It is the hottest day of the year, with the temperature touching 30C, yet as I
arrive for lunch at the Surrey farm owned by Sir Rocco Forte, the veteran
hotelier is just returning from a lung-bursting 30-mile cycle ride,
preceeded by a 2km swim. Thankfully, the third leg of today’s triathlon
training programme is a round of golf, rather than a run.
But before we head off to do battle at The Wisley Golf Club, there is the
important matter of refuelling after the morning’s gruelling regime. Instead
of the quick snack lunch I was expecting, I am invited to join the Forte
family and assorted friends for a glass of champagne followed by slices of
pizza (cooked in an authentic Italian pizza oven), barbecued steaks and
sausages and strawberries with homemade ice-cream.
Two hours later and Sir Rocco suddenly realises it is five minutes until our
tee reservation. He gulps down an espresso, throws his clubs into the boot
of his Ferrari and speeds off, leaving me to try to keep up in my humble VW
Golf as he hurtles through the country lanes near his home in Ripley. Five
minutes later, caddies in tow, we make it on to the first tee with moments
to spare.
As I watch the superfit hotelier tee up his ball I have to remind myself that
he is 64 years old. He has the physique of a man half his age and, as he
smashes the ball into the distance (albeit into water) with a long and
powerful swing, it is suddenly obvious to me why, in triathlon circles, he
is on the fringes of the top ten in the world in his age group.
Although triathlon is his main sport these days, the golf course is an
appropriate place to interview Sir Rocco as his company, the Rocco Forte
Collection, is about to launch its first luxury golf resort, a €160 million
(£135 million) project on an idyllic stretch of Sicilian coastline. He is
clearly revelling in the imminent completion of the 203-room Verdura Golf &
Spa Resort, although it has taken all his powers of endurance to bring the
project to fruition.
It is seven years since he began the project and much of the time since has
been devoted to navigating the nuances of Italian property ownership and
planning regulations. “Although the land had been zoned for tourist
development, it had 72 separate owners, so it was quite a business,” he
says. Seemingly undaunted, he plans to embark on a second phase of
development, once the property market improves, by building 65 villas around
the course. “It could be a very lucrative project.”
Despite his enthusiasm for the Verdura resort, in economic terms it could not
be opening at a worse time. The same goes for The Augustine Hotel, a
leasehold property in Prague that opened in May at a low point in the
fortunes of the Czech city. “It has opened at the worst possible point,” he
says. “In the last 12 months Prague has become a very difficult market and a
lot of new stock has come on stream. But ours is by far the best hotel in
the city. It’s a rather a unique property. I think it’s the most charming
hotel we have.”
Sir Rocco estimates that, for the period from September to the end of April,
the group as a whole suffered a decline in like-for-like revenues of about
20 per cent, ranging from a comparatively robust 5 per cent drop at its
three British hotels, which have benefited from the weak pound, to a 40 per
cent slump in Russia. “Until August everything was going quite well and we
were up 6 to 7 per cent — then, suddenly, bang! Worst hit is St Petersburg,
which is dependent on Russian and international tourism, while Florence is
also a very bad market. It has very little commercial business at the luxury
level and is dependent on the US market, which hasn’t really come back.”
He says that the banking meltdown hit the company hard, as the financial
sector normally accounts for a big slice of its business. “Lehman Brothers
were doing £1 million of business a year across the group and Merrill Lynch
were doing £750,000. Most of that’s gone.”
Sir Rocco says that the biggest issue is the lack of visibility on forward
bookings, which in turn leads to discounting. “We’re seeing very short lead
times on bookings. It’s quite difficult to forecast more than a month
forward, which means it’s more difficult to force the rate. There’s a
tendency to overdo the drop in rate and everybody cuts each other’s throat
as they post lower rates on the internet and others follow suit.”
