September 2019 | www.hotelsmag.com

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16 COVER STORY Disrupting the disruptors Thai property developer Apichart Chutrakul’s investment in lifestyle hotel developer and operator SEPTEMBER 2019 VOLUME 20, NUMBER 3 Standard International is part of his bigger strategy to acquire a set of like-minded brands that can learn EDITORIAL/PUBLISHING GLOBAL ADVISORY BOARD from each other and even collaborate on projects to Jeff Weinstein Jonathon Zink compete with entrepreneurs disrupting the hotel space. EDITOR IN CHIEF MANAGING DIRECTOR [email protected] Burba Hotel Network, Costa Mesa, California Barbara Bohn 25 FEATURE MANAGING EDITOR Arthur de Haast [email protected] GLOBAL CEO HOTELS 325 Jones Lang LaSalle Hotels, David Wood PUBLISHER Robert Hecker Read the list of ever-evolving industry giants. [email protected] MANAGING DIRECTOR Horwath Asia Pacific, Singapore What are the biggest hotel companies in the world, Bert Ganzon SENIOR ART DIRECTOR Ramsey Mankarious and how is the complexion of the 325 changing? CEO Steve Vanden Heuvel Cedar Capital Partners, London SENIOR ART DIRECTOR Robert Stiles 4 NEWS UPDATE Brittney Hackbart PRINCIPAL & MANAGING DIRECTOR ASSOCIATE ART DIRECTOR RobertDouglas New faces of homesharing Carolina Martinez Larkspur, California FREELANCE DESIGN Trevor Ward Making co-work pay Amy Carter MANAGING DIRECTOR W Hospitality Group, Lagos, Nigeria PRODUCTION MANAGER Asia Pacific deal pace 38 Q&A Ovolo CEO Girish Jhunjhnuwala Copyright © 2019 Marketing & Technology Group Inc. All rights reserved. Reproduction in whole or part without written permission is prohibited. SUBSCRIPTIONS: Call 847-697-2111 to begin, change or cancel a subscription. 40 CONSTRUCTION Steel-framed modular evolves

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www.hotelsmag.com • HOTELS’ Investment Outlook • September 2019 1

NEWS UPDATE

Headline Deck

HOMEsweet HOMESHARING FOMO may be the biggest factor driving hotel companies to invest in the space – that, and a little firm called Airbnb.

he April launch of Homes & Villas business. Guests booking during the like Home Away and VRBO. Lodging by pilot test wanted longer stays, larger firms largely have stood by while the T provided the latest confirmation shared spaces, multiple bedrooms, shared economy model carved out its that homesharing has reached the kitchens and other amenities associated own space, rising from nothing to more mainstream. The lodging behemoth with leisure . than 8% of the U.S. hotel market in 10 opened up access to 2,000 premium Marriott had good reason for years, according to hotelappraisers.com. and luxury homes in more than 100 caution: Some rivals have struggled to Globally, according to iproperty.com, destinations in the U.S., , the make a go of it. Hotels took stakes Airbnb has more than 6 million listings Caribbean and Latin America. in two homeshare firms, Onefinestay in 191 countries, 150 million total users, Marriott didn’t blindly dive into the and Oasis; on an investor conference call and more than 2 million guests each business; last year it ran a pilot test in last spring, CEO Mark Hoplamazian night; By 2020, projected revenue could Europe. “Can we work in a model with pointed to struggles with consistent be as high as US$8.5 billion. management companies to execute quality, an expensive delivery model and Now, Airbnb is shedding its budget against standards successfully, do guests challenging local regulations. Ulti- heritage with the addition of a new tier, think they had a Marriott experience, mately, he said, it was “hard to get to a Airbnb Luxe, which consists of 2,000 and how does this sit against our core point where you are receiving, from a fi- upscale homes, villas, castles, islands business?” were among the concerns, nancial return perspective, a sustainable and other rentals aimed at high-net- says Jennifer Hsieh, vice president of the model.” , which eventually bought worth travelers. Homes & Villas initiative. Onefinestay, has found profitability a New York-based Researcher and The pilot demonstrated the logistics challenge. lodging consultant Bjorn Hanson says of working with property managers anyone involved in the conventional ho- and how to ensure certain standards. A NICHE THAT CAN’T BE IGNORED tel business is now compelled to at least Guests liked the product, and the data The obvious factor driving hotel compa- test homesharing because of shifts in de- suggested that bookings weren’t steal- nies into homesharing is demand, fueled mand. “If the potential is that large, they ing roomnights from the core lodging by the rise of Airbnb and smaller players need to learn this new business,” he says.

