Published: 13 November 2023
Discover how Aleph Hospitality operates as a third-party white label hotel operator, providing flexible management services for hotel owners across Africa. Explore the unique challenges and benefits of their model, including flexibility, shorter contractual terms, and street-smart management that leads to higher profitability. Learn about Aleph Cares, their sustainability and social responsibility program, and how they engage with local communities in Africa.
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Matthew Weihs (00:01.346)
Hello everyone, Matthew Vice here with the Africa Hospitality Investment Forum podcast, the podcast that looks to open the doors and have a look inside the world that is the investment world of hospitality in Africa. I'm here today with Barney Haddad, the Managing Director of Aleph Hospitality. Welcome Barney, welcome to our podcast today.
Hi Matt, thank you for having me. Great to be having this chat today with you.
Matthew Weihs (00:32.918)
But it's good to see for those that don't know much about a left hospitality at this stage, why don't you give a quick start off by giving a quick overview to the organisation and what it is that you do on the content.
Sure. Thank you. So for those who don't know us, we are a hotel operator, an independent hotel operator, what is commonly referred as third party white label. There are many names. Essentially, we're just a fully fledged operator. And we've been in the African market. I think we were the first, but I think I'm pretty sure we were the first to establish this model on the African continent eight years ago.
We're today the leaders. So what we do is provide hotel management services for hotel owners under different brands or under no brand. The idea is really to have an operator who's working alongside the owner on a day-to-day basis. We can talk a little bit about the benefits. We're based in Dubai, but we have a significant presence in Africa.
from east to central and west, and with the regional offices as well in Africa. It's a market which is very, very important for us, where we see massive, continuous massive potential in the years to come.
Matthew Weihs (02:05.906)
let's talk about why then it is important. Third-party management has become more and more prevalent over the last decade anyway, so why is this now such an important consideration for owners in the market?
So if you go back at the fundamentals of the independent hotel management model, there are three components which always make the owners quite interested. But in reality, it's not only the owners, it's also the hotel brands who are increasingly interested in the model. So for the owner, what we're doing is we're providing a lot of flexibility when it comes to the day-to-day
management of the hotel and some of the most of these owners they want to have their word to say they want to be involved in the day to day so we give them this flexibility and because we are a human sized organization we're much more reactive than a much bigger organization with multiple layers of approvals and you know reporting structures we're much more dynamic from that sense so this hands-on and flexible approach is one of the elements that owners like.
The second one is related to the contractual terms, where we provide really much more flexible contractual hotel management agreements, shorter obviously, straight to the point. We try to accommodate most of the owner's requests. We can talk about these in detail at some stage if needed. And then the third pillar of our model is really because...
We kind of manage these hotels and it's almost in a street smart way. We tend to generate higher profitability than the typical model that the region is used to. That's the reason why the model is so prevalent in the US and more and more in Europe. For the brands, the reason why they are also more and more interested in this model is that we almost act as their...
internal development team, we go out and source deals for them because we're talking to hotel developers directly as well. And this gives them the opportunity to grow their portfolio faster by going places, secondary cities, maybe smaller hotels, which they wouldn't be interested to do directly under a management agreement. So for the brands, and at the same time, we're guaranteeing the level of service.
quality that they would expect from their own teams when running the hotels. So it's a win-win situation for the brands, for the owners and obviously for us.
Matthew Weihs (05:02.113)
Now, I know that obviously this brings in a lot of employees from the local communities and so on that are around them and such like. Tell us a little bit about Left Cares and how that plays a part in maybe the discussions with those both parties and how you work.
between the local communities, the people that work there, and the sort of give back that you're focused on.
So Aleph Cares is our program, is a program we've created, launched about 18 months ago around the sustainability and the social responsibility. And one of the major steps we've done, we took this very seriously in the sense that we've appointed an Aleph Cares champion manager for each one of our properties.
didn't want just to create a program, launch it, give a training, and then just let it live. We wanted to really have someone on property who's in charge of this. And we have our head of training and support who's on a corporate level heading this program, Steve. He has monthly calls with them. And the second thing we've done is we made the KPIs of our general managers.
to include, you know, AlephCare's objectives. And this is very, very important. And we are seeing, you know, the results, especially in Africa, where, you know, other than, you know, planting trees in the Karuna forest or in Kenya or other, you know, eliminating all plastics, most of a lot of our general managers are doing social work with their teams. And for a company who's developing and growing in Africa...