It is clear that, for a hotelier of the old school, the impact of the internet
is a mixed blessing. “I must admit, I don’t like this new system now where,
effectively, you don’t have a tariff — the rate changes every day. But it’s
very difficult to go against the trend.” Analysts have started to question
whether some cities will ever recover sufficiently to support five-star
hotels, and Sir Rocco admits that it is an issue. “There are some locations
where it’s difficult to get decent room rates and the market just isn’t
there. If you can’t get the room rate, then it’s difficult to deliver the
service and you jeopardise your standards and your name. But I think it’s
very early days to start looking at withdrawing. There’s no area we
particularly want to come out of at the moment.”
My decision to turn the conversation from polite chit-chat to the horrors of
current trading rebounds on me in the context of our golf match. Suddenly,
Sir Rocco, who these days plays off an 18-handicap but in his pomp was off
nine, starts smacking the ball with renewed vigour, as though taking out his
frustrations on his small white sphere, and in a flash my three-hole lead
has been wiped out. On one hole, a par five, he unleashes a drive that
pitches straight into a bunker 275 yards from the tee. “That would have gone
more than 300 yards if it had landed on the fairway,” he smiles.
Not that the financial crisis has stopped him looking for expansion
opportunities. On the contrary, he continues to seek new properties,
although, unlike the Verdura resort, he will not be investing his company’s
own money but will be running the hotels under management contracts. He has
four such hotels in the pipeline over the next two years, in Abu Dhabi,
Jeddah, Marrakech and Cairo, which, with Sicily, will take the number of
hotels in the group to 17. He says that, given the group’s £380 million of
debt, half of it in a joint venture with HBOS, management contracts are the
only way it can expand. “We’ve got limited capital. I’ve leveraged it as far
as I can — too much, in a way. So unless I bring in fresh capital directly
into the main company I can’t continue expanding. But, anyway, it makes
sense, because we’re leveraging the investment we’ve made in creating a
brand and an infrastructure.”
He admits that, in the wake of HBOS’s financial woes, the company had found
itself in a difficult position. However, after the bank’s takeover by Lloyds
Banking Group, any fears that the joint venture might be wound up had
dissipated. “They don’t want to cut off their nose to spite their face, so
they’re taking a sensible view of things.”
However, he concedes that the joint venture, which holds seven hotels,
including Brown’s, in London, and The Lowry, in Manchester, is “no longer a
core business for them”, adding: “I think that over a sensible period of
time they will want to move out [of the joint venture], so we’ve got to
replace them. I would like a long-term partner who’s interested in owning
hotel property on a long-term basis, with us managing them, a bit like
Prince Alwaleed did for Four Seasons Hotels.”
A new partner would allow him to restart in earnest the search for new hotels
in key cities including Paris, Madrid, New York, Moscow, Milan and
Amsterdam. “I am looking, but it’s been difficult because prices have been
too high. I think by the autumn things will have moved on and there could be
some opportunities.”
Despite the trading slump, Sir Rocco insists that the company’s finances are
strong. Turnover in the year to the end of April rose from £150 million to
£165 million and he expects it to reach £195 million this year on the back
of the Prague and Sicily openings, although much will depend on exchange
rates. The bottom line will be helped by a recent £7 million cost-cutting
exercise involving the loss of eight out of thirty head office jobs.
So is this is the worst recession he has experienced? He pauses long enough to
lash another golf ball into the distance. “In some ways you don’t get the
feeling of a recession. I remember the 1974 recession — that was really
grim, with the three-day week, electricity cuts and empty restaurants. The
1992 recession was very long in terms of the hotel industry and, actually,
was the cause of the takeover, ultimately.”
Aha. “The takeover”. I finally get my chance to talk about the hostile
takeover of the Forte hotel and catering empire by Granada in 1996. Although
the bid gave him the money to start the Rocco Forte Collection, he is
dismissive of the benefits to Granada. “They didn’t make any money out of
it. The only thing it gained them was a further lease of life for a bit.
They had to take something over to keep things going, keep the share price
going.” Although he is still bitter over the way the company built by his
late father, Lord Forte of Ripley, was dismantled, most people who know Sir
Rocco believe that he is much happier running his own business rather than
heading his father’s and, inevitably, suffering by comparison with the
hospitality industry’s most successful entrepreneur.