4 September 2019 • HOTELS’ Investment Outlook • www.hotelsmag.com NEWS UPDATE A BeMate residence in the Calle de Blasco de Garay, For companies like Marriott and Choice The idea is to allay some of the anxiety Hotels that have a large loyalty member associated with staking the success of a base, he adds, offering longer-stay family vacation or a milestone anniver- vacation rental inventory is essential, sary trip on an unknown quantity. both for earning and redeeming points. “We recognize that level of anxiety, The other big motivator: attracting and we want to provide the home that younger customers. “We see the trend really delivers against a family vacation especially for younger travelers to stay — one that will look better than or just in alternative accommodations,” says like the pictures, someone you can call Michael Bellisario, vice president and 24/7, and service levels that you would equity research analyst for Robert W. expect from Marriott,” Hsieh says. Baird & Co., Chicago. “Those people Properties in the Homes & Villas will travel for the next 30 to 40 years, network are not exclusive to Marriott; and if Marriott can gain a little of that Marriott acts as a distribution platform. travel wallet early on, they will see Bonvoy members are expected to drive benefits down the road.” bookings: Survey data showed 27% of Bonvoy members had rented a home in APPROACHES VARY the previous 12 months. “One of our Marriott’s foray into homesharing advantages is members’ ability to lean relies on a network of trusted property into the program to earn and redeem management companies been vetted points,” Hsieh says. and instructed in Marriott’s standards. Choice, which debuted Vacation The homes are professionally cleaned Rentals by Choice Hotels in 2016, offers and equipped with high-speed Wi-Fi, about 30,000 rentals in 50 of the top premium linens and amenities and fam- U.S. vacation destinations; all are run ily-friendly conveniences as requested. by local property management firms. The company, which expects to double its portfolio this year, was motivated by Exterior of a home in Sonoma, data that showed that “many guests were California, part of Marriott International’s Homes & Villas looking for longer stays and ways to use their Choice Rewards points,” says Sara Searls, vice president of digital com- merce. Travelers book the properties on a separate site. Accor took a different approach, buying the upscale Onefinestay home- share brand in 2016 for US$166 million and integrating it with its lodging brands and loyalty program. After the purchase, the company sustained a US$288 million writeoff partly attributed to the brand in the second quarter of 2018. But Accor remains committed to the potential of homestay. The portfolio, which has doubled to 5,000 since the acquisition, is divided between an urban collection, with properties in major U.S. and European cities exclusive to the brand, and a villa collection specializing in “We were the first hotel chain that, instead of fighting locations and managed by local Airbnb, embraced it and said we can do it better. Now professionals. Accor’s strategy for Onefinestay is everybody is doing it.” to scale “strategically and sustainably - Kike Sarasola, president, Room Mates Hotels so that we maintain brand integrity and consistency along the way,” says its CEO,

