The Shang experience, closer home

Shangri-la’s expansion in India is expected to pick up pace 

In a short time, the Shangri La at
Lower Parel, Mumbai has
become popular in the city

Metaphorically speaking, Lower Parel, or indeed Mumbai, is just about how far you could get from what perhaps James Hilton imagined Shangri-La to be. Yet that is where India’s newest and swankiest Shangri-La hotel (well, there are only two yet in India!) has opened. The Hong Kong headquartered and legendary entrepreneur Robert Kuok owned chain is arguably amongst the best known hotel groups to have emanated out of Asia. Today the group’s towering presence is perhaps best identified with the opening of its hotel in London’s newest landmark, the Shard, marking yet another step towards a more global presence for the predominantly south east Asian hospitality chain. An equally iconic opening has been by the waterfront in Istanbul. 

Delhi’s Shangri La, is an
old hotel, but its location
makes it very popular 

The growth India, long planned got off to a quick start when Shangri-La opened its first hotel in Delhi in 2005 in partnership with the Eros Group. Progress thereafter slowed down, even though at the time there was an announcement to open ten hotels under its brands Shangri-La and Traders (a business hotel brand) in the next couple of years. A tie-up for a hotel on the erstwhile Phoenix Mills site in Mumbai was announced in 2007, with a projected opening in 2009. Well, the global economic downturn, a quite a few technicalities intervened to push the opening three years back, even as the hotel became one of the most eagerly anticipated openings in the city. 

Well, the 389-room hotel above Palladium Mall is open now, and its location and proximity to Mumbai’s focal points is fast making it a favourite choice for guests. Farhat Jamal, Area General Manager (India, Maldives and Sri Lanka), says the group is “providing the Shang experience, and that’s our strategy.” Read that to mean ‘hospitality from the heart’ – a culture of showing respect, courtesy, sincerity and humility to all customers, that is a core part of the group’s offering. The vision of the group is to be the first choice for guests, colleagues, shareholders and business partners, a vision that has made it a top choice in many south east Asian cities, rivaling another group known for its antecedents in eastern luxury – the Mandarin Oriental group. “We ensure guests feel value,” Jamal says. “Our brand is a pulling factor. The Shangri-La is recognized for being luxurious.” 

The weekly flower arrangement being readied in the
vast lobby of the Shang at KL

Well, value is what is expected to rise for the group since its Mumbai opening. A hotel consultant, declining to be named, says the group is fairly well known to Indians, and the group could build on its rather distinct south east Asian identity, though more hotels in the country would help. The hotels globally are known for the group’s hallmarks – grand lobbies with marble flooring, crystal chandeliers, arresting flower arrangements, fine Asian art. Many of the hotels have the largest ballrooms in their city. The gateway city hotels, as well as most of its resort hotels, are known for their extensive facilities – both for the corporate / business and leisure traveler. This includes free wi-fi across the hotels, a key differentiator for many business travellers. Many of its restaurants, such as Shang Palace are now legendary, as is its famous Chi spa.  

A veteran of the industry, Jamal was famously the erstwhile GM of the Taj at Apollo Bunder, says the group optimistic about its future in India. With two top end hotels open, and three more in the pipeline, it can mark its presence pan India. Next in line to open is the Shangri-La, Bengaluru at Palace Road, expected to open by mid 2014. Also in the pipeline are Shangri-La Palm Retreat in Bengaluru (slated to open in 2015) and Traders Hotel in Chennai, expected to open in mid 2014. The group will look for other opportunities. “We will continue to evaluate opportunities that provide a good strategic fit and look forward to expand our brand presence in key gateway cities,” says Jamal though he cautions that expansion will only be in places where it makes sense. “Indians are travelling to places where there are Shangri-La hotels, and that is a tremendous opportunity for us.” 

Jamal is confident that as the economy get stronger, there will be an upswing in  travel, both international and domestic, helping the struggling hospitality sector build healthier bottomlines. Globally, the group has an over 40 per cent return guest rate, helped by a dedicated guest recognition programme. Its customer loyalty programme, Golden Circle, has 2.2 million members worldwide. “We have a strong global distribution network and sales offices at key source markets.”  Jamal says the loyalty programme is valuable for the group, which also has tie-ups with 28 airlines for frequent flyer programmes. 

