When AccorHotels finalized its purchase of Fairmont Raffles Hotels International (FRHI) for $2.7 billion in July 2016, it meant the mega-hotel company with brands such as Sofitel, Pullman, MGallery and Grand Mercure, as well as Mama Shelter, onefinestay, Novotel and Ibis, now also owned the Fairmont, Raffles and Swissôtel brands.
Acknowledging the importance of its top brands, Accor very early on formed the AccorHotels Luxe division to separate out its higher-end hotels and called upon Chris Cahill to lead it. Cahill was an obvious choice; he had joined AccorHotels’ Executive Committee when the group finalized the acquisition of FRHI. Prior, he had served for 19 years (1993-2012) in several roles at Fairmont Raffles Hotels International (FRHI) and its predecessor companies; in fact, it’s likely he knows the inherent DNA of the Fairmont brand better than most.
Luxury Travel Advisor traveled to AccorHotels’ headquarters in Paris to catch up with Cahill, to learn about his strategy for merging the FRHI brands in to the AccorHotels family.
The day before we met, AccorHotels had signed a deal with the French-owned SNCF Group to acquire a 50 percent stake in the share capital of Orient Express.
“We’ve got a partnership with SNCF, the railway company, to develop Orient Express hotels,” Cahill told us. “We think that this is going to be a great opportunity for us. We’re formulating the brand strategy right now. There are a couple of different ways we can go, but already we’ve had a lot of interest from people calling us to ask for further discussions.”
Orient Express (not to be confused with Belmond, which carried the Orient Express name until a few years ago) is a dynamic addition to a burgeoning portfolio of luxury brands that’s already in expansion mode. At the time of purchase, FRHI already had 155 properties around the world and there is an array of iconic new hotels in development.
For example, the Raffles Old War Office in London, opening in 2020, is being positioned as a “game changer” for European luxury hotels. Raffles also opens in Warsaw, Poland early this year in a historic building and will reset the luxury standard in that city.
Fairmont Hotels & Resorts has signed a contract to open a hotel in St. Lucia and is about to debut a 50-story new-build in Austin, Texas. Fairmont is also reflagging the Century Plaza Hotel in Los Angeles, which is undergoing a massive renovation and reopens this year.
Across Asia-Pacific and the Middle East there are plans for strong expansion; at press time, AccorHotels signed a management agreement for PALM360, a two-tower development on Palm Jumeirah, which will include Raffles The Palm Dubai Hotel and Raffles Residences PALM360. Set to open in 2021, PALM360 will be the first beachside resort for Raffles in Dubai.
Expect more to come: Word is that since AccorHotels and FRHI joined forces, there is strong interest from developers seeking to put Accor Luxury brands on their hotels.
As a physical force, AccorHotels has a strong presence in Paris; its headquarters sits in a 23-story building just outside the city. The spacious lobby has a high-tech décor and with 1,600 employees coming and going all day, it’s constantly abuzz.
Cahill oversees his vast portfolio of brands from one of the top floors. He is a recent transplant to Paris from North America, a move he said he is very much enjoying. But there’s no question that his new role is keeping him quite busy within the Accor complex.
It’s quite clear this executive’s past experience morphs perfectly in to his position as CEO of AccorHotels’ Luxury Brands (He is also the CEO of HotelServices North America, Central America and the Caribbean Region). He is strong in executive leadership, operations and marketing and has an in-depth knowledge and appreciation of the luxury travel advisor market.
Canadian by birth, he’s a self-proclaimed “career hotel person” and holds two Bachelor’s Degrees in Education and Political Science from the University of Ottawa, and an MBA from the University of Toronto. His nearly two decades with FRHI include leadership positions in operations and prior to that he worked in many facets of the hotel business in cities across Canada. Before joining AccorHotels last year, he served as the executive vice president of global operations for Las Vegas Sands Corp. in the United States, China and Singapore.
These days, Cahill is using all his past skills and knowledge of the industry and taking them to Paris to make big things happen.
Le Royal Monceau Raffles Paris, a “palace-status” hotel in the City of Light, underwent a full renovation led by designer Philippe Starck.
