Worth the wait

Julien Barbotin-Larrieu, president, H.E.S.A.: Only the guests will decide if it is the best in Poland. One future rival will be the Four Seasons, in a new building behind the Marriott, when it opens in around 3–4 years. A few small luxury brands will also appear. But it’s difficult, actually, to regard them all as true competitors. The Prudential could be our competition, but I’ve actually got no idea when it will be opening. It’s owned by the Likus family, who also have a nice hotel in Kraków – so let’s see what they can do in Warsaw. Nobody has seen any visualisations yet, but I think it’s going to be one of our main rivals. The only thing they will have that might be superior to ours is the view. But for now, the competition is the Bristol and the Sofitel Victoria. We have recruited more staff, adding a butler service. The Bristol itself is hiring a butler right now, as it wants to be on the same level as us.

Who chose who – did Raffles choose the Europejski or did Europejski choose Raffles?

When the building reverted to its previous ownership, they asked a few brands to bid for the hotel. Raffles turned out to be the best from a commercial point of view and its brand image. This is a building that deserves an iconic brand.

Who were the others?

I don’t know – but for sure there were at least two big names.

Are you planning any another openings?

No. The company was set up as a one-off project.

Why?

Because there is only one Europejski. We don’t want to be developers. Our main target right now is to open the hotel, complete the office and the retail space, make sure the hotel operates properly, and then, maybe in five or ten years, we will see.

When the project breaks even?

This is not an investment that is meant to be sold. We are not looking at this enterprise with a five, ten, or even twenty-year perspective. We are looking at it with a 100-year perspective. We are not thinking of it in breaking even but in emotional terms. Yes, initially we looked at the numbers, but the most important thing was to guarantee that the hotel becomes iconic of Warsaw and iconic of Poland. In terms of finance, of course, it’s not a cheap hotel. We are lucky that we have developed this hotel over the last few years, because if we did it today, it could be 20–40 pct more expensive to do so. Salaries have grown exponentially, the cost of construction has risen exorbitantly, and there is a shortage of labour.

How much above the initial budget have you gone?

Well, let’s put it this way: there’s been an ocean of emotion over the budget.

Why has the opening been postponed several times?

It’s not that far behind schedule – only by a few months. In Dubai the Kempinski hotel still has an “opening soon” billboard with 2016 on it… But yes, initially we had even been talking about a September 2017 opening. But it’s a complicated project – in an old building. There are so many contractors and there is no general contractor. Coordination, accessibility, making sure the hotel has the proper finishing... all of this is difficult. The details matter for such a building, at such a luxury level. Getting everything together has taken longer than expected. That’s why we had to put the opening back from January to March and then to May, to make sure that when we opened it, it was in the best shape possible. Being six or eight months behind doesn’t matter. We can only have one opening.

Why did you decide upon a mixed-use project, rather than just a hotel?

Having just a hotel gives you a variable income, but office and retail provide a fixed income. To be able to maintain the structure as long as possible you have to have a fixed income. And it also diversifies the business.

Who are the tenants?

The offices are 100 pct leased, but we can’t reveal to whom. We are looking to commercialise the retail in a year’s time. Out of the big brands we are hoping to have in the hotel, two still have to commit themselves. These are big luxury brands and the process takes a long time. In June we will be signing a contract with one of the most exclusive brands on the market – and it has taken us months to get them on board. Not due to any lack of competence, but because it just takes so long with the most exclusive brands. The retail will be 100 pct open by the end of next year. Much also depends on the authorities – the historic building conservation office attends to every inch of the retail space.

What led you, personally, to take on the Europejski?

When my wife and I moved to Poland few years ago, it just so happened that our goal was to open a restaurant and an art gallery. In the meantime, the families who owned the hotel had this project in the pipeline and they needed it to be supervised more closely. I started working on it as a consultant and after few months they entrusted me with managing the entire project. My background was in management and finance. I had no clue what I was getting into, but we are all happy about the result.