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Thursday, 16 March 2023

Hilton to open 13 new hotels in Egypt by 2028

Spotlight: JJ Sleiffer, Hilton’s president for the Middle East, Africa and Turkey. JJ Sleiffer (LinkedIn) started working at Hilton in 1990 as chief steward at Hilton Amsterdam and climbed the corporate ladder over the following years, becoming a regional exec for the hotel’s European operations a decade ago. For a little over two years now he’s been managing 186 hotels as the company’s president for the Middle East, Africa and Turkey.

Hilton plans to nearly double the portfolio of properties it operates in Egypt over the next 3-5 years to reach 27 from a current 14, he tells us. The company is looking to hire 2k more employees here in the next three years, adding to its current workforce of around 6.5k people, he adds.

Two new locations to launch this summer: Hilton will introduce the Waldorf Astoria brand to Egypt with the opening of Waldorf Astoria Cairo Heliopolis, and is also planning to open the doors of the Hilton Cairo Nile Maadi, both this summer, Sleiffer says. Both hotels had been set to launch this spring, according to earlier statements from the company (here and here). The Waldorf Astoria Heliopolis has been in the works since 2018. The company is also set to fully refurbish its downtown Conrad Cairo hotel by the end of 2023, he adds.

We sat down with Sleiffer at the Hilton Cairo Heliopolis to talk more about the company’s expansion plans in Egypt, against the backdrop of changing dynamics in the sector following the pandemic, the war in Ukraine, and the Madbouly government’s target to double the number of tourists to Egypt to 30 mn annually by 2028. Below are edited excerpts from our conversation.

ENTERPRISE: What can you tell us about how Hilton’s local business has rebounded from the pandemic?

JJ: In 2022, we welcomed nearly 500k international guests at our properties in Egypt — a 20% increase from the numbers in 2019 and up 50% from 2021. Visitors from the GCC accounted for close to 25% of Hilton’s international guests at its hotels in Egypt in 2022. Our brands have been here for over 60 years, making it the company’s longest operating market in the Middle East.

E: How have you been dealing with the impact of the Russia-Ukraine war on tourism to Egypt? How has it impacted your business and the industry at large?

JJ: The number of flights to Egypt from Russia and Ukraine diminished rapidly when the conflict started, but luckily we're not dependent on one particular market.

We have seen a lot of travel agents start to put more business into Egypt and that translated into a big uptake out of the US, UK, Saudi Arabia, and Kuwait. In 2022, we saw a 60% y-o-y increase in room bookings from the US and 20% from the UK. Bookings doubled on average from our top five European markets — Spain, France, Germany, Poland, and Italy.

Don't forget that there was a lot of pent-up demand post-covid. People were desperate to travel and make that trip of a lifetime. They want to come to Egypt. I flew in with British Airways and the plane was full.

E: Many in the industry are closely following the government’s tourism strategy, which aims to double the inflow of tourists to Egypt to 30 mn a year by 2028. What do you think needs to be done to achieve this ambitious target?

JJ: I think we all agree that we want to bring the service level up. If you want to get 30 mn visitors, you have to make sure that the service is even better than it is now.

We need to have branded hotels in the places where people want them — Luxor, Aswan, Cairo and other cities too. We also have to bring home some of those Egyptians who have been learning the trade in more advanced markets to make sure we really up the game here.

It’s also all the more important to work on training people. That’s something that Hilton is very good at, and to the end we have several partnerships with local vocational schools to build the next generation of industry leaders.

E: Generally speaking, there are two ways to grow the tourism industry — upping the number of arrivals, and increasing the spend per tourist. What do you think should be the focus?

JJ: I think it should be both. I think the share of wallet is very, very important, and Egypt is already making strides on that front by offering more experiences across the country. Egypt is big enough to have many things to do, and small enough to do them all in one trip. People want to do beach and culture on the same day without having to make a long trip or fly and Egypt has that, as well as a longstanding culture of hospitality. I think Egypt really has to capture that legacy of hospitality and make sure the quality of service is of the highest standard.

E: What do you think we need to be doing to promote the industry abroad?

JJ: Well, last year’s “Follow the Sun” campaign by the Tourism Ministry was impressive and I think we need more of that. It was screened on CNN and across social media platforms, targeting tourists from the UK, Germany, Italy, France and the US.

The opening of the Grand Egyptian Museum (GEM) is another big focus. Everybody is talking about it and they really did very well at creating this hype around it. I think it's going to be fabulous.

E: From a policy perspective, what else could be done to shore up the industry?

JJ: There are excellent policies being rolled out to support the demand you’re looking to get — for example, making electronic visas available to visitors from more countries last year is a great policy, making it easier for visitors from 180 countries to visit Egypt. So things are looking better and we've seen the impact of that on the hotel industry.

Another thing that has already been in the government’s focus for a long time is building new infrastructure to make it easier for visitors to get around and see more of the country, giving them the chance to drive themselves around — especially since some don't necessarily want to be in groups all the time.

I met with Tourism Minister Ahmed Issa during my trip and he has a clear focus on overhauling the industry over the next couple of years. I told the minister that we will be working to get more investors to our brands and develop certain areas in Egypt.

I also told the minister that we are happy to help them set up systems and work with them on imagining what future hotels should look like. Maintaining the highest possible fire and other life safety codes comes top of the list.

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