Setting Accor apart from other global hotel companies with portfolios of luxury brands is his number-one priority. For that reason, Cahill is all about ensuring that Raffles, Fairmont, Sofitel, MGallery, Pullman, Swissôtel and Grand Mercure have air-tight strategies for being uniquely identified in the marketplace.
“The structure that we’ve set up here is unique, relative to a lot of other multi-brand hotel groups,” Cahill tells Luxury Travel Advisor. “One of the challenges when you are dealing with luxury brands in a multi-brand organization is making sure that they maintain their integrity.”
Cahill walked us through the guiding principles that were put in place to support the unique identity of each brand.
First off, for each of the brands there is a dedicated brand team. “They are made up of very senior people who are the strategic drivers of the brand; they work with a community of people in the field dealing with everything from brand standards and brand performance,” he says.
Each team also works on aspects of the brand that could be altered, including service and design. They then use the larger AccorHotels organization to drive their programs through, whether that’s e-commerce, public relations or online media, says Cahill.
According to him, that is a different strategy from some of Accor Luxury’s competitors, which cluster multiple brands under one group.
“From our perspective, it’s extremely important to avoid brand bleed,” says Cahill. “We’ve seen it with other groups where a really good brand concept shifts to another sister brand, becoming a standard within that one and in the end all start to look alike within the same family. So this strategy is intended to ensure that we maintain brand integrity.”
“Talent and culture” comes next as a guiding principle for Cahill’s division. Building up talent and culture is vital, says Cahill, since in the luxury sector, a brand is really defined by its service style.
“Obviously the physical aspects of a building have to be of a certain high quality, but in terms of brand identity it comes down to people, and the people delivering the service,” he says.
Again, for the fundamentals, such as processing applications, Cahill’s division relies on the larger AccorHotels organization.
After that, however, the elements of each brand are carried into the hiring process, the training process and the orientation process to develop new talent, as well as leadership within the organization.
Cahill says that he signs off on key hires for general managers, especially for those that are critical, “that are really going to matter from a brand perspective.”
The third principle? Those involved in the luxury and upper upscale brands deal only in that arena and do not extend themselves in to other brand tiers, like midscale and economy.
This unique model also includes dedicated sales professionals as well as exclusive luxury operations teams.
“These specific strategies we put in place will help maintain the integrity of each brand and support the vision that we have, and that is to be a leader in the luxury space without diminishing the strong presence we have in all the other segments globally,” he says.
How do the brands fall within the portfolio? Raffles, Fairmont and Sofitel are “luxury.” As it’s developed, the new Orient Express brand will likely sit between Raffles and Fairmont. The “upper upscale” brands are Pullman, MGallery, Swissôtel and Grand Mercure.
Here is how Cahill sees them playing out in the portfolio.
“Raffles is a super luxury brand; its identity is that of residential feel,” says Cahill. “It has a rarefied air in the sense there’s only ever going to be so many of them on the global stage because there are only so many places you can actually put a Raffles and be successful.”
Fairmonts, he says, tend to be “grand hotels,” for the most part. “Even if the building itself is new or modern, they tend to have big lobby spaces and a lot of meeting space. They are a place of occasion for people, and the style of service is very engaging,” says Cahill. “It’s a fundamental warmth, and that’s all built in the hiring and training process that has been built up over 25 years.”
Sofitel, he says, has a joie de vivre and a modern French styling about it. “We try to take the best that we can in terms of what people’s perception is about France and build it into that brand. I think that has been done really well in terms of brand positioning. It’s very clear and very different. Sofitels tend to be more sophisticated and stylish.”
MGallery hotels are typically boutique properties that have been refurbished or redeveloped, at times in mixed-use developments. “They’re all unique,” Cahill says. “It’s a fun and very feminine brand that has been around less than 10 years and already counts close to 100 hotels. It’ll continue to grow as it is a great brand in that space; singular, boutique, unique and inspiring.”
The Pullman brand pulls on the heritage of its name (think railroad cars, luggage and the lure of travel in general.) “It’s very much for the road warrior, the traveler. Even in resorts it tends to be a pretty broad catch space for global travelers, or nomads, as we refer to them. I think the important unique, distinct aspect of it is this whole link to the history of travel and trying to modernize that. That means it’s very technology-driven and hotels tend to have high-speed Wi-Fi,” he says.
