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					Profile Jose Mari Del Rosario




Microtel’s
Macro Plan
By Lizza Guerrero Nakpil




                                30 WEALTH
            Developer Jose Mari
            del Rosario chooses
            between single
            mega-development
            in an overbuilt
            metropolis and
            multiple projects
            in little known
            locations.




        I   I      n a country where nothing is
            what it seems, Jose Mari del Rosario is,
            at first glance, the unlikeliest member
            of the Philippines’ new generation of
            entrepreneurs. Courtly and soft-spoken,
            del Rosario has the patina of a contented,
            gentleman-farmer. And his choice of
            meeting-place—the old-world Manila
            Polo Club’s ‘Cogon Village’, a cluster
            of quaint, thatched-roofed table huts
            overlooking the green expanse of polo
            fields—couldn’t be farthest from the hustle
            and bustle of new-economy twitter that
            the usual, flashy entrepreneur adores.
               Del Rosario, from all appearances, is the
            last person you would imagine flying in
            the face of conventional wisdom, family
            counsel and, by his own accounts, even his
            personal experience—to take that leap of
            faith required in the boldest and brightest
            of entrepreneurs.
               In just under a decade, his Microtel Inns
            & Suites Philippine franchise has spread
            an impressive PhP1.2B (or US$25.5m)
            in fresh tourism infrastructure across the
            country—perhaps single-handedly doing
            more than any government programme
            to boost local economy and domestic
            tourism.
               But more than mere bean-counting, or
            plunging into the new and unexpected,
            del Rosario’s personal brand of

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Profile Jose Mari Del Rosario




entrepreneurship has an important
dimension—for a country sorely in need            “Competitive airfares from the Philippines’
of it. It is, in his matter-of-fact words, “the
agenda of nation-building”.                       new budget carriers make it easier to
   It’s a refreshing perspective from
a member of the “me” generation                   travel around the country, as do our
and is the subtle undertone of his
corporate vision. (Truth be told,                 burgeoning ‘nautical highway’, so you can
that same philosophy lies behind the
blueprint of every tiger economy: that
                                                  travel the Philippines’ islands literally by
love of country is the best engine for
development.) In short, this is what
                                                       ”
                                                  road, he says. “People are now saying
makes del Rosario a ‘man with a view’.
   His weapon of choice—the harnessing
                                                  to themselves, ‘Let’s see what our
of Filipino ingenuity at management               country has to offer’ before planning a trip
expertise—is something he literally
learned at the knee of one of the most            overseas. ”




                                                                                        Mactan Facade


                                                         32 WEALTH
                                                                                                                            Mactan Suite



iconic businessmen of his generation,           50 per cent of Microtel Inns outside its      so you can travel the Philippines’ islands
Ambassador Ramon V. del Rosario Sr.,            mother country, the US; and is certainly      literally by road,” he says. “People are now
founder of the Phlippine Management             the fastest-growing franchise in its global   saying to themselves, ‘Let’s see what our
Investment (Phinma) Group, (ranked              portfolio, opening one hotel per year since   country has to offer’ before planning a
as one of the country’s largest corpo-          it was founded.                               trip overseas”.
rations, with aggregate assets and                 As a result, del Rosario was named            “The Philippines”, says del Rosario with
capitalization estimated at PhP8b or            ‘International Developer of the Year’         a sardonic smile, “is always in a perennial
US$170m.)                                       in 2006 by Microtel (then owned by            state of crisis. There’s always some sort
   It is that precise model that del Rosario    Hyatt Global).                                of upheaval, natural or man-made. It’s
has harnessed to create the top ‘middle-           And with just the slightest hint of a      nothing new and we’ve learned to roll
market’ hotel in the Philppines today           grin, del Rosario shrugs off the global       with the punches.”
—decisively filling the vacuum in that          downturn barreling across continents,
critical category, lauded by no less than       hitting hardest at Asian tourist              The Third Generation
the Philippines’ Department of Tourism          destinations. “Our focus is primarily on      In keeping with their father’s trademark
Secretary Ace Durano.                           domestic demand.” del Rosario explains.       dedication to the cult of the ‘professional
   Microtel Inns & Suites Philippines,             “Competitive airfares from the             manager’, none of the del Rosario
whose p.c. appellation is the ‘limited          Philippines’ new budget carriers make         children were presumed to have a
service’ hotel for travellers looking for the   it easier to travel around the country, as    hereditary right to a place in the Phinma
best value for money, account for the           do our burgeoning ‘nautical highway’,         firmament.

