Quinn Hotels Business Statement Page 1

Contents Page

1. Purpose of the Report ….…………………. 3 2. Overview ………………………………………….4 3. Demand …………………………………………..5 4. Competition ……………………………………. 7 5. Tourism ………………………………………….. 8 6. Access ……………………………………………. 16 7. Employment ……………………………………. 17 8. Recruitment ……………………………………. 18 9. Training ………………………………………….. 19 10. Procurement …………………………………… 20 11. Local Support ………………………………….. 22 12. Summary ………………………………………… 24

Appendices …………………………………………………. 25

Appendix 1: Competitor SWOT Analysis..……….. 33

Appendix 2: Procurement ………………….…..…….. 42

Quinn Hotels Business Statement Page 2 1.0 Purpose of the Report

This report has been prepared by Quinn Hotels to describe the business rationale for the proposal to construct a new five star luxury golf resort hotel on the site of the existing Belfry Hotel and Golf Centre. The proposed development represents an exciting opportunity for the local area to accommodate a truly international standard facility, building on the iconic reputation of The Belfry in the sporting world and the potential to extend this into the international tourism market.

This report commences with an overview of the business objective of Quinn Hotels having taken over the Belfry in 2005 and having obtained full operational control in 2007. The decline in the attractiveness of the current hotel facilities to the corporate and business tourism markets is described in terms of the current and projected decline in revenue and departure of major corporate clients. The report then describes the competition that exists to the current hotel and establishes the market within which the new resort hotel will compete. In comparing this market, the report establishes the characteristics of the new development in terms of visitor profiles, the likely occupancy levels and length of visitor stay.

The report addresses the extent to which The Belfry can make a significant contribution to tourism in the region, including business tourism which is a major component of the area’s hospitality industry with major growth potential.

From a business perspective, the report describes the accessibility of the location for customers and staff and sets out the likely employment benefits of the new proposals The new Belfry will focus on delivering a ‘green footprint’ and while matters of sustainable development and energy conservation are dealt with in other reports submitted along with the planning application, Quinn Hotels has initiated, and would intend to continue to re-source produce and services for the Hotel from local producers. This matter is addressed in this report

Quinn Hotels Business Statement Page 3

2.0 Overview

The key focus behind this Business Statement is to demonstrate the need to develop The Belfry Resort into a world class venue that brings business to the Midlands that would otherwise choose European and UK destinations

Currently, the Midlands does not have an International five Star hotel or Resort and one would have to travel 65 miles from The Belfry to find the first option which is a small boutique Bed & Breakfast in Gloustershire (see Map 1.1) Map 1.1

The Hotel intends to highlight a link in the decline in sales and profits with the long term underinvestment, with an additional link to improved competition

Quinn Hotels Business Statement Page 4 3.0 Demand

Current Business Performance

3.1 Revenues and profits at the hotel are continuing to fall well short of targets and showing little or no growth on 2006, this is as a direct result of product. The hotel has had little investment over the last 10 years whilst part of the De Vere group. This has resulted in a continued migration of business to competitors that have demonstrated refurbishment and development over the last few years.

3.2 In the budget year 2006, the hotel’s sales fell by 3% (£1 million), currently The Belfry is trading 4% down on 2006 in total sales for the months January to August ‘07, which demonstrates a continued downward trend. (Table 3.1)

3.3 Customer and intermediate feedback supports the relationship between sales and product, this is called a price/ value matrix, which is monitored periodically, this enables The Hotel to flex our prices to react to the sensitive nature of the customer reaction to product and as demonstrated, this is now unsustainable.

Turndown Business

3.4 Over the last 2 ½ years The Belfry has turned down over £46 million worth of business due to “no space available”. This is as a direct result of the hotel’s size which limits the number of events that it can hold. (Table 3.2)

3.5 There are only 40 venues in Europe that can hold a banquet for more than a 1,000 people and accommodate 500 bedrooms overnight. When you add 5 star, golf and Spa into the equation, then the UK is negated as are most European venues. This is further demonstrated by the fact that the hotel has lost £10 million over the last 2 ½ years due to the “event being too large”, whilst loosing an additional £31 million to client moving to “other cities”, of which Europe features highly.

Quinn Hotels Business Statement Page 5 3.6 The Belfry has a unique opportunity to build an international venue that is outside North America that is capable of meeting the needs of most clients, whilst being able to demonstrate the demand to fill the venue. In the last 2 ½ years that the hotel has been tracking, it has recorded £275 million worth of unrealised business, with reasons ranging from “No Decision Made” to “Budget too Low”

3.7 As the hotel operates in a very specific market, the loss of potential business is partially absorbed by the local market, but mainly by venues outside of our region. The development of The Belfry would consolidate the 4 star business currently in the region and secure new 5 star business from outside the Midlands.

Accommodation Statistical Trend

3.8 Average rates continue to either decline or hold static year on year as the impact of not having the volumes from the business tourism market take their toll. (Table 3.3)

3.9 Occupancy, as with rate, is in decline as a result of the declining business tourisms. (Table 3.4)

3.10 With erratic performance in the above indicators, RevPAR (Revenue Per Available Room) is generally in decline. (Table 3.5)

3.11 In summary, as a resort, guests who stay over night generate the majority of the revenue. Since occupancy is in decline, so is the resort’s revenue.

Quinn Hotels Business Statement Page 6

4.0 Competition

4.1 The Belfry’s competitor set is due to change significantly, currently the hotel competes in the Midlands market, with some loss of high profile Golf and Business Tourism events to the future competitor set as a result of prestige, quality of product and facilities on offer. (See Appendix 1)

4.2 The Belfry believes that the Blue Chip customer is a little more discerning, and looks for a product that they would wish to use as a leisure guest, so the size of bedroom is very important, as demonstrated by the extensions at Hanbury Manor & Celtic Manor, along with the new build of The Grove. The Belfry’s current average bedroom size is 24 sqm, where as the competition are 30-46 sqm on average.

