Hawthorne To Develop Extended-Stay Properties In U.K.
<B> Hawthorne To Develop Extended-Stay Properties In U.K.</B>
By Lynn Woods
Hawthorne Suites, one of the brands operated by U.S. Franchise Systems, has formed an agreement with GBI Hotels LLC, based in Calabassas, Calif., to develop properties in the United Kingdom. The deal represents one of the first forays of a U.S. extended-stay brand overseas.
The first property is scheduled to open in 2000 in London, followed by nine others variously located in the greater London area, Glasgow and Manchester. Each will include from 80 to 120 studio, one- and two-bedroom suites, with fully equipped kitchens and business services, along with daily hot breakfast buffet, evening social hour, complimentary newspaper, outdoor pool, exercise room, onsite laundry, valet service and convenience store.
Mirroring a development pattern that reflects a higher concentration of the population in urban areas and more reliance on public transportation, the hotels mainly will be located in center cities, said Dr. Frank Sanderson, president of GBI Hotels. He noted that the goal was to develop a total of 25 properties in the United Kingdom and Ireland. Because land in Europe is at a premium, many of the Hawthorne properties probably will be conversions.
The extended-stay product as it is known in the United States does not exist in Europe. "The closest thing is service apartments, which are leased out by the year," noted Sanderson. Clearly, Hawthorne views that lack as a hidden opportunity.
But other hotel executives are wary of crossing the pond. Paul Kirwin, president of Country Inns & Suites, which has six hotels in Europe and three under construction in Asia, said the demand for suites--which comprise just a portion of the rooms in each property--in Europe is mainly from transients.
Besides the fact that there already is what Kirwin considered "an extensive amount of product in the form of apartment hotels," exporting the U.S.-based new-construction concept to Europe brings another set of problems. Building codes in Europe are much stricter, for one. Second, room layouts are different. Because many developers overseas don't invest in sprinkler systems, the rooms--or series of rooms--tend to be built on a horizontal axis parallel to the street, making for an easier exit in case of fire. For a similar reason, buildings tend to have more internal staircases, upping the cost of development.
While most extended-stay executives contacted said they are not looking to build overseas--next on the list, after critical mass is achieved in the United States is typically Canada and Mexico--a few, including Residence Inn's Tim Sheldon, said opportunities exist for the right product. "It might be apartments"--a commodity Marriott recently invested in, with the acquisition of Executive Apartments--"or we might merge Residence Inn and TownePlace Suites." He added that the pattern of extended-stay travel also might be different, perhaps leaning more toward durations of six months rather than a month.