                                                               33 WEALTH
 Profile Jose Mari Del Rosario




Family dinners
were part-lecture,
part-workshop,
where “every topic
under the sun
was discussed
and analyzed
—from politics
to economics,
business strategy
and relationships
                      .
that are built to last”
   Del Rosario says, however, that as the
youngest son—he had perhaps the best
vantage view of the legendary del Rosario
patriarch in action. Family dinners were
part-lecture, part-workshop, where “every
topic under the sun was discussed and
analyzed—from politics to economics,
business strategy and relationships that are
built to last”.
   He says he was lucky that he was
growing up at the time when the elder del
Rosario “had slowed down a tad” and had
been appointed ambassador to Canada,
Japan and Germany.
   It was this globetrotting milieu that set    Manila Hotel was handed down, however,        kinds of commercial infrastructure, such
the course for del Rosario’s own interest       del Rosario decided it was time to take his   as malls, residential condominiums and
in the world of hotel management. Del           long overdue graduate studies at Cornell      even airports.
Rosario specialised in the field—rising, in     University.                                      A meeting with Microtel Director
a parallel course, to be the country’s first      Del Rosario credits his post-grad studies   for International Development, Charlie
Filipino general manager of a five-star         with rounding out his perspective. “When      Perreira, was pure serendipity. His older
hotel in the same way that the elder del        you work in a ‘grand hotel’, you tend to      brother, Juan Miguel—always on the
Rosario had become the first Filipino           develop a guest-centric mindset, which is     lookout for business ideas to pitch to his
CEO of an American multinational.               only one part of the equation if you want     youngest brother—said he had chanced
   That five-star hotel was the ‘grande         to be serious about running a hotel. You      on a novel hotel called Microtel.
dame’ of Philippine hotels, Manila Hotel,       need to understand finance, marketing,           Del Rosario, on an impulse, decided
which dates back to 1912 and residence          organisational development and strategy.”     to fly out from New York (where he was
of choice for visiting royals, heads of state     His father encouraged his move—             then based) to Microtel headquarters
and persons of note.                            envisioning a career in property              in Atlanta, Georgia. He arrived in a
   When the decision to privatise the           management of not just hotels, but all        pin-striped suit and tie. “The first thing

