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By the fourth quarter of 2019, Jumeirah plans to unveil the first property of its newest lifestyle brand in Shoreditch, London, where it just recently opened a new Zabeel House by Jumeirah property.
The new upper upscale lifestyle brand, which doesn’t have an official name just yet, is being piloted under the name “District,” Jumeirah Group CEO Jose Silva told Skift on Tuesday at the International Luxury Travel Market (ILTM) conference in Cannes, France. District, however, is not the finalized or official name for the new brand.
The decision to launch District, Silva said, was driven by an acknowledgement that tourism continues to grow, and that “the secondary districts, or neighborhoods, for discovery will be the future of the travel industry.” For London, he said, that district is Shoreditch, which “the 21st century consumer wants.”
“They want engagement with the local community,” Silva explained. “That traveler doesn’t want to visit another Louis Vuitton store. It’s about having more authentic and local engagement.” The guest who will want to stay at a District, he said, is “more integrated” with the local communities that they want to explore, and “shares that lifestyle, he added.
As for specific features of this new brand, Silva said that it will feature “smaller rooms” and will offer “more digital engagement for services.” That digital engagement includes the launch of a group-wide e-butler or chat platform that will be eventually be available across all of Jumeirah’s brands, but will be piloted first at District. That system will enable guests to request services digitally, via chat functions, for example.
Dining has also become an essential part of Jumeirah’s business plan, and although District isn’t considered a luxury brand, the importance of its culinary offerings will still be heavily weighted, and designed to be both “very local, affordable, and smartly priced for the local community,” Silva noted. Silva, who became CEO this March, appointed Michael Ellis, former international director of the Michelin Guides, as Jumeirah’s chief culinary officer in June.
This initial description of District seems to draw upon a number of themes that have permeated new hotel brand launches: smaller rooms, an emphasis on dining that appeals both to locals and guests, more digital engagement with consumers, and openings in locations that aren’t considered prime — at least not yet. It’s a formula being taken by a number of brands, such as the Hoxton, or Marriott’s Moxy, or even Hoshinoya’s new Omo brand, in some regards, for example.
Pricing for this brand will also vary according to location, Silva said, but will likely cost only 30 percent of what a hotel in a primary address in a particular city might charge. So where a room in downtown London might cost anywhere from $380 to $760 a night, a night at the District in Shoreditch might only cost $130 to $190 a night, he explained. Although, as those neighborhoods grow in popularity, there’s room for rates to rise as well.
That calls into question the gentrifying effect that hotels like a District may have on local neighborhoods. To that question, Silva said, “It’s a balance. Those neighborhoods need trade. Local communities could need some tourism traffic. But the pricing here is still for the local community.”
Silva’s response about the potential for gentrification of neighborhoods was an acknowledgment of a growing sentiment expressed by a number of ILTM Cannes attendees who referred to “responsible” or “conscious” travel as a trend for luxury travel.
As Preferred Hotels CEO Lindsey Ueberroth described it to Skift, it’s the idea that sustainability is “being taken to a new level, especially in the luxury space. That it’s not just about sustainability anymore, but also about human rights, and local communities.”
Yet Another New Luxury Soft Brand Collection
In addition to launching District next year, Jumeirah will also join its peers in debuting a new soft brand collection for independent luxury hotels, named after Jumeirah’s signature Burj Al Arab property. Silva described the Burj Collection as “ultra-luxury” and said that it won’t officially launch until Jumeirah finds the founding member of the new brand.
For brands like Jumeirah and its peers, Hilton, Marriott, Hyatt, and others included, soft brand collections like the Burj Collection are convenient ways to help them attract independent hotels, and to collect fees from those properties, as well as build up credentials for having more unique, and more differentiated properties in their respective portfolios.
Most recently, this year, Hilton relaunched Blackstone’s LXR hotel brand as its newest luxury soft brand collection.
An Overview of the Jumeirah Group Portfolio
With these two new brands, Jumeirah Group will have a total of four brands by the end of 2019: signature Jumeirah (luxury), Zabeel House (lifestyle), Burj Collection (ultra luxury), and District (lifestyle).
And within five years, Silva said, he hopes the company can grow its portfolio from 15 hotels in 2018 to a total of 35 to 50 properties.
“We don’t want to be huge,” he explained. “We want to be brand elevating, rather than brand growing, and I’d rather focus on investing in the hotels we have and having a great fit for whatever ones we add.”
Unlike some of its other hotel peers, Jumeirah takes an asset heavy — as opposed to asset light — approach, preferring to own its own real estate because, as Silva said, “we want to control the brand.”
When asked if Jumeirah might consider acquiring some of Belmond’s assets or its brand, Silva wouldn’t say, but he did note, “There are a lot of people looking at Belmond. We’re interested in acquiring properties, and destinations, that elevate our brand.”