Family values and a high level of care

Last Updated
22 June 2020
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In the midst of a global pandemic that no one saw coming, and the ensuing economic crisis, Tosaporn Sihanatkathakul and his family have endured a much more personal form of loss. In a touching conversation with David and Catherine, the Executive Director of the Landmark Lancaster Hotel Group reflects on the role of legacy and family in business—both literally and as it pertains to those who depend on a hotel for their livelihood.

En route to the new normal, Khun Tosaporn is looking to redesign current meeting spaces into what he describes as ‘goodwill spaces’. He also speaks candidly about the risks of investing in hotels at the moment, and what diversification means to him in the near to medium term.

TRANSCRIPT

START AUDIO

David Keen 0:00
Good afternoon Khun Tosaporn Sihanatkathakul, Executive Director of the Landmark Lancaster Hotel Group, and Catherine Monthienvichienchai, our Chief Branding Officer.

David Keen 0:12
Welcome Tung to The Future of Travel podcast. For all of you the Khung Tung is a fascinating character. A wonderful friend of all of us at QUO. He, His family and himself own critical hotels, there’s Landmark hotels and Lancaster hotels in Bangkok. And they also own the critically acclaimed Landmark London and the Royal Lancaster in London, among other hotels in London. So Thong is in a fascinating position to talk to us about the impact of the virus, the opportunities that the virus will present and already has presented, and how he and his family have overcome a huge family loss and gone into the hands of the virus with great humility, and extending it the family, the his father’s footsteps and made sure that the people and the employees and the business partners and stakeholders of the Landmark Lancaster Hotel Group have been looked after. How’s it been for you?

Tosaporn Sihanatkathakul 1:01
Well, thanks for the introduction, David, I mean. First of all, it’s great to be here, and thanks Catherine. QUO has been—and David himself, and his family — have been very good friends to Landmark Lancaster family as well. And then over the years he’s helping, branded, Lancaster Bangkok, which opened late in November, late in 2017. And we’ve been in touch ever since, sharing ideas and and sharing thoughts and a few a few drinks here and there also.

Tosaporn Sihanatkathakul 2:22
So um, I think it’s um…..

Tosaporn Sihanatkathakul 2:26
Well, my father he passed away in late February, and I was just speaking to David and Catherine just now, how once, how straight after experiencing this great loss. And basically, the leader of the organisation. And then we are thrown right into this pandemic that no one saw coming, and no one really knew what sort of impact and how great it is in terms of the damage that is going to cause everyone, and how we deal with it in a short, medium and long term.

Tosaporn Sihanatkathakul 3:16
So, we’ve been very careful in not overreacting. And, actually I was bad. This whole window of time. Just after my father passed in late February, to have this time to fly to London. And that was just before things broke out in London to see my team that my managers and my staff and, and obviously the team that we emphasise the fact that even though without Khun Jatuporn, my father. We, as a family— myself, my brother in particular—we want to uphold his values and continue what is done so great in the past, and. And obviously, then the virus was pretty much looming. And that, to be able to get to give that confidence to our people face-to-face, that we’re going to ride this out, and we have to work as a team, and be compassionate to each other. And then came back to Thailand. And then on the next Monday things went haywire, and from no one really being too concerned, I mean, we were some restaurants where they were telling us that last weekend they had record numbers.

David Keen 4:47
In London…

Tosaporn Sihanatkathakul 4:49
In London – a record-breaking brunch on Sunday.

Tosaporn Sihanatkathakul 4:54
It was at The Ned.

David Keen 4:55
Okay

Tosaporn Sihanatkathakul 4:56
At the net and then next week, it was empty.

Catherine Monthienvichienchai 5:00
Wow, such a sudden change.

Tosaporn Sihanatkathakul 5:01
Such a seven change. Things just flipped on its head. So that sort of allowed us to kind of put people at ease. To have to give them this comfort in for our properties in London, and then came back here in Thailand, where, where things have already pretty much died down with declining number of tourists and already the Bangkok government’s starting to impose emergency decree and curfew, which basically shut down many hotels, while […] like the Lancaster remain open, and the Lancaster only remained open for not so long, and we decided to shut down, and then pulled all of our resources into the Landmark.

