Four Seasons Hotels and Resorts
Encyclopedia
Four Seasons Hotels, Inc. is a Canadian
-based international ultra-luxury, five-star hotel
management company. Travel + Leisure
magazine and Zagat Survey
rank the hotel chain's 84 properties among the top luxury
hotels worldwide. Readers of Conde Nast Traveler
magazine have voted the company's Golden Triangle property in northern Thailand as their favorite in the world for three consecutive years. The company has been named one of the "100 Best Companies to Work For" by Fortune
every year since the survey's inception in 1998, ranking 53rd in 2011.
Four Seasons generally earns 3 percent of the gross income and approximately 5 percent of profits from the properties it operates, and the property owners are required to additionally contribute money for chain-wide sales, marketing and reservations systems. Four Seasons hotels have larger staffs than competing chains, therefore they create a separate reserve accounts to cover upkeep costs. While profit margins are relatively low, the reputation of the brand and the value of the hotel for sale as well as loan collateral generates developer interest. The Four Seasons also produces a complimentary magazine for guests that is supported by advertising revenue.
Four Seasons has a fractional ownership
division, Four Seasons Residence Clubs.
Four Seasons bases its business model on 4 pillars: Quality, Service, Culture and Brand.
founded Four Seasons in 1960. While a young architect working for his father, Sharp designed a motel for a family friend that succeeded and inspired him to try creating his own hotel in Toronto
. As the only large parcel of land he could buy was in a disreputable area, he designed the hotel as an oasis for business travelers; the Four Seasons Motor Hotel opened in 1961. Sharp built more hotels, but upscale luxury did not become part of brand until the company expanded to London
. When a developer approached Four Seasons about building a hotel in London, Sharp argued that the hotel should compete with the city's old-world, elite hotels, such as Claridge's
and The Connaught
, which he felt treated customers based on their social class
. The hotel opened in 1970.
In 1974, cost overruns at a Vancouver
property nearly led the company into bankruptcy
. As a result, the company began shifting to its current, management-only business model and eliminate costs associated with buying land and buildings and instead begin earning profits once the hotel opens. The company went public
in 1986. In the 1990s, Four Seasons and Ritz-Carlton
began direct competition, with Ritz-Carlton emphasizing a uniform look while Four Seasons emphasized local architecture and styles with uniform service; in the end Four Seasons gained market share.
The first full-service spa was introduced in 1986 at Four Seasons Resort and Club Dallas at Las Colinas
and today, nearly all Four Seasons hotels and resorts have spa facilities, and the remainder offer spa services. In recent years, restaurants at Four Seasons hotels and resorts have been recognized by Zagat and Michelin
. The latter has awarded at total of 14 stars to eight of the company's restaurants, including Hong Kong
(two restaurants), Macau, Paris, Prague, New York, Los Angeles and Chicago.
Recent economic downturns have affected the company. When the September 11 attacks caused the collapse of the travel industry
, Four Seasons refused to cut room prices in order to preserve the perceived value of the brand, which caused tension with property owners who were losing money. The company recovered and, in 2007, it agreed to a buyout
by Microsoft
Chairman Bill Gates
and Prince Al-Waleed bin Talal
of Saudi Arabia
for $3.8 billion. The pair owns 95 percent of the company, in equal shares, Sharp owns the rest. In August 2010, Kathleen Taylor was appointed CEO of the company.
Challenges returned again during the financial crisis of 2007–2010. The company made its first corporate layoffs in its history, cutting 10% of its Toronto workforce. In April 2010, after a year-long dispute with Broadreach Capital Partners and Maritz, Wolff & Co., owners of the Aviara resort near San Diego, an arbitration panel ruled that while both parties contributed to the demise of the business relationship, "Four Seasons didn't violate its management agreement, as Broadreach had alleged, according to a joint statement released by the companies. The panel ordered that Broadreach pay Four Seasons to terminate the contract." The resort is no longer a Four Seasons.
Four Seasons continues to add more hotels and resorts to its portfolio, notably in China. It opened a new hotel in Hangzhou
in 2010 and will open in Guangzhou
and nine more properties in cities including Beijing and Shanghai to bring its hotels in China to 14. It will also open new hotels in India to add to its one hotel in Mumbai
. In 2009, it was reported that they would add a hotel in the Lobanov-Rostovsky Residence
of Saint Petersburg
.
in 1981, which has since grown into the world's largest single day cancer fundraiser, with events around the world every September. To date, the Terry Fox Run has raised close to half a billion dollars.