As for the upper upscale brands, Swissôtel, is about the image of Switzerland. “The efficiency, clean lines in terms of design, the hospitality of Switzerland; the DNA is an easy one to work with,” Cahill notes.
Grand Mercure has been developed primarily in Asia and somewhat in the Middle East, says Cahill. “It’s now spreading, but hotels grew pretty quickly in that part of the world and we’re already at about 40 properties. That one will continue to move; it tends to reflect its local community...So it fits really well with wherever you put it because it’s going to be all about that community, whether it’s food or design.”
(Note: AccorHotels also owns onefinestay, the home rental company. While that doesn’t fall under Cahill’s purview, his group does support it with its luxury sales team.)
Carefully defining each brand sets it firmly in the consumer’s and luxury travel advisor’s minds; it also makes it easy to speak to developers or prospective hotel owners about which brands will work for their future projects. “It’s not hard to figure out which brand should fit which asset,” he says.
The Fairmont St. Lucia at Sunset Bay is scheduled to open in late 2019.
The AccorHotels and FRHI transaction closed July 12, 2016; the “people” aspect of the integration went smoothly because both companies have very respectful cultures, says Cahill. In fact, an internal survey showed just months later, in the fall, that FRHI employees felt as engaged and committed to their company than ever. Key metrics that measure the health of a hotel and the brands, such as service scores and RevPAR, moved up as well.
“The professionalism with which both groups were working together was pretty obvious,” says Cahill. “That was a credit to both organizations at a corporate level. The thoughtfulness, the respect and the openness with which both teams approached the integration allowed people to feel good about the future.”
Cahill says he is quite pleased with the growth the brands have seen since AccorHotels and FRHI came together.
“Since the transaction we’ve signed 30 to 35 properties in the Fairmont, Raffles and Swissôtel brands, to say nothing of all of our other brands, which is a tremendous number of new opportunities for us. We have a lot on the development side, properties that are opening and opened,” he notes.
Some of these are new builds, others are conversions of existing properties. “We’re seeing great acceptance and great reception from the development community. A lot of that growth is in Asia-Pacific, Middle East and somewhat in Europe,” Cahill adds.
North America is not seeing a lot of luxury growth happening at the moment, he notes; rather, growth here is more in the mid-scale and economy sectors.
That makes the deal for a Fairmont in St. Lucia and the reflag of the Century City Plaza Hotel in Los Angeles all the more significant.
Cahill is especially excited about the Raffles Old War Office in London, whose opening is three years away, as the property in Whitehall is undergoing an enormous redevelopment.
“It’s where Churchill had his war office, and this building is massive,” says Cahill. “There’s going to be a residential development and the hotel, and it’s going to be a phenomenal property.”
The redevelopment of Raffles Singapore, which first opened in 1887, is also a significant project for AccorHotels. Most of the hotel is currently closed; a grand reopening is planned for the second half of 2018.
This is a true restoration project, says Cahill.
“Because of the historic nature of the property and its significance in Singapore and its protected status, you can’t touch a wall,” he says. As a result, new tile will feel very much like the tile that has always been there; chandeliers will be new but not starkly different from what was there in the past. The Long Bar where the Singapore Sling was invented will be there again when the hotel reopens. It will just be newer.
“I think it’s going to be a phenomenal hotel because people will feel like it’s been there forever,” says Cahill.
The repositioning of major icons in North America has also been underway. Significant projects include a $60 million restoration of the iconic Fairmont Empress in Victoria, British Columbia, which was completed this year. Fairmont The Queen Elizabeth in Montreal also reopened after $140 million renovation and The Fairmont Royal York in Toronto is in the midst of a massive five-year renovation.
In the works is the conversion of the Sofitel Rio de Janeiro Copacabana; it will become a Fairmont. The property had already been designated for a renovation that would close the hotel. AccorHotels has another Sofitel in Rio and realized the hotel has several components that speak to the Fairmont brand; it’s a large hotel, has an abundance of meeting space and several swimming pools. The conversion from Sofitel to Fairmont includes adding in Fairmont Gold amenities and giving guestrooms a Fairmont look.