Tosaporn Sihanatkathakul 5:56
And until today, the Landmark still remains open and and test opportunities right now, we think, I think almost like what other hotels, what other operators, and owners are trying to do is to use this downtime, to improve, and to renovate and that’s what we’re doing as well.

Tosaporn Sihanatkathakul 6:22
Some, some are luckier than others that they have already drawings, if they are doing major renovation. So they just push on with that. We are a bit different. Lancaster is a lot newer than the Landmark. It has only been open for two years. But the Landmark has been in business for almost 35 years. And obviously there are parts where it’s newer than others. And to make significant changes to our appearance is something that we’re trying to achieve for the next couple of years. But how we speed that up to take advantage of this downtime is quite critical, and also to bring it up to a standard

Tosaporn Sihanatkathakul 7:15
Unlike in the UK where we have the Royal Lancaster, which also underwent total renovation in 2017. we It was a four-year sort of process. From 2013 through 2017 we refurbished all of the 411 bedrooms and public areas. And it was not a renovation. It’s more like a transformation. And, and that has sort of…

David Keen 7:50
I remember I was, I was at, I was at the Royal Lancaster in London. Just before a visit from you and Jatuporn, from your father. And I was with Sally, the general manager, and I was reading data and she was showing me the new rooms

David Keen 8:14
But she was talking about your father, who was such a perfectionist. It was so extraordinary in his obsession with detail and how she was looking at literally every color scheme on the taps and with a touch with this or that.

David Keen 8:34
And your father was I think—you and your father were coming, the next day or the day after that and then she was just talking in such awe of him.

David Keen 8:41
And just. And then we must move on to business but just to talk a little bit about your family value system and how your value system in Thailand it’s, it’s better understood. Your father has imbued his values into you and to your siblings and into the, into the family and into the business because it’s all kind of meshed into one. How does that work in London?

Tosaporn Sihanatkathakul 9:26
When, when my father took over right back in 1993, he—I think straight away he told his staff that everyone is like a family. And that’s what he always—not just say but but does so as well—to make people feel that everyone is part of the family. And this is, this is a great test, because when, at the very first week that COVID unfolded itself, the GMs came to ask me that, are we considering sort of leave without pay measures that would reduce costs and stuff.

Tosaporn Sihanatkathakul 10:16
And that never crossed our mind because in the past we had the Tom Yum Koong crisis in 97. We had SARS, we had Bangkok shutdown, we had [the] flood. And, and every time someone came to us, Khun Jatuporn, he would say no. If we don’t pay our staff, how will they eat, or feed their family?

Tosaporn Sihanatkathakul 10:43
So that kind of stance, really resonated with me and my brother. And, and also those stories, obviously sort of chatted among the managers and trickled through to London. And everyone there knows that they are really fortunate, and I think they appreciate that they’re working for an independent family, a Thai family, with great family values and a high level of care.

Tosaporn Sihanatkathakul 11:21
I think we are the only two hotel companies that are owned and operated by an Asian to have been placed in the top 100 employers from The Times for almost four years running now

David Keen 11:40
It’s an amazing achievement.

Catherine Monthienvichienchai 11:41
Yeah.

Tosaporn Sihanatkathakul 11:42
Yes, and I think that speaks louder than any words that an owner might say, or a manager might say. It’s that this is really a tangible achievement of Khun Jatuporn’s legacy.

Catherine Monthienvichienchai 12:02
And looking at the future of the travel industry, looking at London versus Bangkok, how do you see the two cities, the two countries, coming out of this crisis? Do you see them following similar paths or taking very different directions in the future, and what will that look like?

Tosaporn Sihanatkathakul 12:19
Obviously, one thing we can gauge is, because by being here, we know that our figures in Bangkok, Thailand, as a whole is a lot better than in the UK, in London. And both countries are looking to reopen kind of late June, early July. But in the UK now, considering the fact that they will impose a 14-day quarantine to all arrivals, and that’s a very restrictive imposement on any sort of leisure travel, or business travel. While here in Thailand, no one has really strongly mentioned that they’re going to impose a 14-day.

Tosaporn Sihanatkathakul 13:04
I think, here we are going to be a bit more relaxed and. And the point where I say we can’t gauge is the feeling of the people, is because you’re not there. You can’t sense what the society is feeling, how cautious they are, how concerned they are. I mean, look at Thailand, for example. Last week, when the government allowed restaurants to reopen, you still don’t see that many people. But then last weekend, you go to the same place, and you see a lot more.

