tender was won by the tandem for a plot of land in the City of Paris at Porte de Vincennes to open a new 200-room property 200 by 2018. The eventuality of a real estate transaction for the conversion of an office building or a factory into a hotel could accellerate the process.

The Meininger concept is struggling to fit into the usual classifications of hotels. It includes individual rooms and dormitory rooms with up to eight beds, with light meals and large public areas, to host other types of complementary clientèle: school groups and students (50% fo the business), families on holiday, groups of friends and businessmen (20% of clients at certain destinations, during trade fairs). Each hotel is developing its own personality in function of the building and locations. The flexibility of the concept aims to exploit each square meter to generate a better return on investment.

Exclusively an operator, Meininger Hotels offers a promising forecast for 2015: 65 million euros turnover for 7,000 beds, occupied more than 71% of the year. The quest for new locations is speeding up under the guidance of Naveet Bali, CEO, who signed future one after the other in Munich, Hamburg, Barcelona, Rome and soon in Venice and Portugal. To speak only of Europe, twenty or so Meininger Hotels are already in the pipeline, before a programmed exportation of the concept to India. According to the CEO, major European cities can absorb between 5 and 7 properties, which will soon be the case in Berlin. He will explain his strategy at the next Global Lodging Forum on April 14 at the Bristol Hotel in Paris.



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