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Mark Hoplamazian

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Hip Hotelier Mark Hoplamazian Looks To Life Beyond One-Night Stands

by JOHN ARLIDGE

The Sunday Times (London) December 9, 2012 Sunday

Mark Hoplamazian is embarking on the biggest expansion in the Hyatt chain's history. But can he make his Andaz brand so sexy you have to stay there?

Very sexy. Very provocative," grins Mark Hoplamazian. "But not a one-night stand. This is someone I want to get to know better."

It's the morning after the night before in Amsterdam and, over a religion-changingly strong cup of coffee, the global boss of Hyatt Hotels is trying to explain himself.

Is he talking about one of the models he met at the party he hosted the previous night, the ones wearing black patent "bitch stack" stilettos? Or perhaps he's talking about the waitress in the tight white shirt who was practically force-feeding guests Ruinart champagne from a bottle bigger than Poland? "No," he grins. "It's Andaz."

Andaz, his wife will be relieved to hear, is not a woman. It's the name of the American hotel group's new attempt to shake off its staid image and establish its own "boutique" or "design" hotel brand. As boss of Andaz and the 500 or so other hotels Hyatt runs around the world, it is Hoplamazian's job to loosen his collar and get down with, er ... well, with whom, exactly? "It's hard to tell who's going to come through the door of an Andaz. I guess we attract more original, creative types than we do at Park Hyatt," he says.

To encourage them, Hoplamazian has hired the Dutch designer Marcel Wanders - "the Lady Gaga of the design world", according to The New York Times - to create Andaz Amsterdam, formally opened last week. It is full of Wanders's witty modern take on Delft, all blue and white crockery and chandeliers. Video art adorns the walls and there are quotes from football great Johan Cruyff in the loos - obviously.

Big companies are bad at being cool.

Look at Microsoft. And Hoplamazian is an unlikely hip hotelier. His Armenian surname translates as "one who doesn't dance". But there must lurk something of the hipster behind the knot of his Brioni tie, because Andaz is working.

Try booking into the two New York Andaz hotels this week at a decent rate. You can't. They're either full or so busy a basic room will set you back $500 (£310). It's the same in Amsterdam, Los Angeles, San Diego and London, where Hoplamazian took over the Great Eastern hotel at Liverpool Street from Sir Terence Conran and turned it into an Andaz. The success has spurred Hoplamazian to open new Andaz properties in China, India, the Caribbean, Hawaii, Costa Rica and Mexico.

Boutique or design hotels are the fastestgrowing sector of the $6trillion global hospitality industry. Wealthy travellers in Europe and America seem to have an endless appetite for a lobby "scene", signature scents, hot staff and cool nightclubs, and baffling taps in the bathrooms. Newly wealthy consumers in emerging markets, notably China, Russia and India, crave a taste of what they think is the latest western edginess.

If Hoplamazian gets Andaz right, Hyatt will not only have pulled off a trick no other big hotel group has managed; he will have transformed the company into a truly global player, covering all sectors in all markets on every continent.

A decade ago, Hyatt was just another conservative global hotel outfit.

Snazzy folk liked the Park Hyatt brand, made famous by Scarlett Johansson and Bill Murray in the film Lost in Translation. Regular folk liked the reliability and low prices offered by brands such as Hyatt Regency. But it wasn't a big company playing big.

Hyatt's operations were scattered across 53 private holdings controlled by three generations of Chicago's fabulously wealthy art-loving Pritzker family, who are big donors to their city's most famous son, Barack Obama. The Pritzker architecture prize is named after the family.

In 2004, some family members decided to cash out. They asked Hoplamazian to help. He was the obvious choice; he had been in charge of the family's large business and investment portfolio for years and had become so close to the Pritzkers he was almost an honorary family member.

"In effect, I ran the family office," he recalls. That helped him to navigate the family's fractious politics and weave Hyatt's multiple strands into one business.

Tom Pritzker, executive chairman of Hyatt, reckoned Hoplamazian had made such a good fist of the restructuring that he offered him the top job. Hoplamazian was stupefied. He had no experience in hotels other than a stint on the graveyard shift at a small two-star hotel on the Edgware Road in London when he was a student for six months at the London School of Economics 30 years ago. "I was the only one on duty, so I was security, front desk, gofer, and on one memorable occasion, plumber. It was grim."

He agreed, however. His first big task was to lead the company's float in 2009. Today, the Pritzker family holds about 60% of Hyatt's equity and controls more than 75% of the voting power through a special class of shares.

Next, he turned to improving his products.

He may have been "ignorant of lodging" but he knew his way round numbers and systems. He studied economics at Harvard and worked as an analyst, banker and consultant on Wall Street before going to business school at Chicago University.

