Luxury hotels in Porsche design: the Steigenberger boss has big plans

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“The Zero Hour”
Luxury hotels in Porsche design: the big plans of the Steigenberger boss

When Marcus Bernhardt became CEO of Deutsche Hospitality in November 2020, his wife warned him whether he really wanted to do this to himself in the middle of the pandemic. But the job appealed to him: such a traditional company with the flagship Steigenberger, just bought by a Chinese investor, eight brands, big expansion plans. And now that even Germany is heading for a kind of “freedom day light”, the hotelier also sees “light at the end of the tunnel”. And Bernhardt certainly doesn’t want to be dissuaded from the expansion, even if the goals – from 120 to 600 to 700 hotels – have to be stretched. The “timeline” now runs to 2027 instead of 2025.

However, growth in Europe will be somewhat delayed. “I’m a bit concerned about Europe recovering so quickly,” said Bernhardt in the podcast “The hour zero”. The “regeneration phase” could last until 2024. He sees targets for acquisitions more in the Middle East and in the Asia-Pacific region, where one would “put out feelers”. The small hotel groups in this country have also received state support, so that they “financially don’t currently feel any pain from having to sell”. In addition, the asking price is too high.

Prestige project with Porsche

The focus for new hotels is primarily in the mid-range and economy segment, where Deutsche Hospitality is active with the young Zleep brand, among others. “We see that there is a great need,” says Bernhardt. “The brand is very well known in Scandinavia. We are opening the first store in Madrid this year and we have over ten stores in the pipeline to open over the next 18 months.” The Intercity brand is also growing strongly – the group also wants to score points in the lifestyle area with the “House of Beats” brand, where they want to open a hotel in Hamburg’s HafenCity. With the also upscale lifestyle brand “Jaz in the City” they have houses in Stuttgart, Vienna and Amsterdam and are planning one in Dubai.

“We’re going into completely different spheres, which you wouldn’t think of as a traditional hotel group,” Bernhardt said of the expansion, which the “Süddeutsche Zeitung” described as “one of the most ambitious projects in the German hotel industry”. Another “baby” is a project with Porsche Design, where they want to create a “new luxury lifestyle brand” under the Steigenberger umbrella brand and open 15 to 20 stores in the next two to three years.

The lockdowns and restrictions have hit Deutsche Hospitality – which was acquired for €700m in 2019 by Ji Qi, founder of the Chinese hotel group Huazhu – hard. The turnover of 830 million euros was roughly halved by Corona. Did the operator of Steigenberger, founded by Albert Steigenberger in 1930, feel they had enough support? “No,” Bernhardt said firmly. As a larger medium-sized company, the aid would have had its limits. “In the last two years we have had to write losses in the hundreds of millions.” If you hadn’t had an investor “who believes in us and the company and who was willing to bear the difference, it would certainly have been difficult for the company.”

However, Bernhardt showed understanding that the state cannot “support the industry ad infinitum”. The only thing missing in Germany is someone who feels responsible – such as a tourism minister in Austria. “That’s missing in a country like Germany, which attaches great importance to its tourism. We are poorly represented there, with no ministry that is responsible.”

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