On June 19, 2002 the Canadian Opera Company
announced Four Seasons Hotels as the naming donor for the COC's new Opera House, also home to the National Ballet of Canada
, the Four Seasons Centre for the Performing Arts, located in Toronto.
Canada
Canada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...
-based international ultra-luxury, five-star hotel
Hotel
A hotel is an establishment that provides paid lodging on a short-term basis. The provision of basic accommodation, in times past, consisting only of a room with a bed, a cupboard, a small table and a washstand has largely been replaced by rooms with modern facilities, including en-suite bathrooms...
management company. Travel + Leisure
Travel + Leisure
Travel + Leisure is a travel magazine based in New York City, New York. Published 12 times a year, it has 4.8 million readers, according to its corporate media kit. It is put out by American Express Publishing Corporation, which is a wholly owned subsidiary of American Express Company led by...
magazine and Zagat Survey
Zagat Survey
Zagat Survey was established by Tim and Nina Zagat in 1979 as a way to collect and correlate the ratings of restaurants by diners. For their first guide, covering New York City, the Zagats surveyed their friends. As of 2005, the Zagat Survey included 70 cities, with reviews based on the input of...
rank the hotel chain's 84 properties among the top luxury
Luxury resorts
A luxury resort is an expensive vacation facility which is fully staffed and has been rated with five stars. Luxury resorts often boast many visitor activities and attractions such as golf, watersports, spa and beauty facilities, skiing, natural ecology and tranquility. Because of the extent of...
hotels worldwide. Readers of Conde Nast Traveler
Condé Nast Traveler
Condé Nast Traveler is a US magazine published by Condé Nast. It has its origins in a mailing sent out by the Diners Club club beginning in 1953, listing locations that would take the card. It began taking advertising in 1955. In order to attract more advertisers, it became a full-fledged magazine,...
magazine have voted the company's Golden Triangle property in northern Thailand as their favorite in the world for three consecutive years. The company has been named one of the "100 Best Companies to Work For" by Fortune
Fortune (magazine)
Fortune is a global business magazine published by Time Inc. Founded by Henry Luce in 1930, the publishing business, consisting of Time, Life, Fortune, and Sports Illustrated, grew to become Time Warner. In turn, AOL grew as it acquired Time Warner in 2000 when Time Warner was the world's largest...
every year since the survey's inception in 1998, ranking 53rd in 2011.
Business model
Four Seasons does not own most of its properties; it operates them on behalf of real estate owners and developers. The contracts between Four Seasons and property owners typically permits the company to participate in the design of the property and run it with nearly total control over every aspect of the operation.Four Seasons generally earns 3 percent of the gross income and approximately 5 percent of profits from the properties it operates, and the property owners are required to additionally contribute money for chain-wide sales, marketing and reservations systems. Four Seasons hotels have larger staffs than competing chains, therefore they create a separate reserve accounts to cover upkeep costs. While profit margins are relatively low, the reputation of the brand and the value of the hotel for sale as well as loan collateral generates developer interest. The Four Seasons also produces a complimentary magazine for guests that is supported by advertising revenue.
Four Seasons has a fractional ownership
Fractional Ownership
In business, fractional ownership is a percentage share of an expensive asset. Shares are sold to individual owners. A fractional owner enjoys priorities and privileges, such as reduced rates, priority access on holidays and income sharing. Typically, a company manages the asset on behalf of the...
division, Four Seasons Residence Clubs.
Four Seasons bases its business model on 4 pillars: Quality, Service, Culture and Brand.
History
Canadian businessman Isadore SharpIsadore Sharp
Isadore "Issy" Sharp, OC is a Canadian businessman and founder and chairman of Four Seasons Hotels and Resorts.In 1952, he graduated from Ryerson University with a diploma in Architectural Technology...
founded Four Seasons in 1960. While a young architect working for his father, Sharp designed a motel for a family friend that succeeded and inspired him to try creating his own hotel in Toronto
Toronto
Toronto is the provincial capital of Ontario and the largest city in Canada. It is located in Southern Ontario on the northwestern shore of Lake Ontario. A relatively modern city, Toronto's history dates back to the late-18th century, when its land was first purchased by the British monarchy from...
. As the only large parcel of land he could buy was in a disreputable area, he designed the hotel as an oasis for business travelers; the Four Seasons Motor Hotel opened in 1961. Sharp built more hotels, but upscale luxury did not become part of brand until the company expanded to London
London
London is the capital city of :England and the :United Kingdom, the largest metropolitan area in the United Kingdom, and the largest urban zone in the European Union by most measures. Located on the River Thames, London has been a major settlement for two millennia, its history going back to its...
