Starwood Hotels & Resorts Worldwide, owner of the luxury St. Regis and W brands, plans to re-enter the Iraqi market, almost 20 years after exiting as a result of the Gulf War.
Starwood signed agreements to operate two hotels in Erbil, Iraq, Guido De Wilde, senior vice president for the Middle East, said in an interview in Dubai today. The hotelier will operate a 250-room Four Points by Sheraton and a Sheraton property with 221 rooms and 39 suites in 2015.
Starwood opened two hotels in Iraq in 1982, in Basra and Baghdad, that were closed following the eruption of the Gulf War in 1990. Erbil is Iraq’s fourth-largest city with a population of around 1.3m. It is also the capital of Iraqi Kurdistan, which is generally perceived as safer region for business.
“Now we are going back mainly into the autonomous regions,” De Wilde said. “We saw the opportunities for new hotels that opened there like Rotana, which are doing extremely well. There are positive elements there: oil, gas and stability.”
The company is looking to operate properties again in Baghdad and Basra once the security situation improves, he said. Iraq holds the world’s fifth-largest oil reserves and a population bigger than Saudi Arabia’s. The country’s economy will probably grow to the equivalent of US$3,528 per person this year, according to the International Monetary Fund.
Starwood will also open a Sheraton in Dubai, one of seven sheikhdoms in the UAE, mid-next year, he said. The property will be located on Sheikh Zayed Road, one of the emirate’s busiest commercial streets, and will have 660 rooms, he added. The company also plans to open a Sheraton hotel in Saudi Arabia and two in Pakistan. With 50 properties under management in the Middle East, the company intends to start more than 30 hotels in the region over the next few years.
The hospitality company last week posted a more than fourfold increase in first-quarter earnings. Net income rose to US$128m, or 65 cents a share, from US$28m, or 14 cents, a year earlier, the Stamford, Connecticut-based company said.