He sidesteps the question. “At Forte, I had a different role to the one I have
now. But I get a lot of satisfaction from what I’m doing now. I really like
being more hands-on with operations, getting into the hotels more and having
contact with the staff in a way that was impossible to do in the old
business. Creating something that wasn’t there before is rather satisfying.”
He claims that he never regarded stepping into his legendary father’s shoes at
the old Forte was a burden, insisting that when Granada pounced — famously
when Sir Rocco was out shooting — he was on the point of transforming the
company and taking it into a new era of his own creation. He says that he
always enjoyed a “wonderful relationship” with his father and that the only
tension came when it was time for him to step down.
Sir Rocco says that he also harbours no bitterness at being persuaded by his
father to abandon a promising career as a child actor. He played a leading
role in a TV series in which a youthful Sir Michael Caine had a non-speaking
part, but despite many offers of follow-up roles, he accepted that his lot
was to join the family business.
I ask him whether his three children show any sign of wanting to follow the
family tradition and it transpires that, without any coercion from him, his
eldest daughter, Lydia, 22, and his son, Charles, 17, are showing signs of
interest in hospitality as a career. “My eldest daughter has told other
people she’d like to come into the business but she’s never told me
directly.”
After winning our golf match at the final hole, Sir Rocco, who in his early
20s was on the fringes of the British fencing team, looks far fresher than
anyone who has spent most of the day swimming, cycling and playing golf has
a right to look — particularly at 64. While many people his age would be
looking forward to retirement, that is the last thing on his mind.
Over a cold drink on the club terrace, he dismisses the idea out of hand.
“Retire? No, not all, far from it actually, the opposite. The day I retire
I’ll be dead. I’ve got plenty of energy still, plenty of enthusiasm and
interest. I enjoy it. So why stop? I’m relatively young for my age, I’m fit,
so there’s no reason for me not to continue. And if my children are
interested I’ll have to keep going for quite a long time. I’d never stop
altogether.”
At that, the veteran hotelier leaps up, bids me farewell, takes the wheel of
his Ferrari and roars off into the distance. For all I know, he may be
heading back to complete the running part of his normal triathlon training.
He’s certainly got the energy for it.
Sir Rocco Forte
Age 64
Education Downside public school, then Pembroke College, Oxford,
(modern languages). Then trained to become a chartered accountant
Career
1969 Joined Forte Group run by his father the late Lord Forte
1982 Took over from his father as chief executive
1992 Added the role of chairman
1995 Knighted for services to tourism
1996 Leaves after acquisition of Forte by Granada and sets up Rocco
Forte Hotels, which subsequently was rebranded The Rocco Forte Collection
Other business interests Owns 50 per cent stake in The Catholic
Herald
Personal life Married with three children. He and his wife have homes
in London and Ripley in Surrey
Interests Triathlons and golf
Case study: The Augustine
Since he launched his own company 13 years ago, Sir Rocco Forte has restored
the fortunes of a host of once-famous grande dame hotels. The Rocco
Forte Collection, which is about to open its thirteenth hotel in Sicily, its
first resort, includes such names as The Balmoral in Edinburgh, the Amigo in
Brussels and the Astoria in St Petersburg.
But he believes that his most recent addition, The Augustine in Prague, is
“the most charming”. The 101-room hotel is set in five buildings dating from
the 13th to 15th centuries around the cloistered terraces and vaults of St
Thomas’s monastery. The €65 million conversion project includes an interior
design that blends the old and the new, including many accessories inspired
by 1930s Czech cubist movement.
Yet with half a dozen monks still inhabiting part of the site, it is the
monastic feel that holds sway. The hotel has a cocktail bar that has been
dubbed Tom’s Bar after the monastery’s patron saint. The separate Brewery
Bar, situated in the cellar of the former St Thomas brewery, is where the
monks once fermented their namesake beer.
Sir Rocco has resurrected brewing on the site, although he says that the
traditional stout was a little strong and had to be adapted for modern
tastes. It has even found favour with the resident monks. “I did a tour with
two monks and I took them to the bar where we drew a pint. They rather
enjoyed it.”