www.hotelsmag.com • HOTELS’ Investment Outlook • September 2019 5 NEWS UPDATE

Thomas Girard. Short-term, it will focus on signing more exclusive management agreements in markets where it already has a presence, such as New York, , Paris and London. “Our core business has always appealed to single The dining room of a families and leisure travelers looking home on Park Avenue, for private rentals, but today we’re also , part of seeing a growing trend in the number Accor’s Onefinestay of multigenerational vacations,” Girard says. Business travelers with families in tow, a growing segment, are driving expansion into more urban sites. Room Mate Group, Madrid, created a division in 2014 to manage rental homes and buildings under the Be Mate flag. The homes can be booked on Room Mate’s reservation site. Its latest push is to get exclusive rights to manage whole buildings. Over the next year and a half This villa on the Croatian it expects to open 13 Be Mate sites in island of Korcula is part Mexico City, Milan, Venice, , of Marriott Internation- al’s Homes & Villas. the Canary Islands and other destina- tions. Room Mates Hotels President Kike Sarasola says other sites in North and South America are targeted for POTENTIAL PITFALLS expansion. Despite hotel owners’ fears, the hotel players involved in homeshare tend to dismiss “We were the first hotel chain that, skeptics’ concerns about cannibalization. The audience for vacation rentals, they instead of fighting Airbnb, embraced it argue, seeks a different product than the business traveler staying a night or two in a city or the young single looking for adventure on a budget. Marriott International is and said we can do it better,” Sarasola eyeing potential vacation destinations that wouldn’t necessarily support a full-blown says. “Now everybody is doing it.” He hotel development; 40% of its initial homeshare portfolio was in new markets. thinks hotel companies have an edge in Thomas Girard, CEO of Accor’s Onefinestay, says length of stay is probably the the homeshare space because of their biggest factor that separates demand for hotel rooms versus vacation rentals — expertise in catering to guests’ needs, hotels average less than two nights; vacation rentals tend to stretch out for seven or more nights. the infrastructure and contacts that an Homeshares also face different local legal hurdles than hotels. That will individual owner can’t match. complicate due diligence and slow expansion for a company like Marriott, says Hyatt, which backed away from its Michael Bellisario, vice president and equity research analyst for Robert W. Baird disappointing investments in Onefin- & Co. “Their growth profile will be more baby steps and methodical. They will want estay and Oasis, retains a foothold in to check all 10 boxes before they jump in.” Hotel companies will be weighing their ability to scale and the potential vacation rentals. It picked up 10 condo revenues that homeshare affiliations will yield. Airbnb has already set the bar low, properties as part of its acquisition of so potential fees from renting out a single home or apartment pale versus the Two Roads Hospitality last year, and management or franchising fees associated with hotels. “the vacation rental business model gives “For many companies, it’s hard to justify the economics of investing in the mar- us more control regarding both the prod- keting and infrastructure to support something that represents a very small share or revenue for the foreseeable future,” hospitality consultant Bjorn Hanson says. uct — quality, service and amenities — One way to mitigate the smaller profit, he says, is to focus on the upper reaches of and the booking experience, since most the market and destinations where higher daily rates will yield higher income. units are exclusively bookable through Homeshare owners need some love, too. “To be competitive and continue to our platform,” says James Francque, grow the platform, marketshare and units, companies need to make their prod- Hyatt’s global head of transactions. He ucts more attractive from the top to the bottom for all constituents, both travelers and owners,” Bellisario says. says the experience with Oasis and the Girard says the past year has been devoted to “ensuring we are customer- online marketplace “continues to inform centric in everything we do,” from guests to homeowners and travel agents, with our approach to how we might offer an emphasis on consistency and quality. residential options for the benefit of our “The private rental industry is particularly complex and always evolving,” he guests, owners and shareholders.” adds. “You need to be patient and persistent in order to succeed.” Contributed by Megan Rowe

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NEWS UPDATE

ASIA PACIFIC DEAL SNAPSHOT With a focus on , China and Australia, the second half of the year promises increased activity.

