We see recovery in average rates by 2022-end: IHG's Haitham Mattar

Haitham Mattar, InterContinental Hotels Group's (IHG's) managing director for India, West Asia, and Africa talks about the state of the hospitality sector in India and the learnings over past 2 years

Haitham Mattar, InterContinental Hotels Group’s (IHG’s) managing director for India, West Asia, and Africa speaks to Pavan Lall about the state of the hospitality sector in India and the learnings over the past two years. Edited excerpts:

How has the group’s India performance been in the past few years?

The past few years have been particularly difficult across sectors. The pandemic struck us hard and incapacitated our ability to perform, especially in India and in countries where markets were closed.

What are the lessons, learnings, and possibly reflections for the company?

We are a lot more agile in the way we perform. We are more focused on owner returns. We are very conscious of operating in profitability. We focused on the team — its training, development, retention, and traction. Those have some of the great learnings from the pandemic for IHG Group. We have also seen consumer trends change, especially in the way they buy or the way they stay.

We launched the IHG Clean Promise. Guests are reassured that good isn’t good enough. That means clean, well-maintained, clutter-free rooms that meet our standards. We realised guests are much more conscious of health and safety and we have to enhance those measures across our portfolio. Guests want a frictionless, touchless journey when they check in. This has accelerated our digital progress.

Is that here to stay?

This is the future. A lot of these were already in place. Covid-19 simply quickened the progress.

When do you see meetings, incentives, conferences, and exhibitions and foreign tourism, corporate travel, and regular tourism from foreign markets picking up?

In some markets like the US and the United Arab Emirates, working life has returned to near normal.

Starting slowly with small focused meeting groups, we are seeing medium to large in-person conferences across different parts of the world where recovery has started to show. In West Asia, Dubai, and Saudi Arabia for example, with conferences and events the government has been putting together, Dubai Expo welcomed over 2 million visitors in a span of six months. The appetite for meeting spaces is coming back. At our hotels in Delhi-National Capital Region — Crowne Plaza in Gurugram, for instance, where I had stayed — most of the meeting rooms were taken up by small to medium-sized conferences.

What about your overall expansion strategy and plans for new management contracts and new hotels in India — and where?

In India, we manage franchises of around 44 hotels. We have another 40-plus hotels in the pipeline that have been signed on and are either at the design stage or under construction. We will be doubling our portfolio in the next three to five years. We are looking to introduce our luxury brands, especially Regent, Kimpton, the new Vignette, as well as Voco, for corporate conversions. The key focus is still Delhi, Bengaluru, and Mumbai, but we have recently opened a Six Senses in Rajasthan. We have hotels coming up in Gurugram, Goa, Bengaluru, and Chennai.

Is there a certain segment in hospitality that has weathered the storm better than most?

Our mainstream brands have. They have managed cost and employee base a lot better than our luxury brands. Our Holiday Inn, Holiday Inn Express are our core brands and are attractive to investors and affordable to guests.

Where are the room rates for your group? Do you see them going back to pre-Covid levels (if they haven’t already)?

Room rates are still 15 per cent behind 2019 rates. We are starting to see demand growing in the future. The forecast on average rates across the country are improving steadily. In the next three to four months, we see recovery in average rates by the end of 2022.

How has the hospitality sector in India performed vis-à-vis the West, Asia, Latin America, and West Asia?

India has proven to be very resilient and has recovered fairly quickly. Domestic travel has been the strongest, especially during the pandemic, when India’s inter-regional borders opened and restrictions eased. The concept of staycations, workcations, and weekend getaways to drive-to destinations continues to remain popular among travellers, showing fantastic recovery towards the first quarter of the year. January through March has been great. April looks good despite being the month of Ramadan.