Pipeline shifting from Conversion to New Construction Activity
Phoenix, Arizona, USA – 22 October 2014 – Momentum for new hotel development continues to build at Choice Hotels International, one of the world’s leading hotel companies. At the 20th annual Lodging Conference, the company heralded several initiatives driving interest in new construction for Choice branded hotels. The growing volume of these projects is multi-faceted – mainly driven by the ongoing success of the Comfort brand’s transformation, a new dual-brand lodging concept and the broad appeal of the Ascend Hotel Collection brand, the company’s portfolio of upscale independent hotels.
“We are reaping rewards from a strategic synchronization of events. An extremely favorable market for lodging investment, pent up demand for new supply in the right markets and proven brand strategies are driving development in a big way,” said Stephen P. Joyce, president and CEO of Choice Hotels International. “The confluence of all of this has Choice Hotels well positioned for even more compelling growth. The aggressive plan behind our reinvigorated Comfort brand includes accelerating improved product and performance for existing properties and unprecedented new construction incentives. Developers are also excited by our dual-brand concept and the success of the Ascend Hotel Collection network, which has evolved to include new construction projects in urban markets with tight site constraints that limit the appeal of typical hotel brands.”
REINVIGORATED COMFORT BRAND DRIVES NEW CONSTRUCTION INTEREST
As part of a comprehensive strategy to reintroduce the new and improved Comfort brand to developers and consumers, the existing Comfort portfolio embarked on extensive product upgrades. Since the initiative was launched more than $250M in product improvements have been made, including Choice’s investment of $40M to help fund these renovations. Simultaneously, Choice created a new contemporary prototype, designed in collaboration with renowned architecture firm Gensler, which offers developers an attractive new build option at the right time when many markets are ripe for development. Recent agreements in key business and leisure destinations such as Denver, Philadelphia, Pittsburgh and Ft. Lauderdale are spearheading the Comfort brands new construction growth.
“Lodging developers and investors are pleased by the strategies we are executing to improve portfolio quality and deliver more guests to our hotels. They know the great benefits of working with an innovative company like Choice Hotels and want to be a part of it,” said David Pepper, senior vice president of global development for Choice Hotels International. “Additionally, the announcement earlier this year of attractive incentive options has resulted in a surge of new construction activity for the Comfort brand. The timing of these incentives and strategic initiatives for the Comfort brand is perfect.”
DUAL APPEAL WITH DEVELOPERS
Developers are also eager to construct Choice’s new, innovative dual-brand concept for the MainStay Suites and Sleep Inn brands. The strong appeal of these projects includes construction efficiencies, operational productivity through shared staff and facilities, as well as the ability to tap into diverse customer bases. This allows developers to capitalize on several travel market demands — business, leisure, transient and extended stay – all under one roof.
The dual brand concept has gained traction with well-established players in the business community including Love’s Hospitality, the hotel division of travel center conglomerate Love’s Travel Stops & Country Stores. Love’s operates more than 300 travel centers in 39 states, generating more than $26 billion annually. The family-owned business, which in 2013 Forbes ranked as the 9th largest privately held company, recently executed multiple agreements to build new hotels, including dual-brand projects in Georgia and Colorado.
ASCEND TRANSCENDS ORIGINAL MODEL
The Ascend Hotel Collection network, a pioneer in soft branding, is also experiencing tremendous success and growth. When it was first conceived, the primary focus of the Ascend brand was to attract existing upscale independent hotels with the power of Choice Hotels. Having now reached 128 hotels worldwide, Ascend is now expanding further by adding new construction projects to the portfolio, including several in New York City. Developers with the appetite to build a uniquely designed property can gain access to the reservations and support system of one of the world’s largest hotel companies and still offer a fresh product to the market.