Conversion is most popular Choice
Property Week, 19th March 2010Most operators will expand through the conversion of existing hotels and property, rather than construction new-build hotels, because of the lack of development financing.
Stephen Joyce, president and CEO of Choice Hotels international, explained:” Expansion for us will be through conversion. We had no pipeline in the UK, so now we are looking at franchisee partners.”
Choice also plans to look at bringing back its new-build Sleep Inn concept to the UK in the long term. However, Joyce concedes that a present new build is not on the agenda because of a lack of finance and availability of development sites.
Choice had 40 hotels in the UK and is looking for opportunities in York, Manchester, Leeds, Glasgow and Bristol for its Comfort Inn and Quality brands.
Starwood Hotels & Resorts is on the expansion trail in the UK and further afield – opening brands such as Aloft (in Brussels) and Le Meridien (in Paris) – but its growth will mainly be through conversions. It has two new-build hotels that will open this year, including one at Ballymore’s Eurovea development in Bratislava, Slovakia.
Starwood president of global development Simon Turner said:” We see an upswing in business globally but there is less new development and we will be looking at conversions for many openings.”
Clive Hillier, CEO of Vision Hospitality Asset Management, said:” The development pipeline has a huge knot in it.” But Turner added:” Development is a lengthy process. You can’t just turn it on or off quickly. It is about having a longer-term view.”