Hammons Ups The All Suites Ante, Adds More Properties

John Q. Hammons Hotels & Resorts last month began construction on two Embassy Suites Hotels—totaling 610 suites scheduled to open in early 2006—adding to the four Embassy Suites properties, comprising 1,150 suites, that Hammons plans to open in 2005.

All suites properties account for a significant majority of owner-operator Hammons' construction pipeline. Of a portfolio of 60 properties nationwide, many in secondary and tertiary locations, one-third are all suites. The remainder is a mix of traditional full service, midprice and extended stay brands.

Hammons' commitment to all suites hotels reflects the concept's flexibility. "It gives a business client the opportunity to have two completely separate rooms and that price-value supposition is as valid in good times as well as bad," said Scott Tarwater, senior vice president of the Springfield, Mo.-based company. "People perceived it as a good value in the downturn, and they continue to perceive it that way now. When we develop hotel rooms with business travelers in mind, whenever possible we want to give them the opportunity to close off the parlor area, so they can conduct interviews, business meetings or product displays and use it as an office in other ways."

Guest satisfaction scores for all suites products typically run higher than scores at traditional business hotels, Tarwater added.

Hammons also has pioneered the use of all suites properties as convention hotels. "One of our projects currently coming out of the ground in St. Charles, Mo., is attached to a 175,000-sq.-ft. convention center. Another in Hampton, Va., is attached to a 360,000-sq.-ft. center," Tarwater said. "The suite configuration in the context of a convention hotel isn't traditional, but makes sense since business travelers attending a convention may have to use the second part of the suite for a small, impromptu business meeting. Attendees may need to meet with customers or suppliers, for example, or even employees who are running a booth during a trade show."

Unlike typical all suites hotels, those adjacent to or adjoining a convention center are more likely to have dedicated meeting space of their own. The St. Charles property, for example, has an additional 52,000 square feet of space in the hotel itself. This allows the hotel to host more formal meetings and those too large to be accommodated in the parlor portion of a suite.

Brand managers of such all suites chains as Embassy Suites, which is part of Hilton Hotels Corp., SpringHill Suites by Marriott and Prime Hospitality's AmeriSuites agreed that their brands represent a distinct lodging niche. First and foremost, they stressed the all suites product's value for price in terms of extra space. However, they also were aware that their non-suite competitors—whether full service, midprice or extended stay—have been busy adding amenities popular with business travelers, such as high-speed Internet and food and beverage on demand. Not wanting to lose any competitive edge, all suites chains have responded by launching their own initiatives in these areas.

"The whole industry has been moving to high-speed Internet access," said David Greydanus, Embassy Suites senior vice president for brand management. "Consequently, we're rolling out high-speed in all of our hotels. As of June 30, we have 100 percent coverage of guest rooms, public space and meeting rooms. The solution might be wired or wireless, depending on the property specifications. That means high-speed Internet is in every room of every hotel, unlike many brands, in which it's still only available in portions of the hotel."

Embassy Suites gives hotels flexibility in pricing high-speed Internet services, depending on market conditions. "Generally, we charge," Greydanus said. "We established a brand standard that allows hotels to charge no more than $9.95 a day. However, they can charge less than that, down to nothing, depending on their market situation. Regardless of the price charged, guests also get access to a 24-hour toll-free help desk for technical questions."

Likewise, AmeriSuites—in the midprice without food and beverage category—recently installed high-speed Internet access in every room at a charge to guests. "There hasn't been any resistance to the charge as of yet, but we'll keep our eyes on the competition and watch what the market is doing," a brand spokesperson said

By contrast, SpringHill Suites, which also is in the midprice without food and beverage sector, this year made complimentary high-speed Internet a brand standard. "It was a matter of making sure we have the right service offerings to meet our core traveler's needs," said Chad Waetzig, Marriott senior vice president for select service brand management. "For business travelers, the availability of complimentary high-speed Internet was the largest unmet need we saw in our research."

Rather than develop an actual convenience store outlet to give travelers access to food and beverage the way some midprice brands have done, Embassy Suites this year began testing a self-service kiosk concept that provides guests with many of the same options. "Guests have told us they want access to food and beverage on a 24-hour basis. In response, we're developed the kiosk, which we call MarketStreat. We're actually seeing it as a possible substitute for room service," Greydanus said. "It offers fresh food items that guests can take to their rooms, eat in the public areas of the hotel or even take with them on their way out of the building." MarketStreat initially was tested in San Antonio and another test began last month in a second primarily business travel destination, Memphis. To get a sense of how the concept is received in a resort destination, the next test will be conducted in San Juan, Puerto Rico. No date has been set for a national rollout.

According to Hammons' Tarwater, business travelers in particular appreciate the flexibility that comes with Embassy Suites' existing complimentary breakfast, which is a systemwide standard. "When they go down for breakfast, they can grab a quick cup of coffee and a roll and take off for appointments, if they choose. If, on the other hand, they have more time and want a full cooked-to-order breakfast, they can get that as well. It's their decision," he said.

Hammons' customer research indicated that business travelers who prefer the all suites concept value this kind of flexibility. "They want the freedom to use the second room as an office or just as additional space in which to relax," Tarwater said. "They enjoy being in control of their own experience."