#GLF19 | “In the future, our plan is to be a pure hotel company”

3 min reading time

Published on 24/05/19 - Updated on 17/03/22

Simón Pedro BARCELÓ VADELL

Simón Pedro BARCELÓ VADELL, Co-Chairman, BARCELÓ HOTELS & RESORTS shares the history and transformations of the group.

Barceló an 89-year-old family business. Let me introduce Barceló and tell you what we are. By year end, we will open our largest resort in Mexico with 3,700 rooms in the south of Cancún. We are stronger in resorts although in recent years we have been trying to grow in city hotels.
We are a hotel company and also a travel company.

Barcelo

We have a lot of brands in the travel business and most of them are well known in Spanish speaking countries.

Barcelo brands

For the hotel division, we have an activity under our own brands and a pure management hotel company in the US with Crestline. We manage more than 130 hotels in the US for Marriott, Hilton, IHG…. We used to have only one brand that targets families, but in 2015 we bought Occidental Hotel another Spanish company with a presence in the Caribbean and decided to start a multi-brand strategy for the first time. From Allegro, which is midscale, to Royal Hideaway, our luxury properties.

We have enjoyed fantastic years, all the markets where we are present have performed extremely well. Our turnover has grown, our EBITDA has grown, the only thing that is going down is our debt.
We want to be strong for the future. We closed 2018 with 350 million euros of EBITDA and almost no financial debt.
We are now ready for consolidation and to do more things in our industry. For instance, more than a year ago we made a bid to NH to merge to become the largest Spanish company by far, but they didn’t accept.

We adapt our strategy by location. In the US we are a pure hotel management company, no investments, no brands. We own almost 100% of our assets in Latin America. 3 years ago, in Europe, mostly in Spain, we sold our leisure assets to Hispania which was acquired last year by Blackstone. In Asia we are trying franchise. We just signed a couple of master franchise agreements with Chinese companies.

We are still targeting higher market shares in the countries where we are present. We are second in Spain in terms of number of rooms and we have that position with only 2% market share so the opportunity to grow in our existing market is huge and it is what we plan to do in the coming years.

The history of the company is related to leisure and to mass market movement from north to south. My family saw the opportunity in Majorca to accommodate tourists spending their holiday in Spain. We replicated that model in the Caribbean in the 80’s and 90’s. We think this will happen in Asia as well and tourists will need a nice convenient product to travel from north to south.

We will consolidate and are in a position to be a buyer, to be active. We will try to take advantage of new investors in our industry. We have good relationships with various owners and hope to strengthen these relationships. The level of return they expect is a level of return we believe we can achieve.
Hotels have always been on the market, while tour and travel companies raise more doubt. In the future, our plan is to be a pure hotel company. We have plans to divest our travel companies in Spain in the near future.
With the type of offer we have, our guests stay longer than in city hotels so we have more chances to understand them better and be ready for the future of our industry.

Barcelo Hotels

Barcelo Hotels

Hotel Group

  • Barcelo Hotels Spain
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