Rezidor opened four new hotels with close to 1,000 rooms, and contracted six new hotels with over 1,400 rooms, in the first quarter of 2012. The new hotels include the company's very first projects in the African countries of Guinea and Gabon.
In the first quarter, Rezidor pursued its long term development strategy - focused on profitable growth through management and franchise contracts and in emerging markets. By the end of March Rezidor operated 327 hotels and 71,600 rooms in over 50 countries across Europe, the Middle East and Africa.Following hotels opened during Q1 2012, all of them under management and franchise contracts:
- Park Inn by Radisson Rosa Khutor, Russia (pictured above) 211 rooms
- Radisson Blu Hotel Istanbul Asia, Turkey 195 rooms
- Okoume Palace Hotel Libreville, Gabon 320 rooms
- Radisson Blu Hotel Mersin, Turkey 246 rooms
Rezidor grows primarily through management and franchise contracts (while lease contracts are only considered for strategically important markets), since those agreements offer a higher profit margin and more stable income streams. These fee-based contracts also help to reduce the risk exposure and make the portfolio less volatile.The emerging markets of Eastern Europe, Africa and the Middle East are key development regions for Rezidor - about 75% of the group's contracted rooms are located in those markets. Rezidor operates dedicated, fully-fledged regional offices in Moscow, Dubai and Cape Town. Our local presence and expertise helps us reduce the risk of delays and cancellations that is higher in emerging markets than in mature markets.Rezidor's pipeline features 20,000+ managed or franchised rooms due to open within the next three to four years. It is one of the strongest pipelines in the industry, and represents ca. 30% of the current number of rooms in operation (compared with an industry average of ca. 20%). Once these rooms are operational, Rezidor's EBITDA margin will increase by 2-2.5 percentage points, supporting the EBITDA margin target of 12% over a business cycle. Rezidor's overall goal is to have 400+ hotels with 100,000 rooms in operation, and further 100+ hotels and 20,000+ rooms under development, covering a total of 75 countries by 2015.