Fairmont Chateau Lake Louise is one of the brand’s original iconic grande dame hotels.
A Day in the Life
Cahill doesn’t have a typical day by any means. As a manager, 30 percent of his time is spent on “people issues in one way, shape or form,” he says, and of course, he’s traveling frequently to meet with hotel owners, either for new developments or to check in on existing assets. “The travel part is probably where I spend half my time. This is where I get a chance to engage with the hotel teams and the business and really understand what they’re doing and what’s going on.”
Toronto, Fairmont’s former headquarters, now serves as AccorHotels’ North American corporate office and because Cahill also serves as the CEO of North America, he is back in the continent six to eight times a year.
Now a transplant to Paris, he is enjoying the city’s lifestyle. Before, he had spent time in the city in one- to two-day increments when FRHI was building the Raffles Royal Monceau, but never on a full-time basis.
“The thing I love about it is that within your community, you literally can walk out and get everything you want. You can shop and everything is open later. You can leave work at 8:00 at night and go pick up what you want for dinner. It’s very easy living. It’s a great walking city. Even getting around by subway system is fantastic because it just goes everywhere,” he tells Luxury Travel Advisor.
Cahill has been in the hotel business since college; he had formal training, moving through food and beverage, rooms, sales and marketing, working for companies that required management, operations and development expertise. He says there’s no one part of the hotel industry he prefers.
“To me, it’s all one business and it’s just such a great business,” he says.
He encourages those entering hotel life to learn it all, saying, “The best thing you can do is work in the kitchen for eight months to a year because that’s the heart of what happens. Then spend a little time in housekeeping. After that you can go be an investment banker in the hotel business but least you’ll understand it.”
As Cahill moves AccorHotels’ luxury and upper upscale brands in to the future, he’ll be doing it in an industry he’s passionate about because by nature, it’s one that craves talent and provides a clear career path.
“You’re always going to need good people, and so if you want to work and you’ve got the ambition and the passion, you’ll always have an opportunity,” says Cahill.
A Most Important Market
Luxury travel advisors are very much a part of AccorHotels’ future; there’s an entire group dedicated to working with the segment.
That group is headed up by Pascal Visintainer, who told us that there are three senior luxury sales directors in the U.S. market, two covering the west coast and one for the east coast, overseeing Raffles, Fairmont, Sofitel, onefinestay and MGallery.
“As leaders in the industry, they bring not only knowledge but also invaluable relationships for the brands, managing our connections with the luxury travel agencies and the luxury consortia,” says Visintainer. Plans are to add one more person dedicated to training luxury agencies on AccorHotels Luxe properties.
“The more travel advisors know our properties, the more confident they will be with our products,” says Visintainer, adding that the team is attending most of the luxury consortia events around the country; it’s also organizing dedicated sales missions for the hotels.
“AccorHotels has always considered the luxury travel advisor as a critical part of our distribution. We definitely prioritize the development of these partnerships as they provide important business to our hotels,” he notes.
As for consumers, “the U.S. remains the largest feeder market for luxury travel,” says Rick Harvey Lam, senior vice president of global brand marketing. “So we will continue promoting our core luxury brands in this very important market. Whether it’s for the Fairmont or Sofitel brands, the media mix includes on- and offline [print] media. The creative platforms for both brands are under review and we are in the process of determining whether they still reflect the brand essence effectively. Sofitel’s advertising campaign should evolve by year’s end (2017).”
Chairman and CEO: Sébastien Bazin
CEO Luxury Brands, CEO Hotel Services North America, Central America and Caribbean Region: Chris Cahill
Senior Vice President Global Brand Marketing: Rick Harvey Lam
VP Luxury Sales: Pascal Visintainer
Director, Luxury Sales, North America: Leslie Dodson
Luxury and Upper Upscale Brands: Raffles, Orient Express, Fairmont, Sofitel Legend, SO Sofitel, Sofitel, Swissôtel, MGallery, Grand Mercure, Pullman
Raffles: 11 hotels
Fairmont: 75 hotels
Sofitel: 122 hotels (this includes five Legend and four SO)
MGallery: 90 hotels
Swissôtel: 30 hotels
Grand Mercure: 44 hotels
Pullman: 117 hotels