Cedar Court's new rulers

Cedar Court's new rulers

The man who founded one of Yorkshire’s most successful hotel chains has stepped down after 26 years. BQ meets two directors who are now running the Cedar Court group.

Multinational companies are discerning customers. You would expect a company like Nestle to care about where it holds its annual conference for all its senior managers. And in recent years the pattern has indeed been very familiar: London, Paris, and Rio de Janeiro. (Well, those harassed chocolate sellers need a bit of rest and relaxation sometimes.)

This September, however, a different destination has been added to the circuit: York. The company is, of course, a major employer in the city, but up until recently the lack of a five-star hotel there probably put the Swiss company’s management board off.

That has all changed since the Cedar Court Grand Hotel opened its doors a couple of years ago, and in particular since it achieved its five-star status in November last year. Th meant that Nestle was more than happy to use it as a base for the grand get-together this September.

The development of the hotel – a conversion of the former North East Railway headquarters – has already been covered by this magazine. But what takes the story on this time is that just as that five-star goal was reached, just as the big conferences were coming in, the man behind it all announced he was leaving.

Yes, 27 years after opening his first Cedar Court hotel just off the M1 motorway outside Wakefield, and at the age of 74, George Demetriou is stepping down as group managing director of the Acropolis Group, which owns the Cedar Court chain of hotels that includes Bradford, Huddersfield and Harrogate as well as Wakefield and York.

He will remain a non-executive of both the trading company and its holding company, but his old title will be taken on by Kevin Henry, who was previously group financial director, while group hotel director John Horvath will retain overall responsibility for day-to-day management of the hotels themselves.

Demetriou himself has remained famously publicity shy throughout his time at the helm, rarely granting an interview, even through the many years when his company was one of the fastest growing companies in Yorkshire.

And even on retirement, he would only release a few short statements about what he felt. But his story is nonetheless one worth telling. He didn’t, for example, start out in hotels. The first place he opened after moving to Britain from his native Cyprus in 1957 was a coffee shop, and after that, in 1960, a steak house.

The steak house must have quickly made an impression, because Helen Shapiro came to sing at it shortly afterwards, accompanied by her support act, a group going by the name of the Beatles.

The coffee house and steak house empire grew, but, as Kevin Henry explains, things went into a different gear in 1978, because that was when he first bought a plot of land near the still relatively new motorway near Wakefield, and initially planned to open a 40-bedroom motel.

Gerry Lumb, the managing director of what was then called Sirdar, a listed textile company based in Wakefield, heard about the plans, and decided he could persuade the mysterious new landowner to aim higher.

“You tend to forget that 25 years ago there weren’t many hotels on motorway junctions,” says Henry. “Sirdar was mainly a hand knitting company which was extremely successful at that time, and had a lot of money in the bank earning interest but not doing much.”

Lumb thought that Wakefield would be better off with an 100-bed hotel, not motel, and more to the point a hotel with conference and banqueting facilities.

“Big companies like Sirdar didn’t have anywhere to hold that sort of event in Wakefield,” says Henry. Lumb sought a meeting with Demetriou. In the course of proceedings the two men discovered they were next door neighbours, and had been for over a decade, but had never spoken to each other.

"Most unusually, Demetriou agreed to the two companies building the hotel as a joint venture. Henry thinks Demetriou “may have been attracted to the idea of building something more substantial”.

But a joint venture between a textile company and a coffee shop owner that aimed to build such big property as its first foray into the hotel business? Henry smiles. “Yes, it was perceived as odd, even in those days,” he says.

Nevertheless, the hotel, which opened in 1985, proved to be a success. Henry, who by this time had joined Sirdar from PwC, was brought in as company secretary of the joint venture, and a new hotel was opened in Bradford in 1995.

This was retained by Sirdar when the joint venture demerged in 1997, while Acropolis Group retained the Wakefield hotel. But when Sirdar came under pressure to dispose of non-core assets in 2001 and a new owner failed to prosper, Acropolis bought the Bradford hotel back.

