Hampton Tops Eight Of Ten Midprice W/O F&B Scores
The chains in the three top positions in the midprice without food and beverage category in this year's Top U.S Hotel Chain Survey occupied the top three slots last year, though each was in a different position. Hampton made the significant leap from third place last year to first place this year, making last year's champion, Country Inns & Suites, number two and leaving last year's number-two placeholder, Fairfield Inn by Marriott, in the number-three slot.
The midprice without F&B category this year remained one of the survey's most competitive listings with 10 chains vying for reader commendations. Chains in this segment also are among the industry's fastest-growing. One entrant, La Quinta, was an acquirer during the year, buying Baymont Inns & Suites, while another chain on the list, AmeriSuites, which one year ago was part of Prime Hospitality, in December was acquired by the larger, full-service Hyatt Hotels Corp. While La Quinta currently operates Baymont under the existing name, Hyatt is expected to rebrand AmeriSuites.
Hampton placed first in eight of the 10 criteria that survey respondents were asked to measure, including ease in arranging individual travel, the properties' physical appearance and the overall relation of price to value. Country Inns & Suites received the highest scores for the remaining two criteria: corporate rate programs and commission payment systems.
As a category, midprice without F&B in 2004 posted mixed results. Both the midprice with F&B and midprice without F&B chains delivered some of the industry's strongest results during the downturn. That wasn't the case last year, however. Occupancy levels grew 2.1 percent year over year, according to PricewaterhouseCoopers, just a shade above the 2 percent average increase in occupancy recorded by all U.S. hotels. The category's average daily rate and revenue per available room performance for the year, however, fell below the industry averages. While 2004 ADR for midprice without F&B hotels increased 3 percent from 2003 figures, the industry average was 3.9 percent. RevPAR for the segment jumped a healthy 6.5 percent, but that still was below the even-healthier industry average gain of 7.5 percent.
While the segment's performance may not have been record-breaking, 2004 was a strong year for new property openings and signed agreements for future development. With 1,292 hotels, Hampton, which is part of Hilton Hotels Corp., is more than three times the size of the 334-property Country Inns, which is a brand of Carlson Hotels Worldwide, but both grew in 2004 at a higher than normal rate. "We opened between 65 and 70 hotels last year and expect a similar number to open in 2005," said Phil Cordell, Hampton senior vice president for brand management. "Even more promising, however, is that in 2004 we signed an almost record number of approvals for new hotels." Given the typical 18-to-24-month construction cycle for an approved hotel to open, Cordell expects the number of new openings to spike dramatically in 2006 and 2007.
Country Inns in 2004 opened approximately 30 hotels and signed more than 40 new license agreements, an increase over recent years. "In 2000, the pace of new construction started to decline and 2001 really put a stall on it," according to executive vice president and brand leader Nancy Johnson. "We've been ramping back up each year since then and have begun seeing some significant growth."
Development interest has followed the rebound in the lodging industry. "Confidence is high and financing is available for projects of our size," Cordell said.
Traditionally located in suburbs or along highways, they increasingly have been built in downtown locations. The trend continues in 2005. The first Hampton in Washington, D.C. opens this month. "What's exciting for us is that we've had hotels that ring the D.C. area in the Virginia and Maryland suburbs, but we have not actually been in the District before," Hampton's Cordell said. "Plus, downtown locations serve as a billboard for a brand. For as well-known as you might be from the suburbs, being downtown attracts much more attention."
Other downtown changes are inevitable. "The building itself is likely to be more vertical than horizontal and the décor likely will be different in its nuances," Cordell said, "but the goal still is to make the core product offering and experience consistent property-to-property across the system."
Country Inns in 2005 plans to open a New Orleans property that combines four historic buildings into one structure. "Any adaptive reuse is going to differ from the standard prototype, but in ways that can be quite appealing," Johnson said.
Whether suburban or downtown, the typical new Country Inn is bigger. "The average size we signed in 2004 was 80 rooms, whereas five years ago it might have been 70 rooms," Johnson said. "Our goal has been to keep the brand ambience homey and residential, but as the prototype has matured, it's not as 'country' Country as it had been. Rather, it's become more of a sophisticated Country feel."
Mindful that business travelers' expectations continue to rise, both Hampton and Country Inns have undertaken a range of service upgrades. Hampton in 2004 launched a multi-phase effort, dubbed "Make It Hampton." It includes improvements to the breakfast buffet and the addition of a grab-and-go breakfast alternative. The entire chain now is equipped with high-speed Internet access in all guest rooms, offered free to guests. As of last month, all Country Inns also offer complimentary high-speed access. "Where there's a wired solution in place, it's in all guest rooms," Johnson said. "Where a wireless solution has been installed, it's available in the public spaces as well."