NEW YORK CITY—The deal that saw the investment of about $95 million by Fondo Strategico Italiano, the Italian sovereign wealth fund in Rocco Forte Hotels, was completed in March. The investment gives the fund 23% of the hotel company, which has 10 properties in Europe, with a hotel slated to open soon in Jeddah, Saudi Arabia.
Sir Rocco Forte, chairman of Rocco Forte Hotels, told Hotel News Now that while the investment would provide him with “seed money” for his planned expansion, the company remains a predominantly family-owned hotel operator.
HNN met with Forte just before a reception for travel agents, a market he sees as critically important for luxury hotels.
Hotel News Now: Does the investment by the fund have an impact on day-to-day operations?
Sir Rocco Forte: “This fund takes a long-term view of things. They have not invested just to get out in three to five years. However, if you have a partner you want to take their views into account. For example, they have a mandate to develop tourism in Italy, which is probably the prime tourist destination in the world. We have three hotels in Italy but still do not have hotels in cities like Milan and Venice, places where we want to be anyway as part of own strategy. They can be helpful to me in Italy because they have an inside track there.”
HNN: Does the fund have any other hotel partners? Is this an exclusive arrangement?
Forte: “They do not currently have other hotel partners but could partner with another hotel company if it was strategically appropriate.”
HNN: When you agreed to this deal, you said you would like to double your portfolio. Where are you in that goal?
Forte: “My ambition is not to make this the biggest hotel company. We want to find unique properties in certain cities. The building has to be special, whether it is a reuse of a building, a conversion of a hotel or a new building. I have built five hotels from the ground up.”
HNN: What cities are priorities for expansion, and how far along are you in developing them?
Forte: “I would like to be in Paris, Madrid, (New York City), Miami, Milan and Venice. I would also like to be in Palermo, Sicily; we already have a resort in Sicily (Verdura). Our projects in Milan and Venice are further along, but the others are still embryonic.”
HNN: Would you consider another brand in a category other than luxury?
Forte: “If you’re a small business, you don’t want to spend your resources, so that is not something we are considering.”
HNN: What are your top priorities now?
Forte: “First is finding the right projects. Second is finding investors for individual hotels. We are also putting a lot of effort into making sure our existing hotels are at their best. We are putting renewed emphasis on training and the ability of our staff to interact with guests in a natural way.”
HNN: What distinguishes your hotels in a crowded luxury market?
Forte: “All of our hotels are individual with their own personality. I was the one who first talked about a ‘sense of place,’ and that is what we aim for. Nobody does it that well so that when you are in most hotels you could be anywhere. What is also different about us is that we are a family business. I have two daughters who are actively involved in the business, and my son will be involved when he graduates from college. My sister is also involved. One of my daughters oversees restaurants and bars, where she has outside experience; the other is involved with training and (human resources). She has also taken on spas, where we are creating a centralized brand.”
HNN: What about food and beverage, which has become so central to travel?
Forte: “Hotels have never done well with restaurants because general managers focus on rooms where most of the revenue comes from. But restaurants need continuous attention. They must be vibrant because an empty restaurant is not appealing. The approach to food should be locally sourced, quality ingredients cooked with simplicity.”
HNN: You are here at a reception for travel agents. What’s their role now?
Forte: “Agents today have become brilliant at ensuring that their clients are treated well by getting to know the hotels and the GMs. Agents are an important part of our U.S. market, which is our largest at 27% of our guests across the portfolio. Next is the U.K. at 15%, the Middle East at 11%, Russia at 8% and then smaller amounts from other source countries.”
HNN: What are the biggest challenges for luxury hotels today?
Forte: “The luxury end is about providing guests with personalized services, but technology has changed the business a great deal as far as how we find and book hotels, how hotels are bought and sold and with the advent of online travel agencies and review sites. We have to be on top of all that because with all the changes word of mouth remains critical. Word of mouth may now be through social media or review sites, but we still have to work with that. Review sites themselves can be a sham because they can be manipulated, but we have to deal with them.”
HNN: In years to come, what do you envision for the company that bears your name?
Forte: “I will keep working because I enjoy this business. If I stopped, I would be bored stiff. I also want to see my children take over the business in time.”
HNN: Because your father (Charles Forte) founded the company, was there ever a possibility of you not being in hospitality?
Forte: “As a young man, I spent my school holidays in the business. After I graduated from Oxford, I worked in chartered accountancy for another firm for three years. But I couldn’t wait to get back to the hotel business. However, that was a very good experience because now accountants can’t tell me what to do and I understand their mumbo jumbo.”
HNN: Any other diversions from hotels?
Forte: “When I was 13, I was cast in a television play where I played a waiter in an Italian restaurant. It was in Italian, which we spoke at home and which I studied (Charles Forte was an immigrant from Italy to Scotland). Many years later I met Michael Caine, and he asked me if I’d ever been on television. I told him about that one experience. He said that he was an extra on that show while I had a speaking role. I was offered a number of parts after that, but my dad was not keen on that idea. He wanted me to go to university and work in the business. I have no regrets about that.”