Fattal Hotel Group – Good News for Hospitality

The last couple of years have been punishing for the hospitality industry, but as Fattal Hotel Group shows, things could be finally turning around.

The Fattal Hotel Group is a group of hotels active across Europe and Israel. The Group owns and manages 200 hotels spread over 20 countries, with major activity in Germany, as well as in the UK and Ireland, Israel, and the Netherlands.

“We started out as a hotel management company 22 years ago, moving very fast in Israel to become the largest hotel group in the country,” explains the Group CEO, David Fattal. “Then we started activities in Western Europe.”

Across those 20 countries, four divisions and 200 branches, Fattal Hotels has stuck to a winning formula.

“Our unique selling point is the warmth and attitude of our team towards our guests. As a group we often say hospitality is all about love,” Fattal tells us. “The hotel guests should feel the staff love them and appreciate them coming to our hotels. There is also the design and core of our hotels. We have a special breakfast at all of our hotels. Location-wise we are very centrally located in many cities around Europe.”

That warmth is the result of a comprehensive programme of training and leadership across the company.

“Once we started our operations in Europe, especially in Germany, we felt that we needed to create a group of people who would be future managers, and so created the Leonardo Academy,” says Daniel Roger, Managing Director of Fattal Hotels in Europe and the UK. “We looked for candidates in each hotel and picked up 75 colleagues to go through a two-year planned process, working in departments they weren’t accustomed to. It has been a major success.”

An Industry-Wide Perspective

Being a company with such a wide spread of locations means that Fattal Hotel Group can offer a uniquely broad insight into the effect of the Covid pandemic on the hospitality industry for the last couple of years.

“Managing the crisis for us meant talking to and reaching agreements with hotel landlords and then talking to all of our employees. We had the trust of our employees and management, we had an online platform to manage and contact our employees, and that was very important for us,” explains Yoram Biton, Managing Director of Fattal Hotels subsidiary, Leonardo Hotels. “Additionally, we took part in a union of business hoteliers and chains to create a lobby in Germany that was active in ensuring the best interests for the industry.”

“In the UK and Ireland, we have seen a similar story. We have been utilising government support available to us in terms of business rate relief and using the furlough scheme,” agrees Jason Carruthers, Managing Director of Jurys Inns and Leonardo UK and Ireland. “Our guiding principle, as much as it was economically viable, was for hotels to remain open as much as they possibly could. We were supported by key pieces of businesses throughout the pandemic and were fortunate to have a number of hotels on the government’s quarantine programme.”

Across the Fattal Hotel Group communication with its teams was imperative. In Germany, the company devised an in-house social media solution, later rolled out across the Group to keep its teams up to speed.

“We negotiated with landlords to improve our commercial terms. Our landlords, by and large, were very supportive, as we’re a strong tenant, and in line with reducing demand we reduced our operating costs and adapted our business constantly to lower occupancies and changing regulations,” Carruthers tells us. “We also constantly work with our suppliers to understand the issues they have and the cost pressures they’re under to continue supply throughout.”

Those two qualities, communication and adaptability, would prove to be watchwords for making it through the pandemic.

Since those early days of the pandemic a lot has changed, and the second half of last year saw many restrictions lift and trade improve, but at the end of last November, the industry faced a new setback in the form of the Omicron strain.

“That knocked us back a few months,” Fattal says. “But the improvement was significant. November was a good month for us, the UK finished at 77% of our average earnings, Germany was over 60%, the Netherlands were at 60%, and Israel was at 75%. We were facing an upturn and improvement, but unfortunately, this was ruined by the new strain of Covid.”

A Time for Expansion

Yet, despite these setbacks, Fattal Hotels still has plans to open up 1,800 more rooms by 2024 across multiple sites.

“We believe in the tourism industry and the hotel industry. We think people will come back to normal life, even compensating themselves with more vacations, conventions, and business trips, so we have to be ready for them,” Fattal insists. “We’re long-term players, we’re hoteliers, we really believe the industry will flourish in the very near future.”

That said, Fattal Hotels knows that a long-term view means that recovery will not come right away.

“It will take a year-and-a-half or two years for us to get back to 2019 figures. Tourism will be strong, leisure will be stronger, but it will be a little while before we see high numbers of corporate customers, exhibitions and conventions,” says Roger. “We are working very hard on plans for sustainability in our hotels.”

Indeed, while restrictions are being lifted in many places, they are not all being lifted at the same time.

“Here in the Netherlands, we’re still in lockdown, one of the last countries in Europe to be so,” says Alexander Kluit, Managing Director of Apollo & Leonardo Hotels Benelux. “What we saw over the summer when business started getting back to normal, was enormous demand from the various segments. Q1 of this year is still very weak, but people want to travel, they want to meet. Q2 will show the first recovery.”

The Post-Covid World

Kluit predicts that the tourism sector will recover before the business sector, but he also sees ways the industry can adapt.

“What we did in Amsterdam is transform hotel rooms into working spaces,” he points out. “We also look at multi-flexible programmes for hotels where we can see different kinds of occupancies.”

While the hotel industry as a whole is likely to change, it is also true that even in the best-case scenario, customer behaviour will be different post-pandemic.

“Behaviours will change. Customers need confidence that we’re Covid compliant and hygienic moving forward,” says Carruthers. “I don’t think that will change, and we operate larger properties than our competitors, with large bedrooms and lobbies and we’re able to offer larger spaces that are naturally socially distant. So, we offer a good solution for people, and have technological advances we put in place, like taking away the need to check-in by letting people check-in online and issuing a key when they get here.”

Whatever the post-Covid world brings, the Fattal Hotel Group has spent the pandemic preparing for it.

“We used Covid not to sit down and do nothing but to invest in our hotels, refurbish, upgrade, and invest in systems and people, ready for the moment when we can invite our guests in full back to the hotels,” says Kluit.

“In the UK our five most prominent properties in the Group underwent full renovations over the lockdown period,” Carruthers agrees. “We are unique in having carried out such extensive renovations to bring new products to the market at a time when people are just returning to hotels.”

With more hotels opening even now, it is clear that Fattal Hotels believes in a bright future for the hospitality sector.

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