Matthew Weihs (06:58.314)
Our owners are loving this when they see us going out, reaching to the community. I remember this, one of our general managers in Uganda, he was just going back to the hotel and he saw next to the hotel a small village and kids playing. So he went to the hotel, he got a cake, he came back and he just had completely spontaneous celebration with a few cakes with them. And it just created...
such a good ambiance and atmosphere and this integration with the local community is extremely well perceived by our hotel owners because they're locals. Most of our hotel owners are, you know, African locals and they don't want just, you know, a big brand coming or someone based from Dubai and come and run, you know. They really want to feel that we're with them. We're trying to give back as well to the local communities. And we have numerous examples.
like this, whether it's the activities we do with the Red Cross in Kenya or orphanage centers in Ethiopia, we have a number of activities and we're really the teams are very, very excited about this, really passionate about it.
Matthew Weihs (08:18.012)
So in some ways I picked up on that because I was
It was touched upon in your session in the do's and don'ts of the hospitality industry in the sense of trying to, you know, actually be part. It was interesting how that conversation went. But I wanted to pick up on that. So I'm alluding to this session that we ran in Kenya in June of this year. What, you know, you had some great players on that, that particular session, Rahul and...
Matthew Weihs (08:51.322)
and Billy and yourself. So what did you sort of get from that? What do you think are the sort of three main takeaways if I can take you back there from that session?
So I think, Matthew, you're probably referring, and correct me if I'm wrong, you're probably referring to the question towards the end of the session from one of the delegates in the audience, who basically was challenging us as owners, Rahul and Billy, and us as operators, about promoting and having Kenyan general or local general managers.
And listen, my view at that point was saying, listen, you're absolutely right. There aren't many, but there are. And you shouldn't say that there aren't. I mean, we have, as an example, I give a couple of examples, but we have the first Kenyan GM, we are appointed in Kenya and Eldoret and one of our hotels in Eldoret, but also the other example, you see that many of them move around, so especially the Kenyans, they are, you know,
really they have this infrastructure of hotel training and schools which is allowing them to export this talent in Africa, East Africa predominantly, but you will find some Kenyan managers across the continent.
You know, the recruitment of talent is a local talent is still remains a challenge. You know, we're not, we're not hiding when we're not saying it's all good and all green, but there are very good elements. And sometimes the challenge we face is that they want to leave their country. They want to come to Dubai. They want to go to Europe. They want to go to Saudi Arabia, et cetera, because they want this international experience. Um, but.
What it also told us that, you know, it's exactly to go back to my previous point, local developers, investors, they want and they're very keen to have the local communities taken care of, you know, their people taken care of. And really that's what we, that's what we aim for. You know, we, as I told you, you know, we have a lady Kenyan general manager. We have another gentleman now as well, who's Kenyan, who's a hotel manager.
So it is something in Ethiopia, we had the first female general manager, the Ramada, who was Ethiopian. But so it's something that we're really very keen on, you know, pushing and showing the example that it can be done. We just have to break this barrier. It can be done. You have a lot of talent.
Matthew Weihs (11:43.342)
Matthew Weihs (11:46.438)
You mentioned a few of the developments and properties that you've now are managing and some of the challenges. What does the plan look like for you in growth terms now across the continent?
So we're very present in East Africa now, Kenya, Ethiopia, Tanzania, Uganda, Rwanda. And we're making a big push in central and West Africa. We're opening in Kinshasa in a few months. We're opening in Accra as well. We have a development underway in Liberia. And so Africa for us is a continent where we see by the end of 2026.
11 properties now there. And by end of 2026, we think we will be around 30, anywhere between 30 to 35 operating hotels in Africa.
Matthew Weihs (12:51.126)
South Africa into the Middle Eastern Saudi. How's that looking?
