HES Group expands in Miami and beyond

MIAMI—HES Group, which currently operates two hotels here, its home base, with two more on the way, got its start by chance around 20 years ago. Venezuelan lawyer Francisco Arocha, along with his partners, acquired the InterContinental Tamanaco Caracas in his home country.

“At the time, it was simply a business opportunity among colleagues, but it soon became our calling. We operated the hotel for about seven years,” said Arocha, who serves as CEO/managing partner. “In 2011, we moved operations to Miami and started our first project in the city, Aloft Miami – Brickell. Later, we decided to expand toward the Caribbean and are currently exploring other markets.”

The Miami portfolio will soon grow to four. Already open is another Aloft, the Aloft Coral Gables, located less than five miles from its sister property. The Hotel Indigo Miami Brickell is scheduled to open in August barring possible delays due to the coronavirus.

“Miami has become one of the most important cities, not only in the U.S., but also worldwide. It’s a city that has been growing and continues to grow in all directions and in all areas of business,” noted Arocha. “Miami is also a place where cultures come together. As a Latin America-born company, it was the perfect place for us to get started: a city with American standards of excellence and innovation with a Latino personality and flavor.”

The fourth Miami hotel, expected to break ground at the end of the year, is the Triptych Miami Design District, the first property in what Arocha said would be a brand for his company. It will be a 297-key lifestyle hotel within a mixed-use property that will feature retail establishments on the ground floor.

“The project will have a very significant F&B component, and we are currently developing important alliances with prominent partners that will help us shape it,” said Arocha. “It will be a  property as unique as its neighborhood; a forward-thinking collective of creative high-tech meeting and function spaces; and a hip lifestyle hotel that will function as a multispace venue with artistic vibes that transmit the culture of the town and our own group.”

The last piece of the portfolio puzzle is the Embassy Suites by Hilton Santo Domingo in the Dominican Republic, which HES owns and operates. Arocha called it “one of the most iconic buildings and most eye-catching hotels of the Dominican Republic.”

“As we started to grow, we began to explore different markets to expand to, and we have been seriously considering projects in Spain and Latin America. We believe that with our Latin American background and North American experience, we provide an added value for the hotel industry in these regions. That is why we are growing outward toward these regions and not toward the U.S.,” he said. “As we made this decision, an amazing opportunity came up to acquire the Embassy Suites Santo Domingo, an architectural landmark and the tallest building in the city.”

He continued, “We evaluated the opportunity and decided it was a great place to begin our expansion due to the country’s significant economic growth in recent years and all of the benefits for foreign investors. The hotel is a key spot for business travelers due to its location and meeting spaces. At the moment, we are fully operating the hotel with plans to remodel and relaunch it in the near future.”

The executive noted that business had been doing well in the first couple of months this year. Super Bowl LIV in Miami Gardens in February provided a big boost to the Miami properties as they approached their high season in the spring. But then, the coronavirus crisis “pulled the rug out from under all of us,” he said.

“Our first step has been trying to fully understand the magnitude of the global crisis we are facing and what we can expect from it,” he said. “Our top priority is to keep our employees and guests safe. Since we currently only operate franchised hotels, we follow along the instructions, not only of government officials, but of our hotel chain partners, which have been the public face of the hotel industry during this critical time.

“However, Miami is no stranger to catastrophe,” he continued. “The city has a prominent hurricane season that has [caused] critical states of alarm and often tragic devastation. Miami has developed the ability to recover quickly and go back to normal swiftly. I believe the fact that most of our hotels are located in Miami means that we will be one of the first ones to recover and resume our business.”

Outside of hotels, HES Group also operates a baseball team. Los Tiburones de la Guaira is a member of the Venezuela Professional Baseball League, which is an affiliate of Major League Baseball.

“Our involvement in baseball was a happy coincidence. We started investing in the hotel industry in Venezuela with the InterContinental Tamanaco Caracas, and we were presented with the opportunity to participate in the acquisition and relaunch of Los Tiburones de la Guaira,” Arocha said. “Baseball is the most important sport in Venezuela. There are eight teams in the country’s league and baseball season is a highlight for everybody, loyal fans or not. When we bought the team, we immediately became a part of the big, worldwide baseball family, which is one of the most prestigious institutions in the U.S and the world.”

Coming up next for HES Group is the formation of Aradel Capital, which, Arocha said, “will sponsor investments in the hospitality industry, creating a strategy that focuses on the company’s track record as specialists in this area. With teams that have the knowledge to transform the investments into results, the group is actively pursuing a growth strategy with plans to invest in the U.S. and abroad, and with expansion plans into other industries.”