4.3 The development will further enhance the local economy as they will not be competing with the local hotels, but rather taking business from other regions and overseas

Current The Forrest of Arden Marriott Leicester Hilton Metropole Q Hotelm Chesford Grange Paramount Hinkley Island Hotel

Future The Grove, Hertfordshire Gleneagles, Perthshire Turnberry, Ayreshire Celtic Manor, South Wales K Club, County Kildare Hanbury Manor, Hertfordshire

Quinn Hotels Business Statement Page 7

5.0 Tourism

None Belfry data has been researched from the following sites: www.visitbritain.org www.enjoyengland.com www.birmingham.org.uk www.warwickshire.gov.uk www.tourismtrade.org.uk

Inbound Tourism

5.1 32.1 million tourists visited the UK in 2006, which is 7% up on 2005’s figure of 30 million. Key revenue markets in 2005 were USA (£2,384m), Germany (£998m), Ireland (£895m), France (£796m) and Spain (£697m). The graph below shows the movement in foreign leisure & business tourists 200 – 2005, a steady rise can be seen after 9/ 11. (see Graph 5.1)

Graph 5.1 Visits to UK by reason

12,000

10,000

8,000 ) 0 0 0 ( 6,000 s t i s i V

4,000

2,000

0 2000 2001 2002 2003 2004 2005 Business 7322 6778 7158 6967 7470 8168 Holiday 9302 7585 7735 7973 9275 9713 Misc. 2065 1964 2206 2174 2564 2797 Study 686 609 682 623 585 605 VFR 5834 5898 6398 6978 7861 8687

5.2 The Graph 5.2 shows the visitors to Central England, which demonstrates significant growth of 17% for Central England in 2005 v 22% in West Midlands, with both ahead of the total England growth of 8%, indicating the growing demand for the West Midlands.

Graph 5.2 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 2000 2001 2002 2003 2004 2005 Central England 30,855 27,373 32,272 32,575 34,476 40,590 West M idlands 10,741 8,699 11,471 11,054 10,937 13,314

Quinn Hotels Business Statement Page 8

5.3 In 2006, 98% of The Belfry’s business was domestic. This continues to be a challenge as the product is not up to international standard, especially to the US and major European countries (France/Spain/Germany/Ireland) who would visit the hotel as the most famous Ryder Cup venue

UK Tourism

5.4 UK domestic tourism total revenue fell by 9.5% in 2006 over 2005, with revenue from residential stays dropping by 5%. This trend was reversed in the West Midlands, with a growth of 125%. See graph below. (see Graph 5.3)

Graph 5.3 – Domestic Tourism2005/06 £14,000

£12,000

£10,000

s £8,000 n o i l l i £6,000 m £4,000

£2,000

£- UK Residential West Midlands

2005 £11,492 £508 2006 £10,906 £1,145

5.5 Despite the West Midlands upward trend, graph 5.4 shows the decline of domestic tourism at the Belfry, as the condition of the hotel continues to drive business away from the hotel. In 2006 Jan – May room nights dropped by12%, with this trend continuing in to 2007 with a further decrease of 17%. (see Graph 5.4)

Quinn Hotels Business Statement Page 9

Graph 5.4 – Leisure Business @ The Belfry 2005 - 07 2,500

2,000 s t

h 1,500 g i N m

o 1,000 o R

500

0 Jan Feb Mar Apr May

2005 1,432 2,013 1,686 1,302 1,207 2006 1,125 1,826 1,060 1,885 834 2007 934 1,194 1,264 1,189 970

5.6 The Golf break market is the one consistently improving area of the business as the hotel has invested over £1 million on the Brabazon Course in the last year, which has been supported by a strong marketing message. (see Graph 5.5)

Graph 5.5 – Golf Breaks Business @ The Belfry 2005 - 07

900

800

700

600 s t h g

i 500 N

m 400 o o

R 300

200

100

0 Jan Feb Mar Apr May

2005 38 115 442 583 635 2006 133 317 448 729 448 2007 343 361 555 714 799

5.7 The continued growth in the golf market is not without its challenges, as the bedroom offering is poor, which is highlighted by the fact that the PGA refuse to bring back the Ryder Cup until such time as a major refurbishment of the bedroom and public facilities are carried out

Quinn Hotels Business Statement Page 10

5.8 The Belfry believe with a fair wind, it could be ready to help support the 2012 teams acclimatization, in the build up to the Olympics, with support from Aston Villa’s Bodymoor Heath Training Ground. This would be an aspiration to ensure that the international market get an early opportunity to sample the new Belfry.

Business Tourism

5.9 This market accounts for 59.5% of the business, but is a declining market due to the condition of the product. This can be seen in the below graph, the market has been in decline for the last 2 years, with 2006 finishing 3.1% down on 2005 and 2007 forecasted to be 14.6% down on 2006, an overall drop of 17.2% in 2 years for the hotel’s most influential market. (see Graph 5.6)

6,000 Graph 5.6 – Business Tourism @ The Belfry 2005 - 07

5,000

4,000

3,000

2,000

1,000

0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2005 4,873 3,262 3,877 4,559 3,659 3,657 3,462 2,861 3,747 4,151 5,426 2,750

2006 4,589 3,629 4,685 2,368 2,570 3,799 3,380 3,404 3,954 4,730 5,301 2,451 2007 4,417 3,237 4,535 2,816 2,787 2,951 2007 F/C 2,951 2,273 2,087 2,566 3,563 4,257 2,818

5.10 This is also reflected in the declining average length of stay for this segment, which was 1.41 in 2005, 1.33 in 2006 and currently year-to-date it is 1.31. Again based on year-to- date, the average room rate is down 4% (£5) against 2006.