Saudi Arabia and the Middle East is a major market for us. We recently opened an office in Saudi Arabia. We have the head of the country and development and we're adding resources in Saudi Arabia. We've opened a big hotel in Doha right before the World Cup for 150 keys. We have really exciting developments in Saudi Arabia and in Dubai.
which we will announce during the conference in Abu Dhabi. So I'm not going to spoil the news now, but so the Middle East is... Yeah. No, the Middle East has been a focus in the last couple of years for us, and now we're seeing the results of all these efforts materializing.
Matthew Weihs (13:32.447)
Oh, how fantastic!
So for anyone picking up on this, go there to here. Go there to here. Yeah, absolutely. No, that's great.
It's a brilliant market, especially Saudi Arabia.
Matthew Weihs (13:57.038)
Is there any market differences between the type of work that you get between African countries and maybe the Middle East and Saudi, or is it sort of all very similar?
Yeah, you know, first of all, the scale of the hotel is obviously different. So the average African hotel is much smaller than the average Middle Eastern hotel. Then the challenges, the operating challenges are very different when it comes to, for example, the supply chain. When it comes...
certain countries, you know, you have forex regulations and, you know, challenges in paying your suppliers who are international, who need dollars or euros to be paid. So, which is not, which are not things that we face in the Middle East. But listen, I mean, we've been there, as I said, we've been in Africa, Aleppo has been in Africa for a long time, and we became experts in
operating in these markets, navigating the challenges, having solutions for all of these, anticipating most of the most important is anticipating especially when it comes to recruitment training and the supply chain. These are areas where you really need to anticipate and have general managers on the ground who are fully conversant with the local cultures and what
the challenges around these aspects.
Matthew Weihs (15:38.582)
Finally then, before we leave you to grow the business to 30 properties, tell us more about your Foshron partnership.
Yes, thank you for asking me. That's a great partnership we have signed with Fauchon. For those who don't know, Fauchon is one of the most recognized French sweet brands. They're known for their macarons. They're very well known for their tea. Traditionally, they've been known to bring exotic products to Paris, but they have the best pâtisseries.
and suites in France for their catering business. And a few years ago, Fochon decided to launch a hospitality business and they opened their first hotel, Place de la Madeleine, where their home is basically. And then they opened one in Kyoto. And it's a beautiful concept, which we feel is really fit for the Middle East and for the changing times. So we've signed a partnership with Fochon.
to grow their footprint on an exclusive basis in the Middle East and Africa and operate these Fourchon hotels. We're really excited. So the Fourchon, there are a couple of elements which are really very distinct boutique, very boutique-ish hotels. So 70 to 100 quays max, luxury level, centered around the glamorous Parisian, French, and
atmosphere, ambiance, and this has declination. And the food, of course, because Pochon is extremely well known for the food. So food is something, the culinary experience is something which we put a lot of emphasis on it. But it is also a hotel which is designed with the female traveler in mind. Recently, Pochon Paris won the She Travel Award.
and there are many elements whether it's regards to security, the design of the room, the amenities which are really targeted for the female traveler which is something very unique. Thank you.
Matthew Weihs (17:57.35)
It's fantastic. Yeah, congratulations. Yeah, it is. And yeah, I was having a look at it and thinking what a lovely product it's going to be. So good luck with the growth of that. Finally, I guess just to say thanks again for your support for the last few years of AHIF and all the other events that we do. Looking forward to seeing you in Namibia in June. Any sort of thoughts on
Matthew Weihs (18:26.242)
the sadic region for your work at the moment. What's that sort of bringing up? And then we can leave it there.
Yeah, sure. We listen first of all, thank you as well, Matt and the bench team for your support as well. You've been with us since the inception of the company, so that's something we really like. For the SADC, our pipeline and you know, in all transparency is still relatively weak. And we've been just extremely busy, as I said, in East Africa and now West and Central.
But it is a very exciting region, looking forward to being in Namibia for the next conference. It's a good market. South Africa, of course, is another market where we have active discussions and we hope to operate a couple of hotels next year.
Matthew Weihs (19:22.438)
Thanks for joining us, Bunny, and good luck with everything.
Thank you, Matt, good talking to you. Bye.
Matthew Weihs (19:27.65)
Take care, bye bye.
so we don't.