eal opportunities as vast as over the past few years, ranging from Asia Pacific itself abound US$8.3 billion to US$10 billion, Din the region. Investors are excluding Wanda’s US$2.5- approaching the second half of 2019 billion portfolio deal in 2017. with confidence that transaction As the industry moves into the activity will increase in volume. That year ahead, experts in the Asia Pacific sentiment is backed by data: JLL notes market and speakers at the Hotel “Investors in Japan need that from 2008 through 2018, Asia Investment Conference Asia Pacific to be backed by a good Pacific volumes have been stronger in (HICAP) point to the areas in the reputation and track the second half of the year for eight of region that they expect will see the the 11 years. most activity. This is every investor’s record to achieve the best Asia Pacific typically contributes abridged list of the markets to keep pricing. That could pose approximately 11% to 16% of total their eyes on to get deals done. global transaction volumes, accord- a challenge for some...” ing to JLL. Transaction volumes for JAPAN: STRONG AND GROWING – Suchad Chiaranussati the region have been relatively stable Japan is consistently one of the most

www.hotelsmag.com • HOTELS’ Investment Outlook • September 2019 9 NEWS UPDATE

active hotel investment markets in the However, investors need to keep in region, experts say. Over the last five mind one thing, Ling says: “Hotel valu- years, JLL notes that the country has ations and investments will increasingly seen more than US$14 billion in hotel be underwritten by income, an import- real estate investments. “Transaction ant factor for international investors.” activity has been predominantly driven by domestic investors, in par- AUSTRALIA: GOLDEN AS ITS COAST ticular local REITs and private equity, Australia and New Zealand might while regional and global players have look like siblings to the rest of the also entered the market and remain world, but for Jason Chong, CEO, active and try to stay competitive Cornerstone Partners Group, there’s against strong domestic interest,” says a clear favorite child when it comes to Mike Batchelor, CEO, Asia, JLL. deal flows. “While New Zealand has The appeal is multifaceted. Inves- “While New Zealand all but done away with bureaucracy, it tors benefit from access to low bor- has all but done away just doesn’t have the demand genera- rowing costs in the 1% to 1.5% range, tors inherent to Australia,” he says. Batchelor says. Meanwhile, demand in with bureaucracy, it just Australia welcomes over twice the the country is expected to grow with doesn’t have the demand number of international tourists as an incoming wave of large-scale global New Zealand (9.2 million versus 3.8 events, such as the 2019 Rugby World generators inherent million, respectively, in 2018). Couple Cup, 2020 Olympics and the to Australia.” – Jason Chong that with a population more than five 2025 World Expo. times that of New Zealand, and Chong Suchad Chiaranussati, managing says there’s little thought left on the director and chairman, SC Capital exploring opportunities in other mar- power of domestic tourists in Australia. Partners, says that while Japan does kets that are also benefiting from Japan’s Not surprisingly, investors have offer some of the cheapest financing in growth in international visitations. their eyes on Sydney and Melbourne the region, investors need to be backed — but there are some challenges by a good reputation and track record to CHINA: COUNTRY TO WATCH in those cities. “Given the market achieve the best pricing. That could pose While hotel development and in- fundamentals and long-term, passive a challenge for some trying to get their vestment activities in China have ownership of assets in Sydney, deal shovels to the ground in the country. primarily been driven by domestic flow will remain relatively low; how- Even so, Kevin Colket, founder, enterprises in the past, David Ling, ever, opportunities are available for Global Hospitality Investment Group, head of strategic development, CDL experienced hotel investors who can believes that supply will continue to be Hospitality Trusts, says the country renovate and reposition tired assets added in the months up to and after is poised to witness more ventures by and achieve significant operational major events. While oversupply is a regional and international players. “In improvements,” Colket says. Mel- short-term concern, he remains bullish the years ahead, China is envisaged bourne, on the other hand, is expected on the market due to the government’s to become a more strategic market for to achieve record supply in the next focus on expanding as well international hotel investors. In a way, few years, causing issues in the market as the exponential rise in inbound this would not be dissimilar to the despite longer term demand drivers tourists, especially thanks to coveted unfolding of the remaining strong, he adds. demand from travelers from main- markets in Japan to international Nonetheless, Chong says Australia land China. Those factors, along with funds, particularly since the dawn of is a country to keep on the radar due continued strong demand drivers, will the new millennium,” he says. to its strong economic fundamentals help the market to absorb the current The supply surplus seen in recent with a healthy mix of leisure and pipeline and resume its rate growth. years transpiring from an era of corporate demand. International JLL expects Japan’s transaction rapid real estate developments will visitor numbers are forecast to grow at volumes in 2019 to reach about US$2.7 eventually be resolved by the growing 6.2% per annum over next three years, billion, or 9% year-on-year. As the demand from China’s continuing aided by the UnDiscover Australia global gateway into the country, economic growth and urbanization, campaign. While obtaining credit can Tokyo is the most sought-after invest- Ling adds. Thanks to growing domes- be an issue for some developers, tight- ment destination, where yields are tic demand, hotel occupancy across ened lending should lead to histori- typically between 3% and 3.5%. How- some of the country’s major cities is cally lower levels of new supply, which ever, as there are limited opportunities rising, paving the way for recovery in will benefit incumbent hotels. available in Tokyo, JLL sees investors ADR, RevPAR and operating profits. Contributed by BHN

