The approach taken to recruit and operate the Radisson hotel being developed within the £400 million regeneration of Sheffield could serve as a template for future partnerships in regional cities across the UK, according to a panel at the Annual Hotel Conference on 11 September in Manchester.
Adela Cristea, Vice President, Head of Business Development UK, Ireland & Nordics, Radisson Hotel Group, admitted that the company “had to adjust our models”, as it came on board as part of a he redevelopment of the city’s centre.
“In this case, it was apparent from the beginning that the council did not want to employ the workers, so we had to work out how we did that, as a condition was payment of the real living age. It did impact profitability but also means we will have the best paid and very happy employees.,” she said.
A core part of Radisson’s involvement has been its engagement with the local community and the hotel group has been in close liaison with the city’s educational institutions as it looks to capitalise on the combined student population of around 35,000 young people.
Andrew Davison, Project Director at main developer Queensberry, partnered with Sheffield’s local authority on the project in 2016 and said that one of the key questions is how the partners could drive sustainability and social value.
“The model was simple because we had a situation where developers were buying land but then sitting on it. Regional development is very hard to make work, especially in terms of quality. So you have to look at the wider benefits,” Davison said.“When we went to the market for a hotel operator, the requirements were much higher than just finance. There are KPIs all over the contracts [for social as well as financial metrics] and we felt that Radisson was a step ahead,” he added.
Operational ESG
Queensberry will be employing someone to monitor how everyone is operating their businesses, from the office blocks to the hotel, to ensure they are being optimised.
“In addition, Radisson won’t be in a traditional contract where the owner could change every few years,” he said.
Sean McClean, Director of Regeneration and Development, Sheffield City Council, said that taking the lead in the regeneration of the city centre meant putting control in its own hands.
“The hotel is part of what we want from the centre of the city, creating a different city that people want to work in, live in and come and stay in,” he said. “As a council, setting our standards in what we expect in terms of sustainability but also a real living wage, means that we can have an impact for the greater good of the city.”
As a result, he said that if other hotels in the city want to compete for talent then they will have to offer similar packages to Radisson.
“That’s how we as a council can influence change and drive social value through public procurement,” he said.
Repeating the Sheffield model
Davison hopes that Queensberry will be able to expand the Sheffield model and apply similar approaches and learnings to other cities. The company is working on a Radisson Red hotel in Huddersfield.
“Doing these sorts of projects is different financially. It will probably need to be held for 20 years but they are looking at the wider social impact. We’re also pushing ahead with projects in Nuneaton and Grimsby and would welcome other hotel operators to talk to us,” he stressed.
Likewise, McClean is keen to help other cities learn from the process that has taken place in Sheffield.
“We’re happy to share our experiences,” he said. “It’s about the social value these projects bring.”
The panel session Powering Positive Change: Hospitality for Social Impact took place at the Annual Hotel Conference in Manchester on 11 September.