Catherine Monthienvichienchai 13:38
Right, you go to the malls, and they’re packed.

Tosaporn Sihanatkathakul 13:41
Yes.

Catherine Monthienvichienchai 13:41
Ten days…

Tosaporn Sihanatkathakul 13:42
So immediately, no one is returning, I mean, straightaway. But it only takes a couple of days—maybe four or five days for them to gain their confidence. And I think this speed, if it continues, then you’re going to be seeing a quicker return to normal in terms of people’s movement.

Catherine Monthienvichienchai 14:03
Has that surprised you though? That speed at which people have just jumped back into their lives. I mean in Thailand, we’ve obviously been very very lucky to have the virus relatively under control, very low numbers now. But has it surprised you how quickly people are letting their guard down, they’re going back out there in the malls, they’re shopping, they’re eating in restaurants?

Tosaporn Sihanatkathakul 14:21
I think that’s a good thing, and it has surprised me. But also I think you have to be quite mindful and… I think, especially for business people and then business owners and operators, to see where people are attracted to. I mean, with hotels it;’s different, because Thai people in the past, or maybe 20, 30 years ago, people would dine in hotels. But now, people choose to dine in malls or in standalone restaurants. And I think it’s these places that they are going back to, to experience that whatever the meal is that they want, first. Somewhere that they can go and they can relax. And they feel quite safe, quite distanced, and it’s not a hassle to get into. I think those businesses will benefit. And then, hotels will be a lot later. Because, in the past, people have shied away from dining in hotels.

David Keen 15:27
One of the challenges I foresee, unfortunately—both in London and in Bangkok—the hotel, your hotels confronting is the change that, certainly in the short to medium term, the change that people are seeing in terms of meetings. Obviously the Lancaster here. The Royal Lancaster in London and the Landmark… I don’t know the percentages, but they, they have a significant…

Tosaporn Sihanatkathakul 16:03
Yes

David Keen 16:04
… a significant meetings market. What are you doing as a group to confront that? do you foresee a faster return—as we were talking about with malls—to meetings, to face-to-face. Do you use size a lot of questions but do you see technology such as Zoom, such as Microsoft Teams, such as these meetings, replacing that face-to-face. And as such, is there really fundamental change in the hotel industry? Sorry, it’s a lot of questions.

Tosaporn Sihanatkathakul 16:31
I think, but my quick question and then we’ve been thinking about that as a company, because all of our hotels have meeting facilities.

David Keen 16:41
Right.

Tosaporn Sihanatkathakul 16:42
Especially in London where the majority of the business depends on corporate meetings…

David Keen 16:48
Sure.

Tosaporn Sihanatkathakul 16:48
…with the big, big firms, big companies from Europe, from America, who would come to London to meet. And I think that’s going to have a big impact in terms of how, what we’ve been used to now over the past few months with COVID. And that would definitely make it slower for hotels to regain their business volume, especially with meetings, there’ll be less meetings. There’ll be—meetings will only happen if required.

Tosaporn Sihanatkathakul 17:23
For example, we have IELTS, the examination, English-language tests AT the landmark in Bangkok, who use our facilities to hold their tests. And that will continue. But that will change with distancing rules, and possibly first-[…] screens to safeguard those children, those students that would come in to take tests.

Tosaporn Sihanatkathakul 17:57
But in terms of normal business meetings that a company might hold whether it be sort of shareholders meetings, or away days, or whatever. I think that would come back very slowly. And every hotel will have to prepare for that slow improvement.

David Keen 18:20
Are you able to make changes to combat that. I mean, I’m thinking about the Landmark in London, in particular, where it’s always… I mean that the ground floor is always…

Tosaporn Sihanatkathakul 18:29
Yes

David Keen 18:30
…just huge meetings, almost every… pretty much every day booked out, and evening events and weddings, what have you. How do you deal with that? It’s a significant portion of revenue.