5.11 When benchmarking the competitor set (TRI) it is clear that the market is in decline, as year-to-date (April 2007), the market is down 12% whilst The Belfry is down 19%, and believes that the imbalance is a direct result of product

Quinn Hotels Business Statement Page 11 5.12 To demonstrate this further, the hotel estimate that in the last year it can qualify £1m worth of business that will not repeat due to the poor product and are thus taking their business out side of the local area to some of the hotel’s key competitors, the clients are: • A FTSE 100 Telecommunications company • A FTSE 100 Aerospace & Defence company • A leading chemicals company • A leading Educational organisation • A Leading food manufacture

5.13 In addition the following Business agents have also either refused to place business with us or show considerable resistance: • Hotel Brokers • Calder Conferences • Conference Call • VH Venues • CWT • Jenny Wilde Associates

The hotel anticipates this trend to continue without major investment in the property

Quinn Hotels Business Statement Page 12

Transient Market

5.14 The nature of guests that visit the hotel as transient guests are generally not using us it as a resort, but rather as a base for the local area, as such price is the key motivator, reflected by declining rates year-on-year. The important thing to note about this market is that it is not a high repeat market as with others, so the product does not present the same barrier as it does to repeat custom. The graph below clearly demonstrates the growth, this is as a result of more availability due to the decline of the Meetings market. This segment of the business has a high proportion of individual travellers, who have a low average length of stay, resulting in increased travel. (see Graph 5.7)

Graph 5.7 – Transient Accommodation@ The Belfry 2006 - 07 2,500

2,000

1,500

1,000

500

- Jan Feb Mar Apr May

2007 2006

Distribution

5.15 Distribution shows that most of our business comes to the hotel directly/agent (Table 5.1), whilst this is not a major issue, the hotel does recognise that the level of business being generated by GDS (Global Distribution System) is negligible, yet the hotel is internationally famous, but as a Brand it has a “tired” reputation, so whilst there is a lot of business in the market, The Belfry is only achieving 37% of its fair share, which ranks it 8 of 8 in its competitor set. (Table 5.2)

Quinn Hotels Business Statement Page 13

5.16 To help market the hotel better, The Belfry would like to join an established deluxe consortium such as Small Luxury Hotels or Leading Hotels of the World, but they will not consider the hotel in its current condition

Nationalities

5.17 As a venue that has held the Ryder Cup 4 times, it’s international recognition is very high, especially in the US market, but as seen in the above pie chart, 98.7% of its business is domestic as the product is not suitable to the overseas market as the bedrooms are too small and lack air conditioning. From a security point of view, with its current foot print, the bedrooms, resort facilities and car parks are too exposed and do not lend themselves to the same level of security as demonstrated in competitor resorts. (see Graph 5.8)

Graph 5.8 – Nationality Mix @ The Belfry 2006

Ot h er 1 .3 %

Uk 9 8 .7 %

5.18 As a benchmark, the hotel’s competitor set would average 80 – 85 % UK mix with an Average Length of stay of 2.5 nights compared with its overall average length of stay of 1.3 nights.

Quinn Hotels Business Statement Page 14 Occupancy

5.19 Using 2006 as it has a full year worth of actual data, The Belfry recorded an overall Average Length of Stay (AVLOS) of 1.3 nights, this was based on an occupancy of 80.1%. Each key segment has been defined with a contribution mix and AVLOS. (Table 5.3)

5.20 Occupancy at the resort would naturally reduce due to the nature of the proposed business mix, changing to a higher spend customer. This would impact both day of week usage and seasonality. The Occupancy in 2006 was 80.1, it is anticipated this will fall to 75.8%.

5.21 A comparison of the 5 star market shows an occupancy of anywhere between mid 60’s to low 80’s. With The Belfry’s facility configuration, The Belfry feel that their proposed 75.8% is inline with their target markets, although the tariffs charged will differ from the sample as they are a barrier to occupancy.

5.22 The decrease in occupancy will also be as a result of a change in seasonality, with a decrease in Jan – Apr due to some of the proposed customer type choosing to visit warmer holiday destinations. (Table 5.4)

5.23 The impact to days of the week will favour what are traditionally the peak nights (Tue/Wed/Thu/Fri/Sat) and further reducing the shoulder nights. (Table 5.5)

Average Length of Stay

5.24 A significant change can be seen in the proposal from group based (56.1% v 64.5%) towards more transient guests (43.9% v 35.5%) who would spend longer at the hotel and would visit the local area.

5.25 The proposed development will have a marked change on some of the customer profiles, the hotel will no longer take Stags & Hens, which stay a maximum of one night, but more importantly the product will naturally lend itself to a more luxurious experience, encouraging longer breaks. Combined with a return to longer Business Tourism events will lead to a change from the current 1.3 AVLOS to a proposed 2.58.

Quinn Hotels Business Statement Page 15 6.0 Access

6.1 The most significant impact of the AVLOS change will be the benefit to the local Travel Network, current residential car journeys are estimated to be 73,573 a year, but with an additional 176 bedrooms and an almost doubling of the AVLOS, the number of journeys will drop by 23% to 56,640. (Table 6.1)

6.2 Total car journeys are expected to stay static even with the increase size (432,652 current v 434,114 proposed), this is due to a combination of; a revision of the staff travel plan, a decrease in leisure members & golf rounds, along with the benefit of the change in residential patterns. (Table 6.2)

6.3 The Belfry would introduce a scheme to help increase the number of shared car journeys in to work for staff

6.4 Push and Motor Bike bays would be created to encourage more usage for staff, along with appropriate facilities to support this such as changing rooms and showers

6.5 The hotel has strong ties with local taxi firms and will continue to communicate with them when it anticipates when it will be busy, such as the end of a business event, so that guests can be reassured of transport.

6.6 With more overseas visitors, the hotel would work closely with its customers to provide group transport from key local inbound hubs such as Birmingham International, Tamworth & Coleshill Parkway.

