A unique Waterfront development

Brian Mizzi of the Mizzi Organisation speaks to David Linsday about the organisation’s tourism-related activities, which include the dazzling Waterfront Hotel and one of Malta’s largest English language schools, and how it has found success by continually responding to the demands of the market

How did the Organisation start off in the tourism sector and has it witnessed the sector change over the years?

Our involvement in tourism began some 25 years ago at the site of the Waterfront Hotel, which was previously a block of apartments. We had identified a period when tourism was beginning to take off in Malta and there was a great demand for self-catering apartments.

We capitalised on the market demand and took a decision to apply a self-catering emphasis to the site, which worked well. As the market developed over the years, however, clientele began looking for more facilities than the self-catering apartment could provide.

At that time we were running a substantial incoming operation encompassing tourist needs such as car hire and excursions. We had also developed a self-catering operation, namely St Paul’s Court in St Paul’s Bay, which was followed by a purpose-built self-catering development in Mellieha.

Since then the market has changed in many respects. The handling aspect of tour operation became more competitive and the tour operators themselves started setting up their own operations, as opposed to going through incoming agents.

These developments, coupled with certain strategies we were implementing, saw us changing direction and begin focussing on hotels.

The first investment along these new lines presented itself through taking up a quarter shareholding in the Comino Hotel. We then, together with the Alf Mizzi Group, purchased the remaining lease that Thompson had held on the Mellieha Bay Hotel and took over the hotel’s management.

We then embarked on building the Waterfront Hotel, which began with demolishing the original flats and the Delta Home Centre and building it up from scratch. The development was planned using whatever expertise was needed to achieve the end product, which we are very proud of and is one that has proved itself as a worthy investment.

Coupled with that, we started one of Malta’s first English language schools, the Institute of English Language Studies, in partnership with a German operator. The school still exists today and is one of the largest on the Islands. We had identified a niche market there, we developed it and today language studies accounts for a good part of tourism on the Islands.

We weathered the change and adapted well and we are always looking for additional opportunities in the tourism and leisure field. The Pizza Express franchise, which we operate but run as a separate operation from the hotel, is a case in point. When we were building the hotel we identified the need for a leisure dining outlet and we chose Pizza Express to fill the need. This was the first outlet that we have opened, but we will observe the market to gauge how it responds in order to take the idea further.

There has been a lot of talk about the last MHRA survey, which cited reduced occupancy rates toward the end of last year. How has The Waterfront fared over that time span?

A hotel is measured against two benchmarks – its occupancy and its room rate.

In terms of occupancy, we have outperformed the market so far and we closed the year ahead of our targets, over the 80 per cent mark.

So far this year we have achieved some very good results and, looking ahead, I believe it is going to be a very positive year for us. This is mainly due to our decision to take on board a very large group of tour operators, which accordingly gave us a far broader supply of clientele, making us no longer dependent on any one single operator.

We are performing well notwithstanding certain market conditions.

The reason is, of course, that tour operators from other countries have taken up the slack created by the decline in the German market and last month we closed at a 90 per cent occupancy rate and at an 85 per cent occupancy rate for February.

These are very abnormal rates for this time of year and looking ahead I believe we will be operating at similar levels, certainly for the summer season.

As such, the hotel has been a very successful investment for the Mizzi Organisation and this year’s prospects do appear more positive.

Whereas there is always room for improvement in anything, considering the general feeling of a local economic downturn, we are holding our head above water.

Is there one particular market from which you derive your customer base?

Our client base appears to stem mainly from the UK and to a lesser extent from Europe. At the moment we have a lot of people coming from the Netherlands, Belgium and parts of Germany, but some 33 per cent of the house count regularly comes from the UK. But once again, that base is coming from a variety of suppliers in the UK, not just one. We are dependent on everyone, but not on any particularly operator to a large extent.

I believe that although having five star hotels is very good for the islands, we were happier working with the four star market. A five star requires a huge investment and is to a large extent dependent on very large conferences. The four star scenario is a much more manageable situation and we took a conscience choice to develop a four star hotel, given its location and the space avaliable for facilities.

We also have a lot of business travellers who find the hotel perfectly suitable to their requirements. This aspect of the business is going very strong.

What plans do you have in the pipeline for the future?

The hotel has developed a very successful banqueting business, which has been growing fairly steadily. Another important part of our business is that we also carry out a fair amount of local conference business through our facilities, which can accommodate some 100 people.

Additionally, we are also about to launch an external catering business for small functions serving between 60 and 100 people, such as receptions and smaller corporate events.

Our back of house facilities and the product itself are quite exceptional and we are seriously looking at developing this niche further.

Such developments will give added revenue to the hotel, which is the only other way of expanding the hotel – apart from adding more rooms, which we will look closer at in the future but that decision does not depend on us.

The Waterfront holds 116 rooms so it is on the smaller side of hotels. But what we have is the location, the view, the proximity to downtown Sliema and the look of the hotel, which is fresh in its novel and modern design.

Another point about the choice of location is that we saw that the Manoel Island project would eventually come in line and the real estate in this area would improve considerably. Actually, it seems we have even catalysed the real estate movement in the area by having this quality of hotel located here.

I certainly believe that if we ever develop future projects along these lines, we would retain the unique look and touch of this hotel.

Our success has been acknowledged by Thompson, one of the largest tour operators in the world and despite the fact that we have been in operation for just two years, we have had a large amount of repeat visitors.

So far we have received three awards from Thompson – the Gold Award for Health and Safety initiatives and the Summer Sun and Winter Sun awards.

The health and safety award means that this hotel is up to speed as far as present and future EU health and safety standards are concerned. The shareholders had engaged a substantial amount of money in contracting overseas consultants during the development stage, which turned out to be a good investment. They were very helpful in directing the project to the point at which it eventually arrived. The hotel’s fire prevention and safety features, particularly in view of our back of house operations, are very extensive.

Undoubtedly one of the main assets of The Waterfront is the management team led by Sonny Portelli who alone carries a wealth of experience in the tourism field. Needless to say, the long industry experience of the management team is a major factor that has given The Waterfront the competitive edge in the services industry.

Given that, the personal touch of the hotel is one of our crowning achievements. The fact that we don’t have huge volume numbers is a disadvantage from the aspects of the number of beds and from a cost spreading viewpoint, but it also gives the hotel that personal touch.

Although The Waterfront is not a boutique hotel, it is close to that in the personalised service, which is something we insisted on from day one.

One of our main missions when we first set out was to train our staff to be friendly and courteous. Our guests spend money from their savings and we know they want to be smiled at, told good morning etc.. The vision has worked through sheer determination on our side, but the end result certainly goes a long way toward satisfying tourists, which will, in turn, bring them back for repeat visits.