Saddled with boom-era hotel debt in a glutted market, Ulster Bank is making the best of it by setting up its own hotel chain – and planning to make it the biggest in the Irish hospitality business.
A close to €600,000 investment is mooted, with funds coming from both parties in a joint venture between former Hilton boss Sir David Michels’ company, Michels and Taylor, and Ulster’s parent, Royal Bank of Scotland.
The new chain hasn’t been named yet, Michels and Taylor chief executive Hugh Taylor told the Sunday Independent, but the working title for now is The Collection.
An Irish-based office with a chief executive and a small team will apparently be set up shortly.
A Dublin-based branding agency has been hired to develop the operation’s corporate identity.
Existing hotel owners and operators will remain in place while the Ulster and Michels and Taylor team-up provides them with an umbrella business with a centralised reservations and procurement system and marketing supports.
At early stage the chain will be made up of 25-30 hotels that are effectively controlled by Ulster Bank through its lending.
“In a few weeks, we will have the first tranche of hotels in the business,” said Taylor.
“We are working on presenting the business plan and opportunity to all those hotels,” said Taylor. “We’ve had great feedback.”
Taylor says it isn’t confirmed which hotels will be part of the group.
Hotels where Ulster Bank is a creditor include the former Jurys and Burlington in Ballsbridge, Dublin, as well as a range of others across the country.
“This will be the largest hotel collection in Ireland,” said Taylor. “We have put in sufficient working capital in to support the business to successfully launch the brand.
“The marketing will be substantial and powerful, creating a brand new hotel brand in the eyes of consumers.”
He expects the business to be up and running for the first half of next year.
It would later seek to extend the chain to hotels outside Ulster Bank client hotels.
“The aim is to establish very quickly the largest branded collection of hotels in Ireland. We’re extremely excited about the scale of the venture.”
Ulster Bank has sizeable exposure to the hotel market through sometimes-disastrous Tiger-era lending to hostelries countrywide. Many will prove difficult to offload for now as Lloyds and others seek disposal of their own distressed hotel interests.
A well-known figure in Britain, Sir David Michels is chairman of investor London & Capital and is a former deputy chairman of Marks & Spencer and EasyJet. Source: The Irish Independent.