6.7 The Belfry would also look at lobbying for additional stops on some of the local bus routes for the benefit of both customers and staff, an example would be the 115 from Birmingham City Centre to Curdworth, which is only 3 minutes away.

6.8 To ensure that the Hotel is crime preventative, the hotel will be working with the Police Architect. This would involve early stage specifications and final stage Security planning.

6.9 The design of the new building and underground Car Park will comply with the latest DDA regulations and will be a significant improvement over the existing building for both security and safety.

Quinn Hotels Business Statement Page 16 7.0 Employment

7.1 The proposed development will have a number of employment benefits, which include the following: – Employment through Construction – Employment after completion – Indirect employment though local suppliers

7.2 The Hotel’s key employment statistics are as follows: – 61% of employees live in North Warwickshire – 59% of Full Time employees – 67% of Part Time employees – 63% of Seasonal/Casual employees

7.3 This demonstrates the importance of the Belfry in the local area and North Warwickshire, the planned development of the Belfry will ensure the security of the above jobs and the increase through new positions being created and increased casual hours

7.4 In an effort to help parents with children, The Belfry would offer crèche facilities at the hotel, this would be offered to both employees and leisure members.

Quinn Hotels Business Statement Page 17 8.0 Recruitment

8.1 The Belfry has had many challenges recently, the lack of investment has lead to despondency and a number of key personnel have left to take on jobs to further their careers, below are some of the strengths and weaknesses currently faced:

• The Belfry does not currently have the reputation of being an employer of choice which is contributed by the poor working environment • Retention of staff can be a problem at certain levels as some people leave the business to go to competitors with more attractive properties and a better working environment • Employment opportunities are advertised locally to support the employment market in the surrounding area • The Belfry operates a 'promote from within' policy which enhances employees opportunities for career development and advancement • The Belfry offers a diverse range of opportunities and career paths for employees spanning a wide range of employment sectors • The Belfry supports job/careers fairs locally creating awareness and promoting opportunity for employment locally • The Hotel works in conjunction with the Job Centre on their 'Back to work' program which support the reinstatement of people returning to work

Quinn Hotels Business Statement Page 18 9.0 Training

9.1 Training has always been one of the key foundation that provides The Belfry with the intangible spirit that it has and is often referred to by the hotels guests, the team members are given the skill to do their jobs well and the opportunity to develop and progress.

9.2 Due to the diversity of the Belfry's workforce there is scope for employees to change career path or become multi skilled

9.3 The new hotel will require the implementation of new training initiatives to support the transition to a 5 star resort

9.4 Within the industry, there are a number of hotels that are considered to be an aspiration to work at, the Belfry was once considered to be one of these, it no longer is. This has lead to the regions best employees moving out of the area, which is a tragedy considering Birmingham has one of the best Hospitality Colleges in the world. The Belfry would look to work in partnership with the College of Food, Tourism and Creative Studies to develop the best in the industry and keep them in the region.

Quinn Hotels Business Statement Page 19 10.0 Procurement

10.1 Since The Belfry’s departure from De Vere in April 2007 it has: • Started sourcing local suppliers that can demonstrate local links and knowledge and a genuine commitment. • To support local agriculture by trying to source local ingredients where cost and quality will permit, examples are:

Tunnel Brewery Warwickshire ale Ringwood Ice Cream Ice cream from local cream Buzzard Valley Wines Wine grown and produced 7 miles from The Belfry Fowlers Forest Dairies B94 5EL Warwickshire cheese

10.2 Initiatives of current suppliers: • Loves greengrocers, working via a local industry forum, aim to increase the use of local grown Fruit and Vegetable. Working with them to provide the growers with the knowledge and assistance to provide required produce for the future. • Browns of Rugby – The Belfry has recently agreed terms for the supply of fresh meat, and are currently looking to procure local reared meat via The English Beef & Lamb Executive with regional accreditation, plus the supply of pork and chicken from Packington farms (See Appendices 2)

10.3 The Belfry has replaced a number of national suppliers to local ones to reduce the levels of carbon emissions through deliveries. Wherever it has been unable at this stage to source locally products to the quality and price required, it has looked at the reduction of delivery distance.

10.4 The Belfry has also replaced non-consumable products, from a Cheshire delivery based company to one in the West Midland

Quinn Hotels Business Statement Page 20 10.5 Wines and spirits that are current being delivered from London will be sourced from the West Midlands

10.6 The Hotel will also continue to look to replace other suppliers from outside the region as the economics allow, whilst looking to adjust menus to suit local grown and produced products.

Quinn Hotels Business Statement Page 21 11.0 Local Support

11.1 The Belfry currently promotes the following at booking stage, it anticipates that partnerships would be entered into with links from it’s website, along with packaged breaks: – Kingsbury Water Park – Drayton Manor Adventure Park – Tamworth Snowdome – Fazeley Canal – Atherstone Town & Market – Middleton Farm – Stratford-upon-Avon – Warwick Castle

11.2 The Belfry believes that the proposed change in business mix, will lead to longer stays at the resort which will lead to more trips into the local areas.

11.3 Local schools would be invited in to see demonstrations as part of school outings as well as the normal school work experience placements

11.4 A critical market the hotel feels would be North America and the Far East, with both markets using the UK for European Vacations, where they take in historical sites such as Stratford-upon-Avon, Warwick Castle and London etc. The Hotel would expect 2-3 nights are spent at the Belfry whilst the remaining time is spent in London and other areas of interest.

11.5 As highlighted earlier, latest figures available show an increase in UK Tourism for the West Midlands, the hotel believes that the Belfry will be at the forefront of this growth with the proposed and already has a part to play, as the hotels facilities and association with Golf will continue to be a big draw to the area, although out of proportion with The Belfry’s business.