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NEWS UPDATE

F B bump& big benefit of co-work

CitizenM New York Bowery Hotel

As communal he two biggest revenue oppor- spaces across several brands. The Hilton and co-work tunities for properties providing Norfolk The Main has activated and Tco-working space are a spike in energized shared spaces to create long- spaces expand to food and beverage revenues and a surge term co-working solutions, according more brands, F&B in the energy around the hotel. to David Marr, senior vice president amenities drive “Offering services and amenities and global head of full service brands. incremental revenue. for people to do work or get together “While the goal is to add value for cus- builds loyalty, plus it’s an opportunity tomers, this also will offer our hotels an to sell guest and meeting rooms, and to additional revenue source,” he says. show customers what you offer,” says Its new Motto by Hilton — a mi- Michael Doyle, managing director and cro-hotel brand with an “urban vibe,” executive vice president of CHMWar- opening in global locations beginning nick, a hotel asset management firm. next year — will feature the Motto The potential for greater profitabil- Commons, a communal space with ity from F&B purchases by co-work- varied seating types, lots of power ing space users alone is high, Doyle sources and natural light. Global Brand adds. “Well-crafted lobby grab-and-go Head Tripp McLaughlin sees revenue operations will produce a mid-30% to potential from F&B at the Commons. mid-40% profit margin, while hotel “Given the [planned] common spaces restaurants will produce margins and larger focus on F&B — with a ranging from the mid-single digits to coffeehouse, bar and restaurants — we the mid-10%.” anticipate the co-working and commu- Hilton is looking to take advantage nal space will drive a significant share of of that high return with co-working revenue at each property.”

www.hotelsmag.com • HOTELS’ Investment Outlook • September 2019 13 NEWS UPDATE

Another beneficiary of food revenue from co-working space users is Fitler Club, a private lifestyle club with office space for rent by member companies, as well as a 14-room hotel. Following the concept’s June debut in Philadelphia, about 20% of revenue is coming from F&B purchases, including from users of the 34,000-square-foot co-working space, Offsite. “That’s revenue that we never factored in,” says founder David Gutstadt, who attributes success to hav- ing a noted chef. He says one tenant has committed to buy lunch from the eatery every day for its team of 15 people. Selina, an affordable, now 52-unit Rendering of Motto by Hilton café at its boutique brand that started in Bogota, communal Commons Colombia, has 10% of revenue coming lobby space from co-working, wellness and retail space and 30% from F&B, including grab-and-go and restaurant spaces. out on communal tables or at the bar, At the Moxy Times Square, New At CitizenM hotels, the lobbies are and work on laptops or take meetings, York City, a barbershop and tattoo the co-working spaces, usually with hot and it has energized the buildings.” parlor go along with co-working spaces, and cold F&B, and they’ve given life says David Israel, senior vice president of to the brand, says Ernest Lee, head of MORE THAN CO-WORK HotelAve, the property’s asset manager. development and investments, North For some hotel companies, the benefits “We do business in our lobby four times America. “We’ve always had very of providing co-working space come greater than a typical hotel in the city spacious lobbies where people just hang from sources other than F&B. because we’ve created a revenue stream from 7 a.m. through late night, with a Advertisers Index focus on filling the typical revenue void of prior to 5 p.m.” The Americas Lodging Investment Summit Horwath HTL Accor, which has a new co-working www.ALISconference.com www.horwathhtl.com Page 37 Page 21 partnership with Wojo, appears to be

