Accor Group has signed a hotel management agreement with Action Hotels to operate Novotel Sharq – the owner and developer’s third hotel in Kuwait.
The 160-room four-star Novotel Sharq is expected to cost approximately $29 million to build – an average of $181,000 per room, in addition to the $12.3 million paid to secure the plot of land.
Action Hotels CEO Alan Debare revealed: “Construction is scheduled to commence by mid-2015 and we expect the Novotel Sharq to open its doors to Kuwait in 2017, joining the 175-room ibis Salmiya which opened in 2008, and the neighbouring 160-room ibis Sharq, now four years in operation.”
“Our two operating hotels in Kuwait are currently achieving the highest gross operating margins within our portfolio as a direct result of the strong demand for quality economy and midscale hotels along with the economies of scale associated with commercial synergies and sharing of overheads between the two ibis hotels. With this third hotel joining the same operational cluster, we are expecting to generate further benefits,” he added.
Action Hotels chairman His Excellency Sheikh Mubarak Abdulla Mubarak Al Sabah said: “We are pleased to partner with Accor for the development of Kuwait’s first Novotel. This is a great addition to our growing portfolio of economy and mid-market hotels in the Middle East. We strongly believe that the Novotel brand is at the forefront of the mid-market hotel segment and this will help drive superior returns.”
Accor’s current portfolio comprises 3600 hotels across 14 brands in 92 countries with 170,000 employees. In the Middle East, Accor operates 66 hotels with over 16,000 rooms in ten countries.
The group recently set a target of 30,000 rooms in the Middle East by 2020, almost doubling Accor’s inventory in the region.
Action Hotels current portfolio consists of six hotels, five of which are in the Middle East, and one in Australia. The company has another nine hotels in the pipeline, all of which are expected to open by the end of 2016.
Action Hotels has set a target of having 5000 economy and midscale hotel rooms by 2020.