                                                               34 WEALTH
                                                                                                 He also maximised the advantages
                                                                                              of out-sourcing. “Running a hotel is
                                                                                              usually like running a small city: you
                                                                                              have to put up a restaurant, and therefore
                                                                                              a kitchen, set up laundry, security and
                                                                                              transport services. There is none of that
                                                                                              for us—instead, Microtel contributes
                                                                                              to the local economies by creating more
                                                                                              jobs and business opportunities for the
                                                                                              communities. Staff to guest ratios are
                                                                                              therefore highly efficient.” It’s a powerful,
                                                                                              no-nonsense model that works and
                                                                                              has been consistently ranked by the
                                                                                              respected market research firm JD Power
                                                                                              & Associates as “the highest in customer
                                                                                              satisfaction in the field of ‘limited service’
                                                                                              hotels” in the world.
                                                                                                 As a result, hotel room rates are highly
                                                                                              accessible, from as little as US$35 to
                                                                                              US$70; and hotel sizes are typically
                                                                                              between 50 to 150 rooms.
                                                                                                 Del Rosario next set about finding the
                                                                  Davao double bed enhanced
                                                                                              ideal “like-minded” partners, making
                                                                                              presentations on what he described
                                                                                              were “just sheaves of photographs and
Perreira told me was to take off my tie,”       options for any kind of traveller—the         drawings” and his own art of persuasion.
he said with a laugh. “He said, we don’t        glittering five-star hotels of Metro             Lady luck—or rather, President Cory
believe in those things down here.”             Manila and at the other extreme,              Aquino, would give him the impetus
   It was del Rosario’s first taste of the      battered, poorly-equipped hostels. (The       for his first project. The Aquino family
unconventional, down-to-earth style of          total number of Philippine Tourism            —who are originally from Tarlac, which
the Microtel culture. And the chemistry         Department-accredited hotel rooms is          is the crossroads for both Central and
was instant.                                    still only a meagre 32,000 across the         Northern Luzon, (the Philippines’ largest
   “There was just such an atmosphere of        country.) “The market was screaming for       and most prosperous island) was intent
openness and trust,” recalls del Rosario.       a place to stay that was decent, safe, and    on building a Ninoy Aquino museum as
   Perreira walked him through the              comfortable,” del Rosario says.               well as convention center on the family’s
business and its vision, instantly winning                                                    Hacienda Luisita. Microtel was the
del Rosario over. In a cruel twist of fate,     The Microtel Model                            necessary finishing touch.
however, the Asian financial crisis of 1997     Enter the Microtel model, whose motto is:        Over the next few years, del Rosario,
had descended on the Philippines, and the       “The same great hotel everywhere you go.”     building from one success to another,
project was given the thumbs-down by his           The Microtel mission was to offer          attracted a “who’s who” in Philippine
father. “It felt as if the cheque had been      travellers consistent standards in            business to participate in his venture: the
issued and was snatched from my hand,”          facilities that are taken for granted         Lopezes, owner of the country’s largest
del Rosario exclaims.                           in the Western world: “decent beds,           broadcast conglomerate, partnered with
   Again, taking a page from his father’s       hot showers, cable TV and IDD/                Microtel in tandem with the launch of
own book, del Rosario persuaded private         NDD to keep you connected, and                First Philippines Holdings’ industrial park
investors from within the family to back        a computerised reservations system            in Batangas; the Hernadezes of Victory
his business idea. “I was just too stubborn     that can make multiple travel                 Liner, the country’s biggest bus company,
to give up,” he says.                           arrangements—instead of hunting for a         allied with Microtel to create locations in
   The next step, del Rosario relates, was to   different place everywhere you go.”           Baguio, Cabanatuan and Puerto Princesa;
find suitable sites—destinations that were         Each hotel had to be built from the        as did the family of the Philippine
not traditional Philippine tourist sites but    ground up, “no conversions from old           ‘banana king’ Antonio Floirendo in
“melting pots for regional business”.           buildings or discarded motels,” del           Davao and the Benedictos of Cebu.
   A decade ago, there were only two            Rosario emphasises.                              Each hotel left a solid mark, with

                                                               35 WEALTH
Profile Jose Mari Del Rosario




occupancy rates going as high as 85 per
cent in some locations (55 per cent is
                                               Del Rosario looks most fondly at the
the system average), others requiring the
construction of additional rooms.
                                               outreach programs for the communities
   In 2006, Microtel became an official        in which Microtel is located: re-painting
member of the Phinma Group, after
passing an arduous review process by           schoolhouses, organising medical missions
the board. “It was like being attacked
by porcupines on all sides! I had to go        and giving practical training to hospitality
through hours of intense review and
questioning to meet my father’s very           students in nearby colleges.
strict criteria.”
   Microtel International, in its
own right, has attracted its share of
international attention—growing from
a small, regional player in upstate New
York to a pet project of the legendary
Mike Leven, former president of
Holiday Inn and Days Inn; passing it
on to the Pritzker family, better known
as the name behind the Hyatt brand,
and from thence to the Wyndham
Corporation, the world’s largest hotel
franchising company.