A trishaw at the Shangri La Penang, the second oldest
Shang after Singapore, and the group’s first resort

He admits there are challenges, apart from the industry wide slump that is currently on. Added to that is a supply pipeline planned during the boom, but which for most hospitality groups, domestic or global, is coming in now. While India has 2 lakh branded hotel rooms, there will be an addition of another lakh plus rooms. Nevertheless, according to research firm HVS, Mumbai has India’s least branded hotel rooms among metros for its population – .50 per 1,000. Comparative figures for Delhi stand at .51, Bangalore .79, Shanghai 3.19, Singapore 5.59 and New York at 8.39. 

Jamal mentions inflation, increased overhead costs, energy issues, and bottomline pressures as the main challenges facing the industry today in India. He is also concerned about the changing segmentation and overdependence on the business traveler. “there is a need to bring in more leisure travelers to India,” he stresses. “Over the weekends, we see serious drops in occupancy.” This is says is unlike gateway cities globally, where rooms on weekends are at a premium.  

Brand expansion 

The Shangri-La at Istanbul is a waterfront palace

Traders, a brand that exudes functionality, albeit with a lot of style – just check the night view of Petronas Towers from its rooftop SkyBar, will be the next to debut in India. Jamal says there is an opportunity in the four star category. “All trends indicate that,” he says. Location will be crucial, he adds. Indeed, for the Delhi Shangri-La, which is a converted ITDC hotel, Kanishka, in its physical attributes perhaps does not compare to the group’s counterparts, but its prime location in Delhi’s CBD has meant it consistently has some the highest occupancy levels, about 75 per cent.  

In 2011, the group launched its third brand – Kerry in Shanghai. Positioned as a lifestyle brand for the, it is aimed at the ‘business traveler who prefers a vibrant and relaxed environment without compromising on service or quality’. The hotels are contemporary in style and offer extensive leisure options. 

 A view of the Rasa Sentosa resort in Singapore. The
group’s first hotel  opened in Singapore’s
Orchard Road in 1971

Investment in India as yet has been brand building and associate training, though the group is not averse to the ‘right investments’. He is enthusiastic about MUD or mixed-use development projects as he sees these hotels growing in strength. “Being next to a mall adds footfall. 

The group has a clear focus on the conference and MICE business as well. The Mumbai hotel for example, has a 7,000 square feet conference hall, and seven F&B outlets. “We are developing more banqueting facilities,” says Jamal. The group launched a specialized service, Signature Events, in 2007 to provide streamlined processing and specialised service delivery. “We give a written proposal to a query within six hours, and our events team is distinct. We will also have a wedding planner.  

Shangri-La’s increasing presence in the country ties India even more closely to the global hospitality market, say industry insiders. The next few openings will determine the future of the group in India, even if any approximating the literary Shangri-La serenity is achieved only within the hotel’s premises! 

Shangri-La basics 

The Island Shangri-La in Hongkong is
one of the group’s most
iconic properties

The Shangri-La story began in 1971 with the first deluxe hotel in Singapore.

The name of the hotel is inspired by the legendary far away land featured in James Hilton’s 1933 novel, Lost Horizon, set in Tibet. The name signifies a place known for its tranquility and the group has extended it encapsulate service standards for which the group is known for. 

Shangri-La International Hotel Management Ltd. was founded in 1982, and the first hotel in China came up in 1984. China was a major arena for the group’s earlier phase of expansion. 

There are currently 81 hotels and resorts in three brands throughout Asia Pacific, North America, the Middle East, and Europe, the Shangri-La group has a room inventory of over 34,000. While the group owns most of its earlier hotels, it now is adapting the management route more frequently for a more global presence. 

New hotels are under development in Mainland China, Ghana, Hong Kong, India, Indonesia, Italy, Mongolia, Myanmar, Philippines, Singapore, Qatar, Sri Lanka and United Kingdom.

The Shangri-La chain reflects owner Robert Kuok’s tastes and personality. The use of crystal chandeliers for examples is said to come from his preference for them. 

You are likely to find a copy of Lost Horizon in the hotel rooms.  


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