Tosaporn Sihanatkathakul 18:42
That’s gonna be tough, but I think it’s where both hotels and their clients have to work together. So you would need requirements from the clients in terms of the level of safety that they need. And let’s say someone who’s interested to hold a meeting, come and talk to the hotel. We need to collaborate with them. And, and if there’s something that is a good idea that you can then record, and then share information and use that as a way to communicate to other companies that, look, we’ve done this. It’s possible to hold meetings for 100, for 200. But in such a fashion, showing them the advantage of having space where us, as bigger hotels, we are able to spread out people more than smaller hotels. So that’s the advantage of space. And the more, kind of, old-fashioned hotels—even in Bangkok or London—where you have a lot of rooms to play with.

David Keen 19:51
Are you repurposing? Are you thinking of looking deeply into the core of either the Landmark or the Royal Lancaster brand. I know you are looking at some other concepts in London. But are you looking at repurposing. In order to embrace the future…

Tosaporn Sihanatkathakul 20:10
Yes

David Keen 20:10
…or waiting for the future to come back?

Tosaporn Sihanatkathakul 20:13
I think we have to… re-embrace definitely. Right now at the Landmark Bangkok, we are working with a couple of designers to come up with a meeting-space concept at our basement. And this was before COVID, that we kind of earmarked that we’re gonna turn this space into meeting suites and meeting rooms.

Tosaporn Sihanatkathakul 20:40
But now with the COVID, and the demand for meeting, which is not going to come back in a speedy way, we have to think of ways that… how do we design a space that is flexible enough to become a rentable space, office space, and also a meeting space? But I think more importantly, space where it’s just that people can come and sit down and relax.

David Keen 21:46
It’s kind of a modern library.

Tosaporn Sihanatkathakul 21:47
Yeah, I see a lot of exhibition space, or even restaurants, where you lay out books, you lay out… You provide these resources, or even put up artwork. And people can come in, they can take refuge in a way.

Catherine Monthienvichienchai 22:12
It’s really interesting. This is kind of talking to this idea of hotels getting closer to the community, right? Getting closer to the location, the locale, the people. How important is that to you as a hotel operator?

Tosaporn Sihanatkathakul 22:24
I think we have to…

Catherine Monthienvichienchai 22:25
I mean, is that the future?

Tosaporn Sihanatkathakul 22:26
That’s the focus for us. That’s the focus for us. I mean we all look at space and look at, sort of, what level of revenue we can generate per square metre. And I think it would be wrong to use that as a benchmark. As the only benchmark. You have to provide a lot more than that. As you have the concern of the community, of the people in the area. You want to be their place of choice. And I think more and more people everywhere in the world are looking for that sort of experience, rather than I go to one place, you have to pay for something in order to use that space. I think you have to have more of an attraction to to really compete and stay sufficient and sustain yourself in the longer future.

Tosaporn Sihanatkathakul 23:30
Especially, more importantly now with COVID, everyone will be fighting for business. They’ll be heavily discounted, heavier price war among hotels that are still left standing. And so we have to find that extra mile to differentiate ourselves from the crowd.

Catherine Monthienvichienchai 23:54
And many of the big hotel groups are coming out with these announcements about partnerships, with these different bodies are offering cleaning standards or health standards within the network of hotels. How does that work for a smaller group like yourselves? How can you compete in terms of that reassurance, that certification, that kind of, you know, badge of stamp of cleanliness factor or whatever you want to call it, that these big groups claim they can now offer?

Tosaporn Sihanatkathakul 24:21
Yes, obviously, we learn from them.

Tosaporn Sihanatkathakul 24:26
[Laughs]

Tosaporn Sihanatkathakul 24:27
Sometimes, you can’t always invent everything.

Catherine Monthienvichienchai 24:33
[Laughs] Right.

Tosaporn Sihanatkathakul 24:33
So we look around. We…

David Keen 24:36
Inspiration.

Tosaporn Sihanatkathakul 24:37
And looking for inspiration…

David Keen 24:38
[Laughs]

Tosaporn Sihanatkathakul 24:39
And then adapt to our own version, And I think we’re quite fortunate to have certain partners like IELTS, where THEY would impose their requirements on us

Catherine Monthienvichienchai 24:49
Right, so you’re learning from your clients, as well.

Tosaporn Sihanatkathakul 25:52
We’re learning for our clients as well, but also whatever we can do to be proactive. I mean, you look at restaurants, outside of hotels, who have reopened. And there are some buffet restaurants that have reopened successfully.

