The Big Interview: Hilton Hotel's Steve Cassidy

About 30 years ago, Steve Cassidy was celebrating his graduation from Napier in the glitzy surroundings of The Caley hotel in Edinburgh's West End.

Steve Cassidy at The Caledonian  aka Waldorf Astoria Edinburgh  which has been promised £20m in investment by its new owners, Twenty14 Holdings. Picture: Jon Savage

He is now paying a return visit in a different guise, as senior vice-president UK and Ireland at Hilton, which in 2000 took over the running of the hotel, and reopened it as the Waldorf Astoria Edinburgh in 2012.

Cassidy is responsible for 144 hotels in the UK, including 22 in Scotland, and there are nearly 40 more in the pipeline. He sees “huge” growth across the geographies he covers.

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Sitting in the refined surroundings of The Pompadour by Galvin Cassidy restaurant, looking out to Edinburgh Castle, he says the Scottish capital is seeing some of Hilton’s strongest growth, not only in the UK, but across Europe.

PwC recently reported that the cost of spending the night in a hotel in the city grew three times faster than the UK average last year, while Edinburgh’s 83 per cent room occupancy rate is higher than anywhere else in Europe.

Hilton in fact has six hotels in the Scottish capital, spanning 911 rooms. In addition to The Caley these comprise the Grosvenor and Carlton Hiltons (in 2016 the latter unveiled the results of a £17 million refurbishment), Hampton by Hilton Edinburgh West End in Fountainbridge, which opened last year, and DoubleTree properties on Bread Street and at Edinburgh Airport.

Another hotel – a 240-room site at the airport – is set to open next year.

Altogether Hilton now has 22 hotels and 3,663 rooms in Scotland– employing more than 2,500 staff –with three more properties in the pipeline, and has just added the 148-room DoubleTree by Hilton Glasgow Westerwood Hotel & Golf Resort to its portfolio.

Cassidy highlights the explosion in visitors to Scotland – and its capital city in particular.

“We’re proud that in Edinburgh we’re able to meet that demand for hotel rooms with quality product in different price categories,” he says.

And he welcomes the boom both in staycations and overseas travel driven by the fall in the pound.

“Last year, visitor numbers to the UK in general were pacing well ahead of GDP growth, so it’s an important part of the economy,” he says, adding that Hilton has seen strong performances from Europe and the US as well as China, with particular potential in the latter.

The group is also opening a 200-room property at the new Aberdeen Exhibition and Conference Centre.

PwC said the city saw its occupancy rate and revenue per available room fall in 2017 as the slowdown in oil and gas continued to bite.

Cassidy admits that Aberdeen’s hotel market has been troubled in recent years for “obvious” reasons, but he is confident it will rebound. “We’re fully committed to the development pipeline that we have there, and we’re looking forward to developing even further.”

Back in Edinburgh, Cassidy is conscious of a concern that the proliferation of city-centre hotels is threatening the historic character and vitality of the Old Town and stretching infrastructure.

He stresses that while Hilton has an important role in people experiencing new cultures, it is “very conscious” of its social responsibility, particularly regarding local communities.

As a consequence, the company has just unveiled new targets to double its social impact investment and halve its global environmental footprint by 2030.

Cassidy is well-travelled himself, born in Bermuda to Scottish parents who met at primary school in Wishaw, brought up in Germany, and later living in Asia. But while he’s spent his life on the move, his heart is “very much in Scotland”.

He joined Hilton’s revenue-management team in 2009 after several years with British Airways, starting off in finance but gradually moving to more general management roles, and latterly running the cargo operation for the airline, based in Hong Kong for about three “wonderful” years.

His background in accountancy would have fitted him for range of careers, but “I always knew I wanted to be in a big team, community-type business where we were all working hard for one common purpose and cause”.

The Hilton group as a whole now encompasses more than 5,300 hotels worldwide across 14 brands and 106 countries. In its first-quarter results published in April, it said core earnings came in at $445m ($333m), marking a 9 per cent year-on-year jump.

Cassidy moved into Hilton’s hotel operations in 2011, and his remit expanded to its current focus in 2015.

He is also a board director of UKHospitality, which represents the industry that generates £130 billion in revenue each year and was created from the merger of the British Hospitality Association and the Association of Licensed Multiple Retailers.

Such a role comes as he seeks to give greater clout to a sector that is a major employer in the UK. “It’s important that we have a voice within government, so I felt being part of the UKHospitality was an avenue for contributing to that and representing the wider hospitality sector – and not just Hilton’s needs.”

Cassidy says skills and talent are going to be a “critical focus” going forward for the trade body, “and working with government to ensure that our messages around the attractiveness of our industry for workers from the UK get through”.

UKHospitality states that about one in 12 of the roughly 3 million workers in the sector are EU nationals, and Cassidy is keen to remove uncertainty caused by Brexit both for the business and staff.

But despite challenges presented by Britain’s withdrawal from the EU, and the growth of alternatives to hotel accommodation such as Airbnb, Hilton believes has great scope to expand further.

“If we can take our business and our ethos and our brands to more places, frankly geographical boundaries shouldn’t be a hindrance to that,” he says. Specific plans include developing types of location, especially airports and sporting venues.

Returning to the topic of the classic, historic grandeur of The Caley, which first opened in 1903, he insists it can more than hold its own against the influx of high-end hotels to Edinburgh.

The city is proving a magnet for luxury hotels, with St Andrew Square set to welcome both a new Malmaison in 2019, and the first Virgin hotel outside the US, a luxury 225-room property set to open by 2020.

Cassidy forecasts increased growth for The Caley backed by investment from new owners Twenty14 Holdings, which acquired the hotel in an £85m deal announced in January – the biggest hotel sale in Scotland in three years. It was revealed that a £20m programme would be rolled out over two years from 2019 by the Abu-Dhabi-based firm, with plans including another 50 rooms and creating 100 jobs.

“We’re very interested in the next developments for the hotel,” says Cassidy, adding that there is no room for complacency, with continued investment required to develop both the product and the guest’s experience.

“[With] investment complemented by an ambitious owner who’s willing to invest in the property, I think we can continue to be the pre-eminent destination for luxury travellers to Edinburgh.”

Looking at Hilton overall, he acknowledges the troubled economic backdrop in recent years, but points out that the group is behind one in five hotel rooms being built internationally, and is opening one hotel a day on average.

Cassidy also notes that Hilton is a “pure play” management and franchise business, meaning its growth comes from convincing owners that it’s the best hotel company to manage their properties.

And he believes that with its owners seeing growing value in their relationship with Hilton, its footprint of hotels will continue to expand.

Cassidy is proud the company has overseen better engagement from staff and offered guests better experiences in recent years.

“I want to continue to grow that every single year and off the back of that, our owners will be happy, we’ll be serving our communities better, and we’ll see a growth in the number of Hilton hotels in every market.”