Paul Korian

Weston Town Crier, MA
July 28 2005

Moving Marriott across the GLOBE

By Cheryl Balian Scaparrotta / Correspondent
Thursday, July 28, 2005

In the culmination of an eight-year labor of love, a Weston businessman is helping awaken a sleepy post-communist economy 5,000 miles from home by funding a glamorous new hotel in the former Soviet republic of Armenia.

Paul Korian is managing partner of AK Development, an investor group behind the purchase and multi-million dollar renovation of the Marriott Hotel in Yerevan, Armenia's capital. The nine-story hotel, with 226 guest rooms and four restaurants, is at the heart of the city's cultural and business center.

`The hotel marks a number of firsts,' explained Korian, an Armenian-American who has resided in Weston for eight years. `It's the largest U.S. investment in Armenia, and the first internationally-branded investment in that nation.'

It's probably also the first time that Korian and other private investors, most of whom are also Armenian-Americans from the Boston area, had ever come face-to-face with the stark realities of the communist era.

`During renovation, contractors discovered a secret level in the building, used by KGB agents to monitor listening devices in rooms,' he recalled.

The five-star hotel is housed in a 1950s-era building. While architecturally pleasing, it needed a total renovation to meet international hospitality standards.

The involvement of Marriott, one of the world's best-known hotel operators, added luster and credibility to the project.

`The property itself convinced Marriott to get on board with us,' explained Korian. `They were amazed by its prestigious location.'

The grandiose building, purchased by AK Development from the government for $10 million, sits prominently on Yerevan's Republic Square, center of the capital city. The National Art Gallery is opposite the hotel, and a number of other museums and businesses are within walking distance.

While the structure had always functioned as a hotel, guests experienced few, if any, Western-style amenities. Credit cards were not accepted for payment - wads of cash sufficed - and making outgoing phone calls were difficult at best.

These situations have been rectified, and higher health and safety measures have also been implemented.

`Marriott has been a pioneer in stepping into former communist lands, like Poland,' Korian pointed out.

But challenges of doing business in the former USSR persisted throughout the project. For example, artwork shipments to the hotel were delayed for several weeks because border guards thought they were originals.

Armenia, a mountainous country about the size of Belgium, is a sovereign nation of 3.3 million currently transitioning into a market-based economy.

Located in the Caucasus region at the crossroads of the Old Silk Road between Asia and Europe, it gained independence from the USSR in 1991.

Checking into a homeland opportunity

Korian, a co-founder of Staples, the office superstore [not able to confirm online], had no previous experience as a hotelier. Though he had always been active in the Armenian community, a devastating earthquake that struck Armenia in 1988 prompted him and many others to evaluate more permanent ways to aid their ethnic homeland.

`The opportunity is bringing Western-style business practices to a post-Soviet country,' Korian said.

AK Development was created in 1997 to acquire and restore the hotel, which was offered for sale through Merrill Lynch. Since the 1998 purchase, Korian has traveled back and forth between Weston and Armenia at least 25 times.

Hallmarks of luxury in the new hotel - for which the president of Armenia cut the ceremonial ribbon for -include a fitness center, in-room Internet connectivity, 24-hour room service and a two-story presidential suite fit for visiting heads of state.

Marriott has incorporated the hotel into its worldwide reservations system, sent over a dozen Armenian employees abroad for management training, and installed seasoned company executives in Yerevan.

Katrin Hentszel, the hotel's general manager, has worked for Marriott in Hamburg, Frankfurt and Warsaw. The hotel's director of sales and marketing, Alex Nurock, comes to his new post fresh off a stint at the Riviera Marriott in Monaco.

Korian and Hentszel noted that Armenia is just beginning to market its assets, like its rich history and natural beauty, to a global audience. It was always a tourist destination for those in the Soviet system, and many USSR Olympic athletes trained in its warm summer climate.

In fact, Armenia's famous brandy was said to be a favorite of Winston Churchill.

`The hotel is a catalyst to demonstrate that people from all around the world can enjoy Armenian culture,' emphasized Korian.

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