Catherine Monthienvichienchai 25:05
Wow, already? So you want to focus there. [Laughs]

Tosaporn Sihanatkathakul 25:10
So you have to go and learn from them, to see what are they doing, what sort of measures have they imposed, and how has that impacted their customer experience? And how we can take that learning, and I won’t say copy it. You get inspired by it. But you have to morph it into such a way that is suitable for your space, your business, be it in a hotel or in the malls elsewhere.

David Keen 25:39
What do you think will happen? For all of us, the biggest problem is we don’t know where we are. We don’t know where we are in the crisis. We don’t know if there’s a huge second wave coming. We don’t know how severe the economic crisis is going to be, although all the indicators are, it’s going to be fairly awful. We don’t know how far… if the stock market will, or if there’ll be a bigger collapse. We don’t know so much.

Tosaporn Sihanatkathakul 26:22
We’re already seen a lot of real estate, hotels and office buildings coming up for sale.

David Keen 26:33
[Laughs]

Tosaporn Sihanatkathakul 26:35
But to be honest, I think if it was down to me, solely, I wouldn’t buy into… I wouldn’t invest into hotels.

Tosaporn Sihanatkathakul 26:44
I would not invest into hotels right now. I mean…

David Keen 26:45
You would not invest. Interesting. What would you invest in?

Tosaporn Sihanatkathakul 26:53
I think obviously the… for those that already have hotels up and running, you have to be very cautious. You have to make sure that you have enough to ride us out for the long term, and obviously make improvements. But only the very necessary improvements, because you have to spend your money wisely. As you said, David, no one knows where we are, at what stage we are. And I think even though if a hotel comes on the market, and this has such an enticing price, not only you have to go through all the due diligence to make sure that…

David Keen 27:34
It is what it is…

Tosaporn Sihanatkathakul 27:48
…the property is in good condition. And, and then you’re going to be stuck with an operating hotel, which we all know comes with a lot of costs, every month. And you don’t even know how long this is going to last, and when will you get to make returns on those hotels. So if I can diversify… because my family is very, sort of… has a majority…

David Keen 28:08
Heavey in hotels…

Tosaporn Sihanatkathakul 28:09
…heavy in hotels, portfolio. And pretty much a hundred percent in London. We should use this opportunity to look for investments into other industries, but not in hotels.

David Keen 28:24
It is certainly interesting. Your father was so wise in his choice of assets that he bought and was so able to to buy at the right moment. It fascinates me now as we sort of end the interview and end this conversation in a circle of again going back to your father, how you feel that the cycle of opportunity in hospitality, in these major cities may have run its course, maybe as a function of the virus. And you’re seeing opportunity in other areas?

Tosaporn Sihanatkathakul 29:01
Yes. Well, obviously we look for that diversification. But the tough question is where—what and where and how, even. But we all know, over this past couple of months, that we’ve relied heavily on technology. We’ve relied heavily on using apps and electrical devices. This digital age, and all sorts of things. So that’s where, I think, the—probably the industry that’s held up the best during this pandemic.

Tosaporn Sihanatkathakul 29:51
But that is almost the total opposite to what we’re doing right now in terms of investing in assets such as hotels and people. IT technology is all program. It’s all sort of knowledge of a group of people, and a very, very technical area.

Tosaporn Sihanatkathakul 30:17
If that’s too far-fetched then I think another good arena is in the healthcare industry. We’re lucky that we have involvement in hospitals in Bangkok. And we’ve seen… even though we’ve seen a decline in that business, but it’s nowhere near as bad as hotels.

Tosaporn Sihanatkathakul 30:40
So, for hotels we are seeing a hundred percent decline from where we have to zero. But the hospital numbers have gone down 20 per cent, 30 per cent month-on-month. So that is something that is an opportunity, I think if, if anyone is looking to diversify, then look around you. Look at those businesses that are still holding on better than hospitality, better than restaurants and other things.

David Keen 31:22
We’d love to talk all day, but I think we have to call it, we have to call it a day now. Khun Thong and Catherine, thank you so much for being our guest on The Future of Travel. Only our best wishes to your family and all of your teams, and all of your hotels.

Tosaporn Sihanatkathakul 31:40
Thanks, David. Thanks, Catherine. Thank you.

END