FRHI Hotels and Resorts – the parent company of Fairmont, Raffles and Swissôtel – is strategically prepared for ambitious international growth of more than 50 per cent over the next five years. I asked Jennifer Fox, President International and President of the Fairmont Brand, to talk about the group’s plans.
While she has been with FRHI for less than three years, Jennifer’s experience within hospitality spans across 25 years. Initially appointed as the President for the Fairmont brand in November 2011, Jennifer assumed the role of President International at FRHI in September 2013, while also maintaining her previous position within Fairmont.
As one of the few senior female leaders in the global hospitality world, her career progression has been closely watched and she is recognised for her hands-on approach to leadership. Her first couple of months with Fairmont were spent travelling to the brand’s properties to personally meet their executive teams and colleagues.
Prior to joining FRHI Jennifer held senior positions in the InterContinental Hotel Group (IHG), rising to become Chief Operating Officer for Europe. She also served as Senior Vice President for Global Brand Management for IHG, where she focused on skills crucial to her eventual placement into senior leadership within FRHI, namely luxury branding strategy and international expansion.
“When I was appointed, Michael Glennie, FRHI’s COO, looked at where the group’s growth was and how the organisation was structured to support our growth. We soon realised that we were highly centralised around our brands: Fairmont was headquartered in Toronto, Raffles was headquartered in Singapore and Swissôtel’s head operations were based in Zurich. Solely looking at Fairmont, 90 per cent of our hotels in development are outside of the Americas, so the structure wasn’t working.
“Our focus was then to transition FRHI from a brand model to a geographical business model. We divided our group into regions so that we have a senior operator in Asia-Pacific, one for the Middle East, Africa and India, another for Europe and finally one for the Americas.
“This reorganisation carried immediate benefits. The senior operators we brought into those roles have a real depth of experience in each of the regions, indigenous language skills and strong connections to the community. This means that business decisions can be made quickly because they are backed by people with local knowledge and experience. Decision making is held closer to the ground, meaning that as an organisation we can react swiftly.”
Following the restructure of the group, Jennifer spoke of FRHI’s overarching strategy. “Our strategy is that we are predominantly a hotel management company. This isn’t to say that this is our preferred option – all our operations have to fit into FRHI’s scope as a leading luxury hotel group. We are fortunate enough to own some iconic hotels around the world – for instance we just bought the Claremont Hotel and Resort in Berkeley, California, with our partner Richard C. Blum and his family. In the right market and to enhance our strategic assets we will invest our own capital. FRHI is also willing to take equity in projects as long as it follows certain criteria that we set for the company. The group isn’t averse to risk – some of our hotels are being developed in places that haven’t even hit the radar for larger hotel groups – FRHI is poised to seize the right opportunities as they become available to them.”
Currently standing at more than 110 hotels, 90 per cent of the privately owned company’s new properties are being built in the Middle East and Asia making FRHI a group to watch in emerging markets. Jennifer’s confidence in the group’s rapid expansion plans is evident as she discusses the locations Fairmont, Raffles and Swissôtel have in the pipeline.
“All of our brands are on very aggressive growth plans – by 2020, we expect to have grown by 50 per cent, which for a privately owned luxury group operating at our level is quite ambitious. We are very well respected as a company, which has aided us in our success in finding the right partners in the countries where we have planned a development.”
“The key to our success has been to combine three factors each time a decision is to be made: the location, the brand and the partner all have to be chosen wisely in order for us to continue a project. Each brand has a distinct DNA that enables us to choose which of our brands to put forward for specific opportunities. Our aims are to have real presence in emerging markets, true global cities and key resort destinations, which is why you will find that 90 per cent of our growth is outside of the Americas. For us to consider adding a property in more established markets, such as Europe or North America, the opportunities we will consider would usually be a landmark or iconic property.”
“Fairmont is our largest and most recognised brand, currently standing at 67 hotels and 11 residential developments across the world. We will be increasing this number to 110 over the next five to six years. Looking at the hotels that we currently have in our pipeline, our main focus for Fairmont is within global cities with corporate centres. Take London, for instance, where we manage the Savoy – this is a city where a Fairmont-owned property could fit as well as one of our other brands. Once again, it comes down to finding the right opportunity.”
“Within Fairmont we are rapidly expanding in the Middle East and Asia, with locations including Chengdu, Fuijairah, Jakarta, Riyadh and Taiyuan.”
“Raffles and Swissôtel are also being taken in exciting directions. I would define Raffles as our uber-luxury brand, which is why our plan to double the number of properties from 11 to more than 20 in the next five years is tremendous. We see a lot of this activity happening in south-east Asia because of the focus on key resort destinations.”
“Swissôtel has 28 hotels, with the plan to go up to 45 properties over the same timeline as Fairmont and Raffles. We have a broader reach with Swissôtel and can take it into secondary markets as well as other resort destinations.”
How does the group distinguish itself from other larger luxury hotel companies?
“FRHI is a brand-led company, which enables us to have multiple developments of different brands in key cities. One of our strong differentials is our expertise with residential developments within hotels. Fairmont is a clear leader in this category when years ago the group realised the enormous potential and began strengthening our presence in this sector. I wouldn’t hesitate to say that this knowledge is what makes certain partners seek us out in emerging markets; owners select us for our experience within residences and our proven success.”
“We took the residential model and developed it for each of our brands. The popularity behind this product is evident – one can take Istanbul as an example, where Swissôtel is already present with a residential Swissôtel Living attached to it, and over the next couple of years we will launch a Fairmont and Raffles, both with residences, in the same city. A large number of our new developments, particularly in China, have residential properties – I believe it’s the future. At the same time, as a group we will never build a property in a location where the hotel can’t stand on its own and is reliant on the residential part to be successful.”
Much of Jennifer’s discussion on FRHI circles around the plans for 2020. Based on moves from her previous companies, Jennifer enters senior leadership roles where there is room to lead the brand into the future. Her first spell with a large hotel group was at Starwood for 13 years before going to IHG and spending 10 years there. The loyalty and group values that she embodies through each of her posts within FRHI are tangible throughout our discussion. Considering that the end of 2016 will be Jennifer’s fifth year with Fairmont, I ask what legacy she would like to have achieved by then.
“The group’s larger aspirations are to grow our portfolio for our shareholders and in turn for our customers – we want to make sure that we are in locations that our guests are visiting and will visit in the future. FRHI wants to fill the gaps in the distribution of hotels.”
“Personally, the objective that I’ve focused in on during the past year is placing the right senior executives across our regions. I think our current management team is perfectly placed to take the group forward. Within the Fairmont brand, the level of personalisation that our hotel brands offer guests has come leaps and bounds into where I think the future of the luxury guests’ expectations are going.”
The past few years have been challenging for hospitality, which is what makes FRHI’s business performance all the more remarkable. With a strong management team behind the group’s aggressive expansion plans, it is clear that FRHI will be one to watch.
About the author
Nicole Thompson writes for eHotelier’s sister print title EP Business in Hospitality.