. When a developer approached Four Seasons about building a hotel in London, Sharp argued that the hotel should compete with the city's old-world, elite hotels, such as Claridge's
Claridge's
Claridge's is a luxury hotel in Mayfair, central London. It is located at the corner of Brook Street and Davies Street.-History:Claridge's is a traditional grand hotel. Its extensive and old connections with royalty have led to it being referred to as an "extension to Buckingham Palace"...
and The Connaught
The Connaught (hotel)
The Connaught in Carlos Place, Mayfair, central London, is a five star luxury hotel.The hotel first opened in 1815 as the Prince of Saxe Coburg Hotel, an offshoot of a hotel opened by Alexander Grillon in Albemarle Street, Mayfair, and was originally a pair of Georgian houses in Charles Street,...
, which he felt treated customers based on their social class
Social class
Social classes are economic or cultural arrangements of groups in society. Class is an essential object of analysis for sociologists, political scientists, economists, anthropologists and social historians. In the social sciences, social class is often discussed in terms of 'social stratification'...
. The hotel opened in 1970.
Vancouver
Vancouver is a coastal seaport city on the mainland of British Columbia, Canada. It is the hub of Greater Vancouver, which, with over 2.3 million residents, is the third most populous metropolitan area in the country,...
property nearly led the company into bankruptcy
Bankruptcy
Bankruptcy is a legal status of an insolvent person or an organisation, that is, one that cannot repay the debts owed to creditors. In most jurisdictions bankruptcy is imposed by a court order, often initiated by the debtor....
. As a result, the company began shifting to its current, management-only business model and eliminate costs associated with buying land and buildings and instead begin earning profits once the hotel opens. The company went public
Public company
This is not the same as a Government-owned corporation.A public company or publicly traded company is a limited liability company that offers its securities for sale to the general public, typically through a stock exchange, or through market makers operating in over the counter markets...
in 1986. In the 1990s, Four Seasons and Ritz-Carlton
Ritz-Carlton
The Ritz-Carlton is a brand of luxury hotels and resorts with 75 properties located in major cities and resorts in 24 countries worldwide...
began direct competition, with Ritz-Carlton emphasizing a uniform look while Four Seasons emphasized local architecture and styles with uniform service; in the end Four Seasons gained market share.
The first full-service spa was introduced in 1986 at Four Seasons Resort and Club Dallas at Las Colinas
Four Seasons Resort and Club Dallas at Las Colinas
Four Seasons Resort and Club Dallas at Las Colinas is a five-star golf resort that is located just a few miles north of Dallas, in the hills of Irving, Texas...
and today, nearly all Four Seasons hotels and resorts have spa facilities, and the remainder offer spa services. In recent years, restaurants at Four Seasons hotels and resorts have been recognized by Zagat and Michelin
Michelin
Michelin is a tyre manufacturer based in Clermont-Ferrand in the Auvergne région of France. It is one of the two largest tyre manufacturers in the world along with Bridgestone. In addition to the Michelin brand, it also owns the BFGoodrich, Kleber, Riken, Kormoran and Uniroyal tyre brands...
. The latter has awarded at total of 14 stars to eight of the company's restaurants, including Hong Kong
Four Seasons Hotel Hong Kong
Four Seasons Hotel Hong Kong is a five-star hotel building in Sun Hung Kai Properties-owned International Finance Centre, Central, Hong Kong that was completed and opened in September 2005. It is a 45-storey building offering 399 rooms and 519 residential units...
(two restaurants), Macau, Paris, Prague, New York, Los Angeles and Chicago.
Recent economic downturns have affected the company. When the September 11 attacks caused the collapse of the travel industry
Economic effects arising from the September 11 attacks
Major economic effects arose from the September 11 attacks, with initial shock causing global stock markets to drop sharply. The attacks themselves caused approximately $40 billion in insurance losses, making it one of the largest insured events ever....
, Four Seasons refused to cut room prices in order to preserve the perceived value of the brand, which caused tension with property owners who were losing money. The company recovered and, in 2007, it agreed to a buyout
Buyout
A buyout, in finance, is an investment transaction by which the ownership equity of a company, or a majority share of the stock of the company is acquired. The acquiror thereby "buys out" control of the target company....
by Microsoft
Microsoft
Microsoft Corporation is an American public multinational corporation headquartered in Redmond, Washington, USA that develops, manufactures, licenses, and supports a wide range of products and services predominantly related to computing through its various product divisions...