Quinn Hotels Business Statement Page 22 11.6 Through procurement, the hotel would also be creating a Warwickshire Dining experience, where the best local food and beverage produce would be used to create something unique to the area.

11.7 The Belfry’s immediate neighbours would also benefit from the new build, as there would be local crèche facilities as well as a state of the art resort for them to use. Discounts would also be offered to ensure that the hotels neighbours feel more appreciated and that there can be more open dialogue.

11.8 To support the local public sector and business community further, there will be a number of initiatives in place so that they can benefit from the facilities on offer at the resort. These would include discounts to events, specific promotions, favourable business rates etc.

Quinn Hotels Business Statement Page 23 12.0 Summary

12.1 The new build will significantly reduce the foot print of the existing buildings by 8,740 square metres

12.2 The hotel will have an underground car park for 900 cars, this will save 12,000 square metres of ancillary space

12.3 A significant amount of Green Belt will be created through the new building and revised car parking,

12.4 Impact to the local Travel network will be negligible, through initiatives by the hotel and a change in target markets

12.5 The building will be a world leader in terms of the environment, using the latest technologies to reduce carbon emissions

12.6 The economy will benefit as the hotel will increase the level of overseas and outer-region travellers visiting the area & procurement partnerships with the hotel

12.7 Local employment will benefit from increased casual hours and new positions being created

Quinn Hotels Business Statement Page 24 Appendices

Quinn Hotels Business Statement Page 25 Table 3.1 Revenue & Profit - Year to date 2007 v 2006

3,500

3,000

2,500

2,000

1,500

1,000

500

- January February March April May June July August

Rev 2006 Rev 2007 Profit 2006 Profit 2007

Table 3.2 – Turndown 2005 - 2009

Bu si n e ss l o st d u e t o t h e si z e o f t h e Ho t e l

£50,000,000

£45,000,000

£40,000,000

£35,000,000

£30,000,000

£25,000,000

£20,000,000

£15,000,000

£10,000,000

£5,000,000

£0 C - Selected another city TD - Event too large TD - No beds available C - Insufficient Space TD - No Meeting space available

2009 £146,525 £1,478,507

2008 £618,344 £960,129 £227,801 £192,549 £114,835 2007 £9,103,363 £4,769,012 £4,778,873 £672,647 £10,904,717

2006 £8,156,910 £2,938,607 £10,833,350 £860,776 £25,346,343

2005 £3,092,317 £966,937 £7,034,937 £373,302 £9,853,212

Quinn Hotels Business Statement Page 26 Table 3.3 - ADR movement over 2 ½ years

£130.00

£120.00

£110.00

£100.00

£90.00

£80.00

£70.00 Jan Feb M ar Apr M ay Jun Jul Aug Sep Oct Nov Dec

2005 2006 2007 2007 F/C

Table 3.4 - Occupancy movement over 2 ½ years

95.0%

90.0%

85.0%

80.0%

75.0%

70.0%

65.0%

60.0%

55.0%

50.0% Jan Feb M ar Apr M ay Jun Jul Aug Sep Oct Nov Dec

2005 2006 2007 2007 F/C

Quinn Hotels Business Statement Page 27 Table 3.5 - RevPAR movement over 2 ½ years

£120.00

£110.00

£100.00

£90.00

£80.00

£70.00

£60.00

£50.00 Jan Feb M ar Apr M ay Jun Jul Aug Sep Oct Nov Dec

2005 2006 2007 2007 F/C

Quinn Hotels Business Statement Page 28

Table 5.1 – Distribution by Channel 2006

Channel Room Nights Room Revenue ADR AV LOS Tot Rev Per Mix Stay Direct/ 88,348 £9,742,975 £110.28 1.29 £468.98 92.5% Agent GDS 572 £54,726 £95.84 1.17 £153.62 0.6%

Website 3,313 £311,755 £94.10 1.30 £210.94 3.5% CRS 3,235 £295,481 £91.34 1.38 £226.18 3.4% Total 95,468 £10,404,937 £108.99 1.30 £450.24 100%

Table 5.2 – GDS Market Share 2005 - 2007

Distribution Channels Analysis 2005- 07 (Inc VAT)

The Belfry’s Total Room Nights From All GDS's May 2005 to April 2007 Figure 5.8

The Belfry’s Sources of Room Nights By GDS Birmingham’s Sources of Room Nights By GDS May 2005 to April 2007 May 2005 to April 2007

Quinn Hotels Business Statement Page 29

Table 5.3 – Average Length of Stay & Business Mix Analysis

Proposed Rooms Sold Business Mix Av LOS 2006 Rooms Sold Business Mix Av LOS

Flexible Public Rate 21,000 15.2% 2.5 Flexible Public Rate 11,162 11.8% 1.3 Agency Corporate Rate 400 0.3% 2.0 Agency Corporate Rate 32 0.0% 1.3 Negotiated Corporate Negotiated Corporate Rate 800 0.6% 2.0 Rate 611 0.6% 1.3 Discount 2,500 1.8% 2.5 Discount 1,995 2.1% 1.1 FIT 1000 0.7% 2.6 FIT 460 0.5% 1.3 Golf Breaks 15,000 10.8% 2.1 Golf Breaks 7,136 7.5% 1.3 Leisure Breaks 11,000 7.9% 2.3 Leisure Breaks 5,400 5.7% 1.4 Promotion 9,000 6.5% 2.2 Promotion 5,985 6.3% 1.2 Staff Rate 100 0.1% 1.2 Staff Rate 834 0.9% 1.2 Transient Total 60,800 43.9% Transient Total 33,615 35.5% Banqueting 8,000 5.8% 1.6 Banqueting 4,930 5.2% 1.3 Meeting 55,000 39.7% 3.2 Meeting 44,860 47.4% 1.3 Corporate Golf 9,000 6.5% 1.7 Corporate Golf 7,276 7.7% 1.2 Weddings 750 0.5% 1.5 Weddings 382 0.4% 1.1 Corporate Group 1500 1.1% 1.8 Corporate Group 325 0.3% 1.0 Exhibition 0 0.0% 1.7 Exhibition 29 0.0% 1.0 Sports Teams 1,500 1.1% 3.0 Sports Teams 1,328 1.4% 2.6 Leisure Golf 1,650 1.2% 2.2 Leisure Golf 1,369 1.4% 1.3 Leisure Group 200 0.1% 2.2 Leisure Group 574 0.6% 1.3 Group Total 77,600 56.1% Group Total 61,073 64.5%