He wanted to know more about Hyatt's staff and customers, so he introduced new research techniques and created "mock up" hotel laboratories around the world to test new products and services.

These revealed that guests wanted a less formal style of service, so he gave staff more freedom to break the rules. "We don't want our people following a playbook or a script. We encourage them to do whatever they think it is the guest requires in the way he or she wants." At Andaz, there are no check-in desks: arrivals sit in a library lounge, enjoying a free coffee, wine or soda, while staff use iPads to check them in.

He found customers hated being nickeland-dimed. At Andaz all minibar soft drinks, local phone calls, wi-fi, and wine, tea and coffee in the lobby are free. Surveys showed regular customers wanted a more exclusive loyalty programme, so he rejigged the rewards scheme to offer longer stays to regular customers.

It has worked. Hyatt has grown into a seven-brand company - Hoplamazian launched the cheaper Hyatt Place and Hyatt House brands - with $4bn of annual revenue and a $6bn market value.

It's still much smaller than its rivals. Hilton and Marriott each have almost 4,000 properties, while Starwood operates more than 1,000. But being small can be beautiful.

After the financial crisis, Hyatt did not have excess capacity, unlike many other groups. What's more, the firm carried little debt and has reserves of $1bn today. "We have a very strong balance sheet and great flexibility," Hoplamazian grins.

You might think that with the West still mired in recession, Hoplamazian would sit tight and wait for an upturn. Quite the reverse: he is embarking on the biggest expansion in the company's history, opening almost 200 new hotels with a total of 40,000 rooms in the next five years. The cost will exceed $10bn. Three-quarters of the new properties are outside America and half will be in China and India.

Imagine his travel itinerary and weep. "Oh, I can handle it," he smiles.

He puts his punishing work ethic down to his upbringing in suburban Philadelphia.

The youngest of five children, he was 12 when his father Harry, a landscape designer, died from a fourth heart attack at the age of 53.

"As a 12-year-old, you don't really have great context for financial security.

No matter that your mum is saying everything is fine and you shouldn't worry about the future, I always had financial security on my mind."

Britain will benefit from Hyatt's expansion.

Hyatt has just refurbished its grandest hotel, in Portman Square in London. It spent £26m buying the Hyatt Regency in Birmingham, with another £6.5m to be spent renovating it. Hoplamazian is also looking for a site for the first Park Hyatt in London.

"Yes, there's austerity in Europe. But we're optimistic about the long-term trends. Last year, 504m visitors came to Europe - way higher than expectations. In Asia, India and even Africa the expanding middle classes, what I call the commercial classes, are travelling as never before."

Making a success of all the new properties and brands he is launching is not rocket science: "It's about keeping our eyes open and matching our innovation with what customers want."

Which brings him neatly back to the one-night stand. "Let me explain," he says. "We're creating a contemporary, stylish, sexy hotel here at Andaz Amsterdam. Too many modern design hotels are surface over substance. Great for fun - a one-off visit - but, after you've been-there-donethat, they're boring. Andaz must be richer. It must be like a person you want to come back to and get to know better."

Creating that feeling, whether it's at the Park Hyatt in Sydney or the new Andaz in Delhi, can cause "tremendous brain damage. It's really tough". But if it means his guests see his hotels as more than a one-night stand, he and his shareholders will be satisfied in all the right ways.

The life of Mark Hoplamazian VITAL STATISTICS Born: November 27, 1963 Marital status: married, with three children School: The Episcopal Academy, Pennsylvania Universities: Harvard, Booth School of Business at Chicago First job: landscaping during summer in family business Pay: $6.6m last year Home: Lincoln Park in Chicago Car: BMW X5 Favourite book: A River Runs Through It, by Norman Maclean Favourite film: Lawrence of Arabia Favourite music: U2 Favourite gadget: fly fishing rod Last holiday: glamping on Vancouver Island WORKING DAY "My best days at work are the ones I spend in our hotels, when I have the chance to meet the people who take care of our guests," says Mark Hoplamazian. When he stays at Hyatt hotels, he always requests a standard king-bed room and tries to see the hotel managers and the back of the house. Days in Chicago begin early in the morning with time on the treadmill and are filled with back-to-back meetings, but he says the best ones start with taking the kids to school and end early enough to see them at dinner.

DOWNTIME Mark Hoplamazian's routine is punctuated by rare, but equally absorbing, antidotes in the form of adventure travel and family immersion getaways, such as safaris in Africa, biking in France, and hiking in Central America and fishing in Idaho. "Nothing compares with the times when I can totally unplug and fully connect with my family while we're exploring new things together, fully immersed and totally engaged in the moment."


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