Chairman Bill Gates
Bill Gates
William Henry "Bill" Gates III is an American business magnate, investor, philanthropist, and author. Gates is the former CEO and current chairman of Microsoft, the software company he founded with Paul Allen...
and Prince Al-Waleed bin Talal
Al-Waleed bin Talal
Prince Al-Waleed bin Talal is a Saudi Arabian billionaire and member of the Saudi royal family. He is the nephew of King Abdullah of Saudi Arabia. An entrepreneur and international investor he has amassed a fortune through investments in real estate and the stock market.He is founder and CEO of...
of Saudi Arabia
Saudi Arabia
The Kingdom of Saudi Arabia , commonly known in British English as Saudi Arabia and in Arabic as as-Sa‘ūdiyyah , is the largest state in Western Asia by land area, constituting the bulk of the Arabian Peninsula, and the second-largest in the Arab World...
for $3.8 billion. The pair owns 95 percent of the company, in equal shares, Sharp owns the rest. In August 2010, Kathleen Taylor was appointed CEO of the company.
Challenges returned again during the financial crisis of 2007–2010. The company made its first corporate layoffs in its history, cutting 10% of its Toronto workforce. In April 2010, after a year-long dispute with Broadreach Capital Partners and Maritz, Wolff & Co., owners of the Aviara resort near San Diego, an arbitration panel ruled that while both parties contributed to the demise of the business relationship, "Four Seasons didn't violate its management agreement, as Broadreach had alleged, according to a joint statement released by the companies. The panel ordered that Broadreach pay Four Seasons to terminate the contract." The resort is no longer a Four Seasons.
Four Seasons continues to add more hotels and resorts to its portfolio, notably in China. It opened a new hotel in Hangzhou
Hangzhou
Hangzhou , formerly transliterated as Hangchow, is the capital and largest city of Zhejiang Province in Eastern China. Governed as a sub-provincial city, and as of 2010, its entire administrative division or prefecture had a registered population of 8.7 million people...
in 2010 and will open in Guangzhou
Guangzhou
Guangzhou , known historically as Canton or Kwangchow, is the capital and largest city of the Guangdong province in the People's Republic of China. Located in southern China on the Pearl River, about north-northwest of Hong Kong, Guangzhou is a key national transportation hub and trading port...
and nine more properties in cities including Beijing and Shanghai to bring its hotels in China to 14. It will also open new hotels in India to add to its one hotel in Mumbai
Four Seasons Hotel Mumbai
Four Seasons Hotel, Mumbai is a five-star hotel and part of the Toronto-based Four Seasons luxury hotels and resorts. It is located in the emerging district of Worli, Mumbai. The hotel currently houses 202 guest rooms, and also offers India's highest rooftop Aer bar...
. In 2009, it was reported that they would add a hotel in the Lobanov-Rostovsky Residence
Lobanov-Rostovsky Residence
Lobanov-Rostovsky Residence or the Lobanov-Rostovsky Palace is a building at 12 Admiralteysky Avenue in Saint Petersburg, Russia, constructed in 1817-1820 for Prince A.Y. Lobanov-Rostovsky...
of Saint Petersburg
Saint Petersburg
Saint Petersburg is a city and a federal subject of Russia located on the Neva River at the head of the Gulf of Finland on the Baltic Sea...
.
Philanthropy
The company and its hotels and resorts have long been involved in philanthropic programs, with a focus on building communities, advancing cancer research and supporting sustainability. Notably, Four Seasons was one of the founders of the Terry Fox RunTerry Fox Run
The Terry Fox Run is an annual non-competitive charity event held in numerous regions around the world in commemoration of Canadian cancer activist Terry Fox, and his Marathon of Hope, and to raise money for cancer research....
in 1981, which has since grown into the world's largest single day cancer fundraiser, with events around the world every September. To date, the Terry Fox Run has raised close to half a billion dollars.
On June 19, 2002 the Canadian Opera Company
Canadian Opera Company
The Canadian Opera Company is an opera company in Toronto, Ontario, Canada. It is the largest opera company in Canada and the third largest producer of opera in North America. The COC performs in its own opera house, the Four Seasons Centre for the Performing Arts.-History:For 40 years until...
announced Four Seasons Hotels as the naming donor for the COC's new Opera House, also home to the National Ballet of Canada
National Ballet of Canada
The National Ballet of Canada is Canada's largest ballet troupe. It was founded by Celia Franca in 1951 and is based in Toronto, Ontario. Based upon the unity of Canadian trained dancers in the tradition and style of England's Royal Ballet, The National is regarded as one of the premier classical...
, the Four Seasons Centre for the Performing Arts, located in Toronto.