TOTAL 138,400 100.0% 2.58 TOTAL 94,688 100.0% 1.30 Occupancy 75.8% Occupancy 80.17%

Table 5.4

Occu p an cy % b y Mo n t h

100

90

80

70

60

50

40

30

20

10

0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2005 76.1 78.4 73 84.6 78.7 82.2 82.5 77.3 87.7 80.4 83 63.9 2006 72.3 79.3 75.4 73 74 88.3 83.7 77.8 90.3 89.6 85 72.7

Proposed 62 71 77 71 73 86 81 64 87 86 83 70

Quinn Hotels Business Statement Page 30 Table 5.5

DOW Occu p an cy %

100

90

80

70

60

50

40

30

20

10

0 Mon Tue Wed Thu Fri Sat Sun

2005 73.4 83.1 89.9 85.9 79.5 92.1 56.5 2006 76.9 79.9 83.9 83.5 81.2 88 60

Proposed 71 81 83 78 80 86 52

Quinn Hotels Business Statement Page 31 Table 6.1

Re si d e n t i al Car Jo u r n e ys

35000

30000

25000

20000

15000

10000

5000

0 f f t c e e s s e l s p s l p T g n i n t t t I m l n k k o g u o u n o a a o a F s m a a i i b d u i i r n o o t G t G R t R a e e i e r i u o r r o e t r r e o f d P c u e b e e G G e p a B B f u i t T t r i s d t o r m i a e t q a h a f e e u e l a e t e l T s o o r r t o D n x r t r t s S b R r o W i o a i C o a E r a g s u u P r e G B p x e p s o s R s y L i i r o r e e p N l c e e o p o n S F L n L i r C C e s o g u C B A

Journeys 2006 Journeys Proposed

Table 6.2

Ove r al l Re so r t Car Jo u r n e ys

140,000

120,000

100,000

80,000

60,000

40,000

20,000

- Business Tourism Golfers Lesiure Mem bers Residential - Less Golf QDBM Staff PGA

Current 32,676 56,324 121,333 61,895 13,889 126,454 20,082 Proposed 65,352 52,941 95,333 44,998 13,889 131,692 29,909

Quinn Hotels Business Statement Page 32 Appendix 1

Quinn Hotels Business Statement Page 33 Competition Matrix

Celtic Manor The Grove K Club Gleneagles Hanbury Manor Turnbury

330 + 32 suites + 70 in Manor 227 Rooms 69 Rooms 232 Rooms 19 Suites 161 Rooms 130 Type Q u antity Type Q u antity Type Q u antity Type Q u antity Type Q u antity Type Quantity Suites 32 Superior x 78 Suites 15 Classic 16 Standard 32 Classic 93 ocean view Standards 403 Deluxe King x 57 Deluxe Rooms 54 Sovereign 94 Manor House 16 Spa view 15 Superiors 89 Deluxe Twin x 36 Private 2 roomed State Rooms 121 Executive 5 Deluxe 14 Sup twins 78 1 Bedroom Suite x 26 Apartments 22 Suites 19 Prestige 16 Suites 8 Junior Suites 7 Lodges 8X 6 bedroom Senior Suites 5 Lodges 4X 8 bedroom Cottages 9X 2 bedroom

Restaurants/Bars Restaurants/Bars . Restaurants/Bars Restaurants/Bars Restaurants/Bars • Ownes Fine Dining Collette's • The Dormy Clubhouse • Zodiac – Formal fine • Turnbury Restaurant, Fine • Merlins Bar The Glass House •The Strathearn dining dining The Stables –Sports Bar • Andrew Fairlie • Oak Grill, Breakfast room • Stagionni –new Italian, opened • The Patio •The Bar 2007 • The Lodge •The Club • Tapi Tori – Clubhouse, sports • The Olive Tree Brasserie •The Tryst food •The Halfway House

Meetings & Events - Meetings & Events Meetings & Events Meetings & Events Meetings & Events Launch Autumn 2006 Tower Room – 25 board The Glen Suite 360 Thundridge 120 Caledonia 400 Meeting Rooms 23 See Appendix, too John Jefferson Smurfit –50 dinner The Ballroom 360 Garden Court Lounge 100 The Arran Suite 100 extensive to list here Amber – 400 Th Yeats Room –predinner drinks for Glendevon 120 Poles Hall 120 The Kintyre 50 JJS Room Barony 80 Hawthorn 60 Arnold Palmer Room –160 dinner Orchil 20 Summer House 50 Legacy Suite 300 Dinner Terrace 30 Magnolia 40 Ruthven 30 Boardroom 20 Conservatory – 40 Drawing Rooms X 2 32 capacity Fitness & Beauty Fitness & Beauty, Sequoia 12 Spa treatment rooms Fitness & Beauty Fitness & Beauty Fitness & Beauty The Forum Spa, 12 Fitness Center / Hammam I pool –outdoor hot tub Fitness Centre, 3 pools Spa Health Sap 8 Rooms no The Spa –2 pools, Treatment rooms, 2 pools Massage Leisure Suites. Toning studio Hairdressing relaxation GDS: Galileo GDS: LW GDS - LH GDS - LH GDS: GDS:

Day Delegate Rate Day Delegate Rate 2007: Day Delegate Rate 2006: Day Delegate Rate 2006: Day Delegate Rate Day Delegate Rate 2006: 2007 £excl. VAT

Quinn Hotels Business Statement Page 34 The Belfry SWOT Analysis

Hotel Strengths Hotel Weakness

Easily accessible Bedrooms in need of refurbishment Unquestionable golfing heritage, 4 time host to Ryder Cup Ballrooms and public areas in need of refurbishment PGA National Golf Academy, specialising in custom fit Lack of wow factor on arrival Good match of bedroom capacity and event space No dedicated welcome or uniqueness around the iconic Complimentary car parking Brabazon course – no differentiation High Speed internet access in all bedrooms No guest loyalty programme All ballrooms offer natural daylight Poor signage internally & externally WIFI access in all meeting rooms Distance from the driving range to first tee of the Stunning views most rooms courses Consistently poor GSS (Guest Satisfaction Survey) product rating Opportunities Threats

Part of the Quinn portfolio of Internationally renowned Customers perception and experience during extensive companies redevelopment plans Planned re- furbishment of public areas Golfers perception and experience during extensive QDBM – televised European Tour Event returns yoy ongoing redevelopment of the courses. Opportunity to restructure the resort creating 5 star Loss of clientele during rebuild experience No driving range facility, loss of income and the knock Golf Courses continue to evolve on effect on corporate days Raise the profile of The PGA Course Extensive refurbishment to the Metropole Hotel and a Increased investment in GDS marketing new executive lounge/floor Substantial rate increases by 5 Star Hotels encouraging Forest of Arden due to undergo a full refurbishment corporate clients to review travel policies Lack of investment Closer CRM by on the road Sales people following the move away from De Vere Lots of local attractions, close by and easily accessible

Quinn Hotels Business Statement Page 35

The Grove SWOT Analysis

Hotel Strengths Hotel Weakness

Location – 30 minutes from Heathrow and 45 minutes from High prices Central London, 5 minutes off the M25 New entrant, therefore unproven to many corporates Only resort hotel in its location.40 mins from London Perceived to be inflexible Venue for World Golf Championships in 2006 Variable reports on facilities and service, largely the All bedrooms equipped with 42 inch plasma TV and inconsistency of both aspirational gadgets, exclusive bathroom fittings and Constantly spoken about with properties already very sumptuous fabrics established within the 5 Star market, thus expectations Voted AA hotel of the year 2005 and best Rated joint 1st are very high golfing venue in Europe by Peugeot Golf Guide 2004/05 One course, and limited practice facilities Top 5 contemporary country house hotel in UK Top 100 golf course in the UK Best UK Spa 2005 (Financial Times) Website

Opportunities Threats

Fantastic designers giving quirky and innovative edge to All Room rates include room only starting from £282 and traditional Hotel offerings, including a 17,000sq ft sand, raising to £900 per night traditional beach huts, international standard beach Getting there can be haphazard on the M25 which is the volleyball court, including beach concierges. main feeder road and subject to frequent daily delays Very family friendly, offering OFSTED rated crèche, Inflexibility of pricing and packages continues to frustrate welcome packs for families, inclusive meal deals and entry to the corporate market. other attractions round the area Creative programmes to design your own meeting room layout High speed internet and Safe in room/lap top friendly Car parking 500 free spaces 3 restaurants – from bar food to A la carte to British, Asian and Mediterranean dishes

Quinn Hotels Business Statement Page 36

Gleneagles SWOT Analysis

Hotel Strengths Hotel Weakness 2014 Ryder Cup venue Location 3 Championship courses – 2 dating back to 1919 pre Hotel Perceived stuffiness, it is very formal opening. James Braid is course designer. Jack Nicklaus Formal dress code designed the 3rd course – PGA Centenary. A 9 hole course Location of some facilities is very remote from the Hotel caters for novices Driving range is not under cover and is small Currently doubling space in spa to yield 20 treatment They are primarily a leisure resort, with many families, rooms and refurbishing leisure to incorporate a deli style could be off putting to the corporate client leisure food offering No price differentiation on the courses, they are all £100 Ongoing bedroom refurbishment to luxury contemporary per green fee design Taking 40 smaller bedrooms out of stock to yield a 10 highly exclusive suites International reputation for Golf, Equestrian sports, shooting, fishing, falconry, tennis and motorised Michelin starred Restaurant 8 exclusive shops retailing luxury goods 7/7 Renowned for exceptional service and personalised welcome for guests Daily resort tour offered to all guests to ensure they maximise their time at the property The Club offers 3 pools, including an outdoor hot pool facility Created One bedrooms Suites on the 4th floor, the Whiskey Suites Opportunities Threats New Spa and Leisure 07/08 New Bedroom and Suite offering Not accessible to all – geographically or pricing Ryder Cup Availability of cost effective packages, very limited at the International appeal through being 5 red diamonds bottom end. Corporates would use it as a high end incentive destination Corporate buyers would perceive it to be too exclusive and expensive to utilise

Quinn Hotels Business Statement Page 37

Turnberry SWOT Analysis

Hotel Strengths Hotel Weakness

Its name is synonymous with Golf, internationally and Very poor and old fashioned collateral, with a very nationally corporate template, not in sync with the atmosphere of Voted Best Resort in Europe by Conde Nast magazine the resort 5 red diamond resort, owned by an International brand – The Kintyre course is just turning 5 years old, it is new Westin and therefore will not be rated for it excellence for the 2 of the most famous golf links in the World, host to The next 5 years Open 3 times. The Ailsa Golf course is ranked amongst Location the top twenty golf courses in the World and the top three in the UK Colin Montgomery Links Golf Academy

Opportunities Threats It is expensive for the Corporate market and may be The Spa at Turnberry, undergoing a massive refurbishment viewed by them as being too expensive and wasteful of their which will yield it 20 treatment rooms, 3 pools and expansive budget Relaxation areas Location – it is exceptionally difficult to get to Expansive family orientated programmes for families, including a Buddy for a Day – a trained NNEB Nanny, capable of taking children horse riding, owl flying etc, for between 6 to 8 hrs Bedrooms – ongoing refurbishment, with 8 exclusive suites They will always be on the British Open Rota, between 5 to 10 years – next one due 2009.

