Nikki Beach Resorts: The Experiential Luxury Concept
By Alexander Schneider Vice President , Nikki Beach Hotels & Resorts | April 29, 2018
Over the past 20 years, global luxury lifestyle and hospitality brand Nikki Beach has become a force to be reckoned with. We've grown organically to include 13 Beach Club locations and 5 Hotels & Resorts properties through word of mouth with our "Tell Only Your Best Friends" mantra. With three business segments including a beach club arm, a rooftop concept and a Hotels & Resorts division, there are plans to open over 20 additional Hotels & Resorts properties in the next five years.
My focus is on operations and expansion in Europe and the Middle East where we currently have properties in Porto Heli, Greece, Bodrum, Turkey and Dubai, UAE. We also just brought on a seasoned executive to lead expansion throughout China, India, Australia and Southeast Asia. In that region, we're currently located in Koh Samui where we sit on the white sands of Lipa Noi beach in Thailand. This luxury property boasts 48 incredible rooms, ranging from 2-bedroom private beach villas with pools to standalone single room bungalows to garden style villas with 1-to 5-bedroom suites. Since this was the first location in the Nikki Beach Hotels & Resort portfolio, no detail was spared when it came to this award-winning property, which is known for its five-star service and amenities. Our Nikki Beach Hotels & Resorts Asia division also took over a Chiang Mai property in March.
By breaking up the company into clearly defined segments with executives at the helm of each, I'm able to focus on operations for the existing properties in my division and develop a promising pipeline for future. All 3 properties in my region are between their 2nd and 3rd year of operations and have now reached a point where they are not only stable, but also growing. With the integration of the Nikki Beach lifestyle DNA into every property, each location is a leader in its competitive set. Our experiential luxury concept has become a sought after one.
The Nikki Beach model is an attractive one to investors as we see the value in becoming true blue partners with owners by ensuring revenue lines and a competitive profitability. With a well-balanced mix of room versus food and beverage revenues, we can create returns for hotel owners that are very interesting. As a hotel group, we understand that it's not only about creating an operationally functional property, but we have our owner's best interests in mind. Hotels are serious investments and, as operators, we need to protect the best interest of the investment. At the end of the day, we need to make a return.
At our Nikki Beach Hotels & Resorts, we get most of our management fees from a percentage of the revenue line. That said, many companies are only interested in the fact that the hotel is at capacity so they lower rates to make maximum revenues. However, in the end, the owners end up losing money due to excessive wear and tear of the location. We don't operate this way.
We have certain hotels that have achieved gross operating profit levels of close to 30% in their first year, a great token to our strategy. We not only endorse the necessity of profitability in our day-to-day operations but also understand that for success, we need to work very closely between owner, designer and operator from the design stage onward. We look to create a wonderful experience for our guests, and we build hotels that are functional and can be easily maintained for a number of years without creating excessive operating and maintenance costs.
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