Patrick Fitzgibbon: Senior vice-president of development for Hilton Hotels, Africa and Europe

Hilton Hotels recently announced it was looking to establish an upmarket hotel in Cape Town – its first in the city. TradeInvestSA spoke to Patrick Fitzgibbon, Hilton's Senior Vice President of Development: Europe & Africa, about Hilton's plans to expand its presence across South Africa.

Hilton already operates two hotels in South Africa. What has been the delay in opening a hotel in Cape Town?

We already have hotels in Johannesburg and Durban and while we’ve looked at opportunities in Cape Town in the past, we’ve never quite found the right one. I think the fact that we’ve put a developer in that market will make all the difference.

In some respects not having a hotel there today is almost a strength for us because we now have so much demand for one. We are now focused on growing that market by having a developer who can get to know the local market and find the right relationships for us to grow.

How are plans for the Cape Town hotel progressing, and do you have a timeframe for the project?

We’ve had a number of discussions in recent months and we’ve also had a number of people approach us about opportunities both for existing hotels as well as development opportunities to build new hotels.

So there are a lot of discussions already on the table and now it’s a case of working with those developers to see if we have the right ones or whether we need to continue looking at new opportunities.

Obviously one wants to grow as fast as one possibly can within the constraints that are around us today, and the lending constraint is a global problem. For us it’s about making sure that we look at every opportunity in the market.

Would the Cape Town site also be an upmarket hotel?

The way we position Hilton globally is as an upmarket hotel, but there will be a larger leisure mix in the Cape Town hotel, as it will be a hotel that attracts both business and leisure guests.

That’s the beauty of Cape Town, it’s such a terrific tourist destination as well as business destination. That’s the best way to optimise any hotel investment, by creating demand during the week as well as at weekends.

Is Hilton considering introducing other brands to South Africa?

Yes, very much so. I think one of the benefits we now have (following the merger of two separate Hilton organisations three years ago) is that we are able to take some highly successful US brands and introduce them to new international markets.

In a market like Cape Town we see opportunities not just for our upmarket 5-star Hilton Hotel project but also additional opportunities in both the economy and mid-market sectors.

Is this the start of a larger expansion for Hilton in South Africa?

Absolutely, the rationale behind our office and our focus on Cape Town is as a geographical base across the whole of the continent, but in particular South Africa.

I’m already looking at opportunities across South Africa, and not just in major cities but also in the secondary cities, for mid-market products like Hilton Garden Inns, which would work extremely well in secondary locations.

Would you locate the Hilton Garden Inns brand at all the major airports?

Absolutely, that’s our strategy. I think that one of the real opportunities across many African markets is to produce a really good mid-market hotel at airport locations that would not only suit international travellers but also domestic and regional travellers.

People often reference international brands as being key drivers to attract international travellers, and while that is correct, recognised brands also attract both regional and domestic travellers.

Everywhere in the world people are travelling more within their own communities, as well inter-regionally and internationally, and I think that’s one of the real opportunities.

Has the forthcoming World Cup played a part in the decision to invest further in South Africa?

One of the things that South Africa has going for it today is the tremendous energy and movement around its profile globally. I think for any market it [the World Cup] drives huge interest, and I think that’s one of the real opportunities.

The reality is that Hilton has been looking at Cape Town for a long time. While we’ve certainly stepped up our activity there’s no way we’ll have a hotel open for the World Cup. If we’d chosen the World Cup as a catalyst, we’d have to have made that decision five years ago; but it is a contributing factor in the popularity and success of South Africa.

There are two things I applaud particularly about South Africa at the moment. One is having secured the World Cup. However the other thing South Africa did recently, which has given it tremendous impetus, was securing the Indian Premier League (IPL).

The fact that South Africa managed to secure the IPL in just three weeks; secure it away from the UK, and host it so wonderfully, says an awful lot about South Africa both as a business destination but also as somewhere to visit.

It inspires people to make things happen and I think there’s so much energy around sport and South Africa that it can only be good thing.

With the current difficulties in the tourism industry, how do you think the sector will hold up over the next 12 months?

Travel plans have changed massively in recent years following the emergence of budget airlines, and despite the protestations of many, travel is here to stay. I think it will grow and grow, and as that happens the opportunities for travel will grow with it.

If you look in Europe currently, the people who now travel on budget airlines week in and week out would never previously have dreamed of taking more than one flight a year for their annual holiday.

There has been a huge change in the way we travel, and as travel becomes more affordable the opportunities are extensive globally, because I think travel will just continue to explode.