Berkadia InterContinental Hotels Group focused on being all things to all custom- www.Berkadia.com www.development.ihg.com Page 11 Page 33 ers. “By partnering with Wojo, we shout out loud that our hotels are open to Best Western International Inc. The Lodging Conference www.bestwesterndevelopers.com www.thelodgingconference.com everyone for work, and thus we encour- Page 7 Page 12 age our business travelers customers to Burba Hotel Network Playa Hotels & Resorts www.BURBA.com Page 35 network during their stay,” says Frederic Pages 2-3 Fontaine, senior vice president, global Connor & Gaskins Unlimited LLC www.radissonhotelgroup.com/development innovation lab. Accor “aims to become www.CGUnlimited.com Page 29 Page 15 a lifestyle companion, and sees this as an Real Hospitality Group Crescent Hotels & Resorts www.realhospitalitygroup.com unprecedented opportunity,” he www.CrescentHotels.com Page 23 www.LatitudesbyCrescent.com continues. “By integrating new busi- Page 19 Trump Hotels nesses, we continuously redefine hospi- www.trumphotels.com Dometic GmbH Inside Back Cover tality and keep our brands fresh for both www.dometic.com Page 1 Union Investment Real Estate guests and locals.” www.union-investment.de/realestate Page 8 Accor has opened 93 Wojos across www.newesa.com France since the June rollout, and it Page 24 Wyndham Hotel Group www.wyndhamdevelopment.com plans to land in all major French cities G6 Hospitality Inside Front Cover www.g6hospitality.com/franchising with 350 locations by year-end, and Back Cover 1,200 spots in total by 2022. It is also Hard Rock Hotels & Resorts www.hardrockhotels.com developing Mama Works spaces along Page 31 side its Mama Shelter hotels. Contributed by Rayna Katz

14 September 2019 • HOTELS’ Investment Outlook • www.hotelsmag.com We don’t just BUILD BUILDINGS, we BUILD RELATIONSHIPS that LAST

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MODELING By Jeff Weinstein, editor in chief DISRUPTION 16 September 2019 • HOTELS’ Investment Outlook • www.hotelsmag.com COVER STORY

Headline Deck SANSIRI’S INVESTMENT IN STANDARD INTERNATIONAL GIVES THE THAI DEVELOPER YET ANOTHER VEHICLE FOR COLLABORATIONS THAT COULD LEAD TO NEXT-GEN BUSINESS MODELS.

