Five years after buying the Hard Rock brand for nearly $1 billion, the Seminole Tribe of Florida is launching Hard Rock hotels in Mexico as part of a larger global expansion.
More hotels abroad should boost awareness of the hotel brand and bring more guests to existing properties, including Hard Rock hotels in Hollywood and Tampa, executives say.
The Seminole tribe is headquartered in Hollywood and owns seven casinos in Florida, including two in Hollywood and one in Coconut Creek.
In Mexico, Hard Rock is licensing its name to three existing hotels owned by Mexico's Palace Resorts with roughly 2,200 rooms. The all-inclusive resorts will be remodeled and open as Hard Rocks in Cancun and Puerto Vallarta this year and on the Riviera Maya south of Cancun next year, said Michael Shindler, executive vice president of Hard Rock hotels and casinos.
The Mexico launch builds on a successful partnership between Hard Rock and Palace Resorts on a 1,790-room hotel-casino in Punta Cana in the Dominican Republic that opened in 2010.
Hard Rock first unveiled plans for global expansion two years ago, but efforts advanced slowly because of limited credit for hotel developers in the wake of the 2008 financial crisis. Lending for hotels now is easing as financial markets recover, especially overseas, analysts said.
"Outside the United States, there seems to be more capital for hotels than inside," said Scott Brush, a hotel analyst in Miami. "So, building the brand internationally makes sense. That's where the money is."
Two examples show the quickening pace of finance for hotels abroad: Hard Rock's partners in Panama in April debuted the first 500-room phase of a 1,500 room casino-hotel in downtown Panama City, with the entire 66-floor Megapolis complex to open by January. Plus, a group has signed up to build a 375-room Hard Rock in Abu Dhabi in the United Arab Emirates, the chain's first hotel in the Middle East.
Hard Rock is investing little in the global expansion. It typically licenses its name to hotel developers. It also may manage the resorts or run the casinos. In some cases, it may invest a bit with a developer, but only if Hard Rock has a management deal, said Shindler.
To spur more hotels overseas, the company is adding representatives in key markets. It now has a consultant in China, one in India and a third focused on the Middle East and Europe. Running that growing portfolio has meant adding a few jobs at Hard Rock International headquarters in Orlando.
The Hard Rock brand had a half-dozen hotels open under license when the Seminoles bought the brand, including resorts in Indonesia and Thailand and at Universal Studios in Orlando.Plans now call for adding up to half a dozen hotels per year, including one large casino-hotel, said Shindler.
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