How Peninsula hotels make profits from the past

Clement Kwok King Man has had a busy 12 months. In that time, the Hongkong and Shanghai Hotels chief executive has opened a new Peninsula hotel in Paris, signed a €300 million (HK$2.55 billion) deal to develop one in Istanbul and submitted a planning application for a landmark site in London.

That is a breakneck pace for an executive charged with the stewardship of a 150-year-old hotel brand that positions itself as being as much a builder of history as it is a purveyor of some of the planet's most elegant accommodation.

"We would like to open [a new hotel] every three years or so. I have opened three hotels in my 13 years here," Kwok told the "and we are trying to do two to three in the next five to six years.

"If we are able to accomplish that, then we will have done six in 18 to 20 years of my time here, which is the right sort of balance between development and progress and spending enough time on the details of getting it right."

It is rare to interview a company chief these days whose time horizon extends much beyond the next couple of quarters, never mind the next couple of decades - a period Kwok describes as one in which a business should expect to be "riding through the shorter-term ups and downs" of the life cycle of an asset.

Then again, making a judgment about where to open an iconic Peninsula hotel is not a snap decision, especially considering that Hongkong and Shanghai Hotels (HSH) and the family behind it - the Kadoories - do not begin a transaction planning for a potential exit.