hai property developer Apichart 121% RevPAR relative to its comp set. Chutrakul’s answer to omnipres- Standard also has a very high per- Tent disruption is collaboration centage of direct bookings and repeat among his disparate yet like-minded guests, further indicators of the brand’s holdings. “We collaborate to do some strength relative to its competitors. of the disruption work for each other, Chutrakul hopes to improve upon and help each other cope with this those numbers via potential mash-ups new, changing environment,” says the with other recent Sansiri investments. CEO of publically listed Sansiri Public Since November 2017, Sansiri’s focus Co. Ltd. It does sound so elementary on lifestyle has included investing in — internally sharing connections, trendy magazine and influencer resources and intellect to create new Monocle, Singapore-based co-work- concepts — and maybe it is. ing group JustCo and online art Take, for example, Sansiri’s gallery Artsy. It has also invested in November 2018 US$58 million invest- Hostmaker, a London-based manage- ment for a 35% stake in New York- ment company for Airbnb hosts, and based lifestyle hotel player Standard Farmshelf, a company providing in- International. Chutrakul simply door shelves to home-grow vegetables. views it as combining the strengths of In Singapore, Sansiri has created Siri like-minded real estate and hospitality House, which combines a restaurant, companies to find growth opportuni- art gallery, property showroom and ties in a new vertical. It remains to be lifestyle concept store. seen how this East-meets-West part- It comes back to the potential of nership fares with its stated five-year collaboration. “We believe in helping plan to double Standard’s portfolio to each other,” Chutrakul says. “That’s 20 hotels globally in thriving urban basically what this is coming to. We and intriguing resort locations. Ten are trying to help everybody know properties are slated to open across everybody, and to share resources. It’s the world, including two in Thailand, much easier.” over the next few years. Standard International CEO Amar The plan includes and targets new Lalvani says those sister companies hotels in markets ranging from Paris, like Monocle and Hostmaker are Milan and to Las Vegas, New now part of his family. “We’re having Orleans, Dubai, Singapore and Hong pretty active discussions on how those Kong. Chutrakul adds that a contract come to life and how we can help each was forthcoming in Melbourne. Most other,” he says, adding while there isn’t recently, Standard opened its first in- anything quite tangible yet, Standard ternational hotel in London, a deal that has done some work with Monocle Apichart Chutrakul, was made before Sansiri’s investment. and is talking to Hostmaker. “We chief executive With its existing portfolio of six think we’re in a pretty good position officer, Sansiri Public properties and a combined 1,200 relative to the other companies to Co. Ltd., Bangkok rooms, Standard generates annual explore those areas,” he says. property-level revenue of approx- The Standard website offers deeply imately US$200 million, with an rooted editorial and content. “But average occupancy rate of 85%, and that’s not our business,” Lalvani says.

www.hotelsmag.com • HOTELS’ Investment Outlook • September 2019 17 COVER STORY

The Standard, downtown LA

“To have those conversations with someone like Monocle, it’s very pow- erful. So I think you’ll end up seeing further evolution of what Standard culture looks like.” For Sansiri, of course, as a public company the bottom line is paramount. And while Chutrakul certainly likes the ROI potential of Standard, he says with strong conviction that his recent spate of related investments is truly being done to secure Sansiri’s future. “We can’t just sit still and be compla- cent. The world is changing, and if you sit still one day you will realize that you are out of date. You’ll be engulfed by all of these new players. We want to be the new player all the time.”

LEARNING THE BUSINESS Aggressive, yes. But don’t look for The Standard London opened in July. Sansiri to become a hospitality vulture. Chutrakul is well aware of the work required to manage Stan- of hip hotels as well as its innovative that led to Sansiri’s investment. dard’s growth, while at the same time One Night spontaneous hotel booking Lalvani came to Thailand in 1998 with minding his existing billion-dollar app, which will soon add Bangkok. Capital Group to source real estate business. “We are trying Bunkhouse has three hotels in the deals and through business interac- to build from five hotel to 25 within offing in New Orleans, Atlanta and tions, the two struck up a friendship. two, three years. That’s a pretty heavy Austin, Texas, with other deals in vari- “Today, we have some of the same burden on us already.” ous stages of development. One Night, values that we can tap to move [Stan- That said, no plans are in the works operating in some 17 cities, has been dard] across from the United States to right now to create or add other hotel spun off, although Standard Interna- the world. And we can bring some of brands. But the deal does bring extra tional remains the majority partner. the values of the East and the world to vitality to Standard’s recently acquired In fact, it was an existing relation- United States,” Chutrakul says. “We Austin, Texas-based Bunkhouse Group ship between Chutrakul and Lalvani also see the niche in the Asian market

