Evolution of Multi-Branded Hotels

By Lawrence Adams Principal, ForrestPerkins | November 04, 2018

Not long ago I coauthored a book published in 2012 titled Hotel Design Planning and Development, Second Edition with Richard Penner and Stephani Robson in which I wrote a chapter on Multi-branded hotels. In that chapter I described one of the newest trends in hotel development, a unique new product, that has since evolved into a significant hotel type with unique characteristics, advantages and challenges. In this article we will look at this relatively new product, how it is being developed today and what the prospects are for future development.

Hotel developers are realizing financial, marketing and operational advantages of building more than one brand on a single site and in many cases sharing a single building. Multi-branded hotel developments usually share back-of-house operations, administration, staff, recreational facilities and meeting rooms, but in order to maintain brand recognition and foster brand loyalty, they most often have separate entrances, separate lobbies and individual architecture and decor corresponding to each one's particular brand standards.

Often driven by high land values and limited availability of suitable sites, multi-branded hotel projects obtain efficiencies in construction through shared facilities resulting in a lower cost per room saving as much as 30 percent on development costs. Operational costs are also reduced through centralized management, staff and services. Cross selling is another advantage for hotel companies as guests staying in one brand get meaningful exposure to an unfamiliar new brand. But there are challenges that must be overcome to realize these advantages as we will review in this article.

AccorHotels is credited with pioneering the first dual-branded hotel in 1984 in Paris with the Ibis/Novotel hotels in the La Defense business district by repositioning an underperforming 600-room hotel in order to target separate price points with two brand names. Marriott first introduced the concept in the United States with the 988-room Orlando JW Marriott collocated with a 584-room Ritz Carlton in 2003. It wasn't until 2007 that Hilton joined the fray with the Homewood Suites and Hilton Garden Inn hotels in Baltimore. Then Marriott followed AccorHotels' lead in Europe in 2011 with the Courtyard/Residence Inn in Munich.

Types of Multi-Branded Hotels

Multi-branded hotels come in a variety of configurations. Early examples of multi-branding involved two distinct buildings that were in close proximity or on the same lot, but were essentially two distinct hotel buildings that may have shared administration, staff facilities and some back of house functions. But by not being conjoined did not achieve the efficiencies afforded by ones physically connected.

The dual-branded Homewood Suites and Hilton Garden Inn hotels in Bossier City, Louisiana
Shown at the far right, as part of The Wharf in Washington DC, The Canopy Hotel by Hilton and the Hyatt House Hotel
Marriott Place in Indianapolis is a multi-branded property containing four hotels in one block and connected via sky-bridge to a fifth Marriott hotel
/ SLIDES
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Coming up in March 2019...

Human Resources: An Era of Transition

Traditionally, the human resource department administers five key areas within a hotel operation - compliance, compensation and benefits, organizational dynamics, selection and retention, and training and development. However, HR professionals are also presently involved in culture-building activities, as well as implementing new employee on-boarding practices and engagement initiatives. As a result, HR professionals have been elevated to senior leadership status, creating value and profit within their organization. Still, they continue to face some intractable issues, including a shrinking talent pool and the need to recruit top-notch employees who are empowered to provide outstanding customer service. In order to attract top-tier talent, one option is to take advantage of recruitment opportunities offered through colleges and universities, especially if they have a hospitality major. This pool of prospective employees is likely to be better educated and more enthusiastic than walk-in hires. Also, once hired, there could be additional training and development opportunities that stem from an association with a college or university. Continuing education courses, business conferences, seminars and online instruction - all can be a valuable source of employee development opportunities. In addition to meeting recruitment demands in the present, HR professionals must also be forward-thinking, anticipating the skills that will be needed in the future to meet guest expectations. One such skill that is becoming increasingly valued is “resilience”, the ability to “go with the flow” and not become overwhelmed by the disruptive influences  of change and reinvention. In an era of transition—new technologies, expanding markets, consolidation of brands and businesses, and modifications in people's values and lifestyles - the capacity to remain flexible, nimble and resilient is a valuable skill to possess. The March Hotel Business Review will examine some of the strategies that HR professionals are employing to ensure that their hotel operations continue to thrive.