Estelar Medellín Hotels bets on the growth of its accommodation offer in Colombia

Recently on a tour of Colombia, Travel2latam was able to visit Medellín to learn about its main hotel establishments, attractions and experience some of its tourist experiences

(Source: Travel2latam)

As part of this tour, Travel2latam had the opportunity to speak with Carlos Arturo Quedada, General Manager of Hoteles Estelar Medellín.

How did Estelar Hotels start in Colombia?

Hoteles Estelar is a company with more than 55 years of experience in Colombia. It was born as an initiative of some investors from Valle del Cauca in Cali, in 1968. They decided to build the Intercontinental Hotel in Cali, because there was no good-sized hotel in the city. They made the investment and built the Intercontinental Hotel and signed a franchise and operation contract for 50 years. Over time, around the 80s, Hoteles Estelar took over a very famous hotel in Valle del Cauca, in Buenaventura, which is the main port on the Colombian Pacific. 60% of the merchandise that arrives from the southwest of Cali leaves through there. It is a 2-hour drive from Cali to Buenaventura. There, they took over a hotel that was already in operation that belonged to the Valle del Cauca Governorate, the Hotel Estación, a high-rise, very nice Republican building, and they remodeled it and fitted it out as a hotel and the first operation of Hoteles Estelar began. 

A few years went by and then Hoteles Estelar bought the Hotel Estelar La Fontana in Bogotá, which was owned by the company around 1983. Then they started operating a Hotel Estelar in Paipa, which is about 2 hours from Bogotá, it is a hot springs tourist destination. And through what is now Procolombia, with the Fiducoldex foundation, they built a convention and events center. It is a 105-room hotel with a convention center for 1,000 people and hotels that have been operating for more than 30 years. And there were already four hotels there. 

The company continued to grow. Around 1998, the company already had five or six hotels and continued to take operations to the point that today it has 26 hotels, three of which are in Peru.

Hoteles Estelares is a brand and a hotel operator, it operates its brands. But we have some cases, for example the Intercontinental Hotel in Cali, which had a contract change around 2005. So it is a franchise, but the operation is all done by us, by Hoteles Estelar. Hotel Estelar is a group, in fact it is the largest hotel group in Colombia in terms of assets and number of rooms.

How many are there in total? 

We have about 2,500, 2,600 rooms operated. 

What projects are coming up in the next places? 

At the moment there is a project in Pereira, which is right here in the coffee belt. It is the closest project. At the time of the pandemic, Hotel Estelar had just opened the Hotel Estelar Cartagena de Indias, which is the tallest building in the city, with approximately 340 rooms, a convention center, two rooms, one with capacity for 1,000 and the other for 1,200 people, a large-format hotel. 85.86% is owned by the company. That obviously meant that for a few years all the financial leverage stopped that growth a bit. But right now the company is again planning to grow again. So in the following years more projects should come, surely even looking for operations in South America and Central America. 

How did the company experience the pandemic? 

Estelar Hotels obviously protected its employees to the maximum. This was not a company that dismissed and closed hotels 100% of the time. A team was always maintained and agreements were made with employees, salary allocations, temporary agreements in which a salary reduction was made, but people were able to maintain their social security and income even without the hotels operating. 

And what was hotel life like during the pandemic? 

I wasn't at Hoteles Estelar at the time, but in general most hotels were left with a maintenance and security person to ensure that all systems continued to move. After stabilizing the flows and what must have been the first three months, Hoteles Estelar decided to create a management, an innovation and brand direction, and focus on the development of restaurant brands. Today Hoteles Estelar has around 12 restaurant brands, which are brands with their own life, with their own networks and image. There is a strategy behind that brand, a standard.

For example, we remodeled this restaurant in December, and we inaugurated it in February. It is a restaurant concept of international food with a focus on part of the menu at its source, which is local food, but presented in a way with a higher standard. There has been a complete change in our food and beverage sales. The company has taken advantage of this strategy and today has a much greater presence at a local level among clients who are not guests, and we have much more traffic with a strong strategic focus on the theme of restaurants and brands. Here, for example, we have the Medellín flavors route with our five restaurants. That is one of the most important things that was done there to sustain the economy of the hotels. 

What are your initiatives regarding your accounting and corporate social responsibility?

There are several programs, here we have one that is nationwide, so Estelar collaborates with a foundation that works with people, children, young people and adults who have a moderate level of cognitive disability. This foundation brings these people and helps them to connect to the working life, trains them and places them in companies in activities that they can learn and develop. It is an initiative of the company and we are in the selection process to have one person per hotel.

We also have a quality and sustainability department. Here we work with Diversa and Ecolab, for example, which are high-standard products and have a lower impact on the environment. At the hotel level, we have a linen reuse program, which is also present in the rooms, and we always invite guests to leave their towels hanging, to tell us if they want to reuse their towel or not change the sheets, but as a policy we change sheets after the fourth night. What we are doing there is saving water, using fewer chemical products through this program. 

At this moment in Colombia there is a sectorial technical standard for sustainability, which is mandatory to implement in order to have the national tourism registry. We have the implementation and certification of that standard in all hotels. Inside the hotels we have all the solid waste, we classify, for example, the oils, we separate them and we deliver them to a company that converts them into biofuels.

We also have a program with a foundation for all the bottle caps, we classify them and deliver them. It is also a national standard in Colombia, but it is in most major cities, to separate organic waste, everything that comes from food. This is delivered to a company that gives us a monthly certification. We separate between 300 and 350 kg of organic waste. Before, everything went to mixed landfills, now the organic waste is separated and goes through these companies, they take it to farms where composting is done, where it is ensured that it is not used for food. All of this is regulated in Colombia and obviously we have that compliance. 

Finally, we have the Ecoestelar seal, which is our own seal that brings together all of the initiatives I just mentioned and others that we have an internal seal for. Ecoestelar includes our entire sustainability policy. If you look now at the flower pots, in the gardens, you will even see the plants always identified with the common name and the name of the species. That is part of the sustainability program.

Another issue has to do with the source markets that different hotels normally have, in this city where we are today, what is the most important source market or what are the clear markets? 

In Colombia in general, the United States is the country that brings the most foreign tourists to Medellín. According to statistics from Cotelco, which is the hotel association, around 55% of travelers arriving in Medellín are foreigners, 45% are nationals. In the town sector, we are receiving a participation of that level, sometimes they are at 50%, we have hotels where we are at 45%. The Dominican Republic began about two years ago after the pandemic to have a large presence, and then the European countries would come, that is; North America, Central America and South America and then Europe.

What does the company project for the future?

We want to be present in all the countries of America in 10 years and we want to reach 40 hotels. Hotel Estelar, with just over 55 years in the market, has established itself as the most important national hotel brand in Colombia, it is worth mentioning. In terms of assets, first of all it is the brand with the greatest presence in Colombia, with the greatest reputation according to positioning studies in Colombia.

The company conducts a survey every two years and Hoteles Estelar is top of mind in the minds of Colombians as a national brand, competing with international brands such as Hilton. Obviously, since it is only present in two countries; Peru and Colombia, we could not speak of South America, but I think that any traveler who has come to Colombia identifies the brand in a good way. 

The company is exploring the possibility of expanding its operating scope, including including international brands in its portfolio with an operator and growth vision. At this time, a study has already been received and there may be a change in our portfolio. Hotels today have two categories: prime and superior. Prime hotels are like five-star hotels, full-service hotels with more services, and superior hotels are an intermediate midscale range with a star apartment model that are products for long stays.

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