Socially Committed
While the Phinma Group has established
myriad foundations, del Rosario looks
most fondly at the outreach programs
for the communities in which Microtel
is located: re-painting schoolhouses,
organising medical missions, giving
practical training to hospitality students
in nearby colleges. He has also adapted
‘green’ policies in Microtel properties such
as using solar panels to power the hotels’                                                                              Baguio archery
water heaters.
   What lies ahead? “Tourism is a
mindset,” says Jose Mari, “and Filipinos       and economic development. It makes          facing Manila Bay. (Two more will
must realise that it is an important           it easy for people to move around,          also have begun construction south of
national revenue source, as Spain,             make connections and ultimately,            Manila.) A self-confessed “masochist”,
Singapore and Thailand have shown.             do business. The question is, do you        del Rosario has set his sights on a hotel
   “The Philippines has reached 3              build a single, billion-peso, de luxe       in every single one of the Philippines’ 73
million arrivals per year. Can you             hotel in an overbuilt city or 10 smaller,   provinces. (Today, Microtel Philippines
imagine if we could come close to the          but strategically placed, ones all over     may be found in Baguio, Tarlac, Nueva
60 million tourists Spain attracts? The        the Philippines? I feel that bite-size      Ecija, Batangas, Cavite, Boracay, Cebu,
total tourist spend in 2008 was an             investments are the way to go—and that      Davao and Palawan.)
estimated US$5b in the Philippines.            countryside destinations are the future.”      He is also set to open a new chain, the
Spain had US$50b. Our potential                   By the time this article sees print,     Hawthorn Suites, geared for the longer-
to become a world-class tourist                Microtel Philippines will have opened       staying traveller.
destination is enormous.                       its ninth and 10th hotel, including the        “I just can’t get no satisfaction,”
   “Hotel building is one of the most          first in the region’s largest square-area   he says with a smile. “There’s always
cost-effective ways to boost tourism           commercial center, The Mall of Asia         something more to do.”

                                                              36 WEALTH
                                                                                                                                      Jose Mari del Rosario
Historical Determinism
Jose Mari del Rosario’s equanimity is the product     Rosario Sr. quickly became the stuff of legend.      Business”; and in Time, who dubbed him “Mr.
of four generations’ intrepid adventures that, only   The first Filipino to be sent off for management     Five-Year Plan” in 1962.
upon closer inspection, reveal themselves in an       training at IBM New York’s head office, he also          First established to attract international and
occasional glint of his eyes.                         became its first Filipino general manager upon       Filipino financing to manufacturing, Phinma has
The first Don Antonio Vivencio del Rosario (1828-     the declaration of WWII.                             since spread its wings far and wide. Its interests
1884) was one of the first doctors of law from           He was among the first to heed the call of        today include two publicly listed companies:
Manila’s University of Santo Tomas, an ‘alcalde       then-Philippine President Carlos P. Garcia in his    Bacnotan Consolidated (which, pre-Asian crisis,
mayor’ (governor-magistrate) who served on            “Filipino First” policy in the 1950s.                controlled 50 per cent of cement production
the Real Audiencia (the highest tribunal of the          He drew a lifetime inspiration that would also    in the Philippines), Trans-Asia Oil & Mineral
Spanish crown in the East Indies).                    fuel his family when he was asked to join Philam     Development Corp. (the first company to find
    Don Antonio’s sons Salvador and Mariano,          Life Insurance. Earl Carroll, then the American      and develop oil in the Philippines), as well as
del Rosario’s grandfather and granduncle              president of the company, put it simply to him:      three power-generation plants and a slew of
respectively, completed their education in            Would you rather sell business machines or           universities across the country. Affordably
Madrid where they fell into the company of            help build a country? The choice was obvious.        priced housing and out-sourced animation are
Filipino intellectuals lobbying for a seat in the     It meant mobilizing people’s savings to create       newer ventures for this behemoth.
Spanish parliament.                                   a river of capital to infuse into factories, build       “What Phinma did was to organise companies
    The brothers supported incendiary newspaper       infrastructure and create jobs, del Rosario says.    and put together capital, creating industries
La Solidaridad—a feat they would repeat upon             Before long, del Rosario senior struck out        where none existed before, captained by
their return during the Philippine Revolution of      on his own, setting up the DRB Marketing             experienced managers. My father was a pioneer
1896 and well into the Philippine-American War.       Corporation, assembling and retailing appliances     of entrepreneurship, portfolio diversification
Salvador edited the country’s wildly popular,         under license from General Electric and              and good corporate governance,” explains del
radical newspaper La Independencia.                   International Harvester.                             Rosario. (Today, Phinma is run by chairman
    Half a century later, after the Secopnd World        He also established the Philippines’ first oil    Oscar Hilado and del Rosario’s oldest brother,
War, del Rosario’s father would have to grapple       refining and marketing company, FilOil, which        Ramon R. del Rosario Jr.)
for survival in Manila, a city that had suffered      earned him the attention of Fortune in 1959,             In a microcosm, it is the same template
more destruction than Warsaw. But Ramon V. del        with a profile in the “Who’s Who in Foreign          Microtel Philippines follows today.



                                                                        37 WEALTH

				
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