Quinn Hotels Business Statement Page 38

The K Club SWOT Analysis

Hotel Strengths Hotel Weakness

Ryder Cup venue 2006 Isolated location, long distance from the airport Host of the Irish Open Very poor transport links, taxis very expensive 2 Championship golf courses Only 69 bedrooms, with a banqueting room for 300, Exclusivity – 5 Red Star Hotel, operating on a “staying at there is a regular mismatch of facility leading to home” experience, old fashioned keys, no room numbers, frustrations in the corporate market stylish and warm, with very professional service The Spa is located a long walk from the Hotel and is Not formal, relaxed atmosphere not attached to the property, it necessitates walking Can be bought exclusively outside. Exclusive Spa, individual saunas and steam rooms Lack of things to do around the area, nothing else and no other attractions nearby

Opportunities Threats

Location, especially for corporates with strong Exploitation of the Ryder Cup presence last year environment policies, flying to the K Club and the 1 hour Fantastic spa, which is currently undergoing a drive from the Airport will not be an option refurbishment and expansion programme When dealing with clients from the UK, there is a currency Privately own a tranche of the River Liffey for corporate conversion issue and leisure guest use. The land on which the K Club sits is privately owned, the scope for expansion of the property is vast 22 Apartments, which can be hired privately with a maximum occupancy of 4 guests in each.

Quinn Hotels Business Statement Page 39

Hanbury Manor SWOT Analysis

Hotel Strengths Hotel Weakness

Proximity to London Debenture for Golf & Leisure, which restricts business Set in 200 acres strategy Complimentary Car parking Orchard wing is offset from the main building, with no Aligned to the global Marriott Brand covered link Plentiful choice of outdoor activities, motorised and non All reservations and meetings are taken in a call center motorised Listed Building and a lack of space to develop the site Marriott rewards program further Main Part of the hotel is listed and has a lot of character, which is a big draw for the overseas market

Opportunities Threats

Buy back the Debenture, will allow them to impact more High turn over of Director of Sales in recent years has lead Corporate Golf days and target more weekend leisure to consistency of communication and direction business The locality of The Grove means they are continuously Owned privately by a Sudi business man, who has competing for the same business which impacts price promised huge investment Refurbishment of the hotel has been in the pipeline for 2 If they can get consistent account management in place, years now, which has a negative impact on staff morel and the London market could drive a lot more business, customer opinion especially in the current strong market. New GM has just started (May ’07), position vacant for 5 months

Quinn Hotels Business Statement Page 40 Celtic Manor SWOT Analysis

Hotel Strengths Hotel Weakness

Well established golfing and meeting resort, 5 star, with Location, it is difficult to get to consistent service When the meeting rooms are not in use, the whole Host to Welsh Open resort is empty due to no passing trade Ryder Cup 2010 External façade is not luxurious or attractive Montgomery Course opening this year Not got a strong or favourable reputation for Golf Good facility match – 410 available rooms and 40 The short game practice facility is in need of meeting rooms improvement They have recruited staff with excellent golfing experience.

Opportunities Threats

They buy high profile televised events Location They have vast capacity to host large and prestigious events Perceived the play thing of a rich man, the golfing heritage Ryder Cup and Welsh Open has been bought rather than earned on the courses. They appear to have a massive marketing budget Corporates find the sales process laborious and inflexible Bedrooms are in need of refurbishment to retain the 5star status, quality of linen poor, in room amenities were very low quality and corporate.

Quinn Hotels Business Statement Page 41 Appendix 2

Quinn Hotels Business Statement Page 42 Current & Potential Suppliers (see Fig 9.1)

1. Butchers – Althams LA3 3AY specialty items only ref. current m enus – Fairfax DE24 8SW current supplier looking to replace – Browns Foods Rugby preferred supplier negotiating contract 2. Greengrocers/Dairies – Freshdirect OX26 4SW current supplier looking to replace – Inter- Fruit B5 6UN back up supplier – Loves B24 0QY preferred supplier negotiating contract 3. Grocers Selected local suppliers currently being – 3663 Coventry preferred supplier agreed contract approached 4. Frozen Foods • Tunnel Brewery CV10 9PQ – 3663 Coventry preferred supplier agreed contract • Ringwood Ice Cream CV23 0QP – Delice de France specialty items only ref. current m enus • Buzzard Valley Wines B78 3EQ 5. Non- Consumables & guest supplies • Fowlers Forest Dairies B94 5EL – Alliance Disposable CW2 8UY current supplier looking to replace • Meats working with Brown foods to find local m eats for fine dinning – 3663 Coventry preferred supplier agreed contract • Fish working with Woodward’s Foodservice to find local fish and 6. Wines and Spirits specialty foods for fine dinning – Bibendum NW1 8UR current supplier looking to replace – Matthew Clark B6 7AX preferred supplier negotiating contract 7. Beers and Minerals – Coors (delivered out of Hams Halls) current supplier looking to replace – InBev (delivered out of Hams Halls) preferred supplier negotiating contract 8. Fish – M&J B66 1AU current supplier – Woodward’s Foodservice B’Ham negotiating back- up supply 9. Cheese – H&B WR10 2JN current supplier looking to find local replacem ent 10. Bread – Lewis and Sons B’ham – Tudor France Sutton Coldfield Back up supplier – Gusto Express specialty breads and pastries

Quinn Hotels Business Statement Page 43

5

1

4

8

7 2/6/8

10 3/4/5 1

9

Quinn Hotels Business Statement Page 44