What Ken McCulloch doesn’t know about the hotel industry probably isn’t worth knowing. The Scotsman’s career in hospitality spans more than 50 years and he has been described by his peers as the only genuine hotel entrepreneur.
McCulloch has grafted. He has succeeded and failed, but he has never given up. Why? Because, he says, he loves what he does and ultimately, if he continues to focus on the guest and what the guest wants, failure will not be an option.
And what the guest wants now is a new luxury offering, says McCulloch, who is fresh from opening the first of a new chain of hotels – Dakota Deluxe.
The first Dakota Deluxe opened in Glasgow in March this year. The converted 1960s office block on West Regent Street in the city centre provides 83 bedrooms including 12 suites and a deluxe suite. Room rates start at around £200 a night and rise to as much as £750. It is a far cry from its namesake, the mid-market level Dakota brand, where rooms cost on average £70 a night.
And where Dakota offers value for money at edge-of-town locations, the Deluxe brand will focus entirely on city centre sites and aim to attract a more discerning guest, perhaps even a celebrity or two.
But before the future, what about the history?
McCulloch’s story begins back in the mid-1960s, when at 16 he quit school. His father, Archie McCulloch – one of the founders of Scottish Television – lined him up with an interview at British Transport Hotels. McCulloch worked hard. He learned from one of the best, Reo Stakis, and worked alongside one of the best, Donald Macdonald, and succeeded at a young age. By 23, he was a general manager; by 25, he was trying to buy his own business.
He got there. Eventually. In 1976, aged 28, he bought his first independent business – Charlie Parker’s restaurant. It became an institution in Glasgow, the first of many for McCulloch. After Charlie’s came The Buttery, and after The Buttery, Rogano.
Then, in 1986, his first hotel, One Devonshire Gardens – Scotland’s first boutique hotel.
After establishing One Devonshire Gardens as one of Scotland’s greatest hotels, with an award-winning restaurant featuring Michelin-starred chefs, McCulloch decided there was a service to be provided for those guests who couldn’t quite afford that level of luxury but still wanted a quality experience.
So, in 1994, Malmaison Hotels was formed. It was the first launch of a hotel brand for 30 years. The business was sold just two years later to Patriot America for £157m.
But McCulloch did not stop. By 2000, in partnership with F1 driver David Coulthard and US property developer Peter Morris, he opened the five-star Columbus Hotel in Monaco.
Relations soured after some false allegations and McCulloch exited the business, selling his share for around £4.4m in 2007. McCulloch and Coulthard were also partners in Dakota, the first of which had opened in Nottingham in 2004. Two more sites followed – at Eurocentral business park in Glasgow and Forth Bridge in Edinburgh. Nottingham was sold in 2008 as a result of the Columbus fall out. The others remain.
“Dakota is 10 years old now,” says McCulloch. “It has been very successful, but the city centre market is a very different market.”
Not unusually for a “genuine entrepreneur”, McCulloch has big ambitions for Dakota Deluxe. But with long-term partner Evans Property Group onboard in a more official capacity, he is confident of success.
“We have been in partnership with Evans for 10 years, but it wasn’t until last year that they said they wanted to be more a part of what we do,” says McCulloch. “It means we can go for sites we like without having to worry too much about where the money is coming from.”
And those sites will include all of the UK’s major cities, with the first stop in Evans’ stomping ground of Leeds. The Leeds Dakota Deluxe was once a multi-storey car park on the corner of Russell Street and Greek Street in the city centre. The new hotel will feature 90 bedrooms and is due to open later this year or in early 2017.
McCulloch has set a target of opening at least five more Deluxe hotels over the next five years and will initially be targeting sites in Birmingham, Bristol, Cambridge, Cardiff, Manchester and Oxford. Sites will typically be around 50,000 sq ft, providing space for around 100 bedrooms.
“It’s about time that people realised that cities need a reason to be visited,” says McCulloch on his new venture. “Hotels can be a huge part of what makes a city tick.” McCulloch is a big believer in hotel-led regeneration. “Hotels are not just hotels,” he says. “You have an opportunity to create something destinational.”
For him, being able to create a destination comes from looking at sites that others may have dismissed, but looking at them in a different way.
“We started [10 years ago with Dakota] looking at areas where agents feared to tread – Eurocentral Park in Glasgow and Forth Bridge in Edinburgh.
“But I regarded them as opportunities as all the road structures were there,” he says.
McCulloch believes that the Dakota at Eurocentral has helped turn it into a £440m business park and that the hotel at Forth Bridge has spawned its now-sizeable residential element.
For Dakota Deluxe, it will be less about driving further development and more about driving more people to city centres, putting the UK’s cities back on the map, and making Dakota Deluxe a destination within that.
The hotels will be designed by McCulloch’s wife, award-winning interior designer Amanda Rosa, and feature
her signature look of bare walls and luxurious textures – think walnut, velvet, leather in dark chocolates, modern greys and creams.
While the pure Dakota brand was identifiable by its striking black granite exteriors, the Deluxes will have more of a New York vibe, with Manhattan loft-style windows.
And as with all McCulloch’s venues, dining will play a major part in the hotel offering. “The restaurant is the heart and soul of the hotel,” says McCulloch.
He explains that for corporate guests – the sort that he expects at the new city centre – an excellent in-house restaurant is key.
“We are guest-focused,” he says. “We are aware of why people come and stay with us. We don’t have a formula. We do what we do, but we do it with a big heart.”
For McCulloch, it is the little changes that make the big difference.
Back in the 1990s, it was putting CD players in rooms; in the 2000s, it was plasma TVs and broadband; today. it is Bluetooth, 300 thread-count cotton linens and bespoke toiletries.
“We want to make it a bit better every day,” says McCulloch. “I’ve not really changed a thing in 10 years, they’ve just been topped up. Every day.”
And although the Dakota brand – which before the financial crisis had £150m of backing from Royal Bank of Scotland and HBOS – has failed to meet its early ambitions of having as many as 50 hotels across the UK and 100 across the US, the backing of the privately wealthy Evans Property Group (the last Estates Gazette Rich List valued the Evans family at £350m), should put Deluxe on a more steady path.
But McCulloch has been around long enough to know that no journey is without its bumps.
“You’ve got to love hotels,” he says. “It’s a tough career.”
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