By that time the company had also opened the two other hotels in Huddersfield, one which was formerly a Hilton, and Harrogate, a building that had formerly been NHS offices. Demetriou is stepping down having achieved something he says he had always dreamed of – opening a five-star hotel in York.

Henry, who was invited by Demetriou to come back to work for him in 2010 just months after he had finally left Sirdar (now called Airea) after 25 years, says the signs are good. “Just last week the Cedar Court Grand had its record ever week in terms of total revenue,” he says.

“It is also experiencing the highest occupancy levels within the group. In good weeks we are getting well over 80%.”

But what do the two new directors feel is the immediate focus as the group moves forward without its founder?

Henry points out that he is managing director of the whole group, not just the hotels, and that in fact first priorities consist of “streamlining” the other parts of the business.

This effectively means exiting the coffee bar business. At one stage Acropolis owned 16, when Henry joined there were four, now there are just two, both of which are in the process of being sold off.

The group would rather not compete with the likes of Starbucks. But the group also has some investment properties, including a business park right next to the Wakefield hotel, which it is intent on keeping.

“There are three office blocks there which are easy to manage because they are near,” says Henry.

“We have just had two refurbished, and will be marketing them soon.” Nevertheless, he concedes that in the more medium term the major focus has to be the hotels, and not now the Cedar Court: that is clearly doing well.

It’s the three more corporate hotels that may need some adjusting. What has been particularly affecting in recent years, he says, even allowing for the economic downturn, is the decline generally in the number of major business events and conferences that these three hotels were designed to serve.

“There are still a number of those, but not of the same magnitude,” he says. “Companies would in the past comfortably send 100 people for three days, with a free bar for a celebration. Businesses don’t tend to do that now. Either there is a one night stay or they do it all in one day. The sales reps still come, but maybe for two nights rather than three, and they may not have dinner at the hotel or even stay for breakfast in the morning. People are up at 6.30am then they are off.”

John Horvath is more bullish. He says there is still a thriving corporate market at the Huddersfield hotel, fed mainly by the banking businesses in Halifax and the chemicals firms in Huddersfield itself.

But he agrees that there is more refocusing work to be done in Bradford and particularly in Wakefield. That is why this summer has already seen the upgrading of 18 bedrooms at Wakefield, with the promise of further refurbishments at Huddersfield, Harrogate and Bradford in the next 12 months. “We have been producing boutique bedrooms and improving the beds to get a good night’s sleep,” he says.

“The mattresses in the refurbished rooms are exactly the same as the ones we have in our five star hotel in York.”

The focus, he says, has been on making the hotels a more attractive leisure destination. Thanks in part to the opening earlier in the year of the new Hepworth Gallery in Wakefield and ongoing interest in the Yorkshire Sculpture Park, the results are already coming in.

“We have just had the best August in Wakefield in 26 years,” he says. “Last week we were up to 70% occupancy, whereas in January and February we were in the 40s and 50s.”

He now hopes Bradford will benefit from the World Curry Festival held once again in the city in September. So there is work to be done. Demetriou is not relinquishing ownership of the group, by any means.

That remains split into two: 76% of the business is owned by him, with the rest owned by a Demetriou family trust. So are either of the two new directors worried about stepping into the founder of the business’s shoes, particularly when he still owns the company?

Horvath says time has moved on, and the business had become too large to be run by someone with Demetriou’s entrepreneurial zeal on his own. Henry says he knows enough about the wider family – one of whom he used to work with at Sirdar - to feel secure.

“Bringing in a total unknown to a family business can be traumatic - look at what happened at Betty’s,” he says, referring to Andrew Baker’s departure from the family-owned tea business last year after just five months.

“But I don’t know the story there. As for me, I think it beneficial that they as a family could recruit somebody that they trusted and had confidence in.”