Raoul Thomas is CEO and founder of Miami-based CGI Merchant Group which has a partnership with Hilton to open three new brands of ‘conscious’ hotels.
“Consumers are focussed on seeing meaningful change, so our decision was to have a unique operating model attached to brands and values, and for us, that was brands centred around an ESG strategy. We think the standards for the E and G (In ESG) are there for us – we have green buildings, we will be energy efficient and we will be mindful of recycling, but we want to focus on the Social part.”
“What we are saying is that we will give one per cent of top line revenues to the communities around our properties, and over time that will be millions of dollars over the year. We believe that the communities around us have to thrive for our investment to have value over time. It doesn’t make sense to have a beautiful high rise building in an urban core where everything round it is impoverished. The more we can impact and drive development and make progress in those human needs around us, the more the value of our asset goes up.”
“We would want to try and encourage the guests to experience the investments outside the hotel. So, for example, if we make micro loans to a nearby restaurant, then we would encourage them through the concierge to go and experience the farmers market and dine in the neighbourhood at that restaurant, and we believe from our studies that they want that sort of experience beyond the walls of the hotel, and we think that outreach and engagement will bring a lot of brand loyalty.”
“On the business side, our studies have found that people will pay a five per cent premium to Average Daily Rate (ADR) and will also stay longer. We think also that as you go through cycles in the hospitality market, customer loyalty will be stronger where they see strong brand values. So we are saying this is accretive over time, but to be clear, this one per cent of top line is coming out of our share, not the consumers. It’s not a levy on the hotel room. And we want to make sure that we can measure the good that has been done, and we have contracted with a third party group to measure it, so if you stay in one of the hotels you can see the different the money has been made.
“So far we have two hotels in Miami: one of which will be the Gabriel Miami Downtown and we have just acquired another hotel on Ocean Drive which will become the Gabriel South Beach. In total we have three brands: the Selina brand which will be under the Hilton LXR brand, the Gabriel which will be under the Curio, and the Kelsey which will be under Tapestry by Hilton.
“We have also signed for another hotel in Atlanta which will open in 2023 as a Kelsey. It is next to Atlanta Morris Brown College, a Historically Black College and University (HBCU) built in 1881, with a campus which is a stone’s throw from the Mercedes Benz Stadium, home of the Atlanta Falcons NFL. The university is launching a hospitality programme, so we were able to get Hilton to help to develop the curriculum, extend its personnel as visiting professors of the programme, and we can also recruit the talent from that programme for our hotels. You can do good while making money.”