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Virgin Group to Launch Virgin HotelsSeptember 22, 2010 By: Kirk Cassels
At the 2010 Lodging Conference, Virgin Group announced that it is launching Virgin Hotels, a new four-star lifestyle hotel brand, with intentions of developing and operating up to 25 hotels within seven years. The first property is expected to open in a major gateway city in North America within 18 months. This is breaking news for the industry, even though some consumers thought Virgin Hotels have been around this whole time.
"We had a focus group that thought we had hotels, so we asked them what they were like," Anthony Marino, managing partner and executive director of Virgin Hotels told Travel Agent. Although Marino wouldn't share, just yet, what this focus group thought of Virgin Hotels, he did say that Virgin Group has been looking to enter the hotel industry for years. "We considered three things over the the last 18 months before making the announcement," he said. "The brand reached critical mass in major cities; we have an unique opportunity in real estate; and we were not getting in the business unless we do something different."
Marino also told us that the hotels will feature core attributes of the Virgin Group brand while focusing on "highly-localized" touches.
Virgin Group teamed with entrepreneur Alberto Beeck as well as hospitality and real estate investor Diego Lowenstein (both will serve on the company's board of directors) to establish a property venture that will acquire $500 million of Virgin-branded hotel assets in the next three years. Raul Leal, a career hotelier with 25 years of experience in upscale hotel operations, development and design, will serve as president and COO. Hotel real estate veteran Paul W. Whetsell, president and CEO of Capstar Hotel Company, will advise Virgin Hotels on operations and acquisitions in addition to serving on the board of directors.
The first Virgin Hotels will have 150 to 400 guest rooms, restaurants, and communal public spaces. Although the initial plan is to launch in North America, there are plans (though not immediately) to expand globally. “We are already in contact with brokers, owners, lenders and others active in hotel real estate,” Marino noted, adding that the brand will launch mostly through the conversion of properties.
Until the opening of the very first property nears, there aren't a lot of public details as to what will set Virgin Hotels apart from its competition. But both Marino and Raul Leal emphasized that service and the customer's needs will indeed be a primary focus.
"We think customers' needs have changed," Marino said. "We don't want to grow at all costs, we want to grow right. We never want to try to time the market, we want the consumers to tell us what to do."
"Service is still the ultimate luxury, and service will be the underlying theme for the brand," Leal added.
"We also intend to bridge the gap between all generations, from those in their 50s that prefer Virgin Atlantic's Upper Class service to those in their 20s that are using Virgin Mobile to text their friends."