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that people are now getting a little bit tired of the standard hotel room. They’re looking for a little bit more, an experience, and are willing to pay a little bit more.” Attempting to get out of the commodity box in most Asian markets is critical, according to Eric Levy, managing director of Tourism Solu- tions International, a Singapore-based consultancy. “Many developers realize this and Standard appears to be more realistic than others. They will not get London or New York City pricing “The return is quite good. There is, of course, in Ho Chi Minh City or Manila and an opportunity to help each other – for us to sell more seem to have comfort in that.” condominiums and for them to leverage off Levy adds that Sansiri’s investment could also allow Standard to increase our know-how of how to expand.” service levels in lower cost markets, – Apichart Chutrakul on why Sansiri invested in Standard International which will enable it to better do what they already do well. “Perhaps even better in some markets than the Jensiriratanakorn says several they will have to invest to deliver the original few markets,” Levy says. international hotel chains have de- brand promise,” Levy adds. “This will Horwath HTL’s man in Bangkok, centralized and rely on local experts, not be a profit center for a few years Nikhom Jensiriratanakorn, notes that adding that Standard/Sansiri has the and they will have to accept that and Standard will likely face challenges scale to do the same. “For smaller make the investment, or they run the created by major Asian hotel markets and growing chains, it’s a challenge risk of not delivering, and consumers that are geographically separate and that they have to deal with, to be able will notice this.” with their own languages, cultures, to compete locally while managing While trying to encourage the etc. “The concept and value propo- their operational efficiency and not sharing of ideas among Sansiri sitions that work in one country may over-hiring,” he adds. lifestyle brands, Chutrakul isn’t not be well received in another,” he More than anything, though, Levy getting too involved in the day-to-day says. “Hotel groups cannot only rely says this new venture must remain operations of Standard International on international crowds, but how do disciplined and decline projects that hotels. Lalvani “is a very capable they understand locals’ preferences?” are not accretive to the brand. “Also, hotelier,” Chutrakul says. “What we are trying to do is to give them a good jump ahead into other properties and Sansiri has more than a 6% interest in JustCo, Southeast Asia's largest owners around Asia. Of course, in Eu- provider of co-working spaces. rope, we already have an established network because we have already built some condominiums. So we are help- ing them with the property company. We also help them with technology innovation and construction.”

SANSIRI CRED Certainly, Sansiri is bringing capital to the table to jumpstart Standard’s expansion, but what Lalvani says has been really important is how Sansiri’s infrastructure has helped Standard quicky set up an Asian base of oper- ation in Bangkok. “We rely on them for things that they’re very good at, which is construction project manage-

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HHTL_2019_HIO_SEPT.indd 1 19/08/2019 13:16 COVER STORY

Sansiri developed Khun by Yoo, a Philippe Starck- designed condominum.

THAILAND PERSPECTIVE

Standard International and Sansiri ment and relationships in the region,” also able to lean on Sansiri once again. talk about adding as many as four hotels in Thailand in the medium Lalvani says. “With Sansiri we’ve been “Their residential expertise is import- term, including in Bangkok, Phuket, able to be basically local and on the ant, which means how to design, how Hua Hin and Pattaya. But Horwath ground with this real credibility and to plan, how to market, how to sell HTL’s Nikhom Jensiriratanakorn relationship… They have something residential, including the database of says any investors interested in like 2,000 employees and made it a people they have built over the last growing a hotel footprint in Thailand should keep in mind that major priority to support us.” couple of decades,” Lalvani says. international airports in Bangkok, Levy adds that Sansiri has helped As a first-time investor in the hotel Phuket and Chiang Mai are running Standard create a good, evolving local space (other than one owned resort in above capacity. team of professional hoteliers. “So it is Phuket), what challenges Chutrakul “So they need to prepare their not residential guys attempting to run most is how to best use his time and team to cope with the competition until airport expansion plans are hotels. Sansiri/Standard has been wise resources. “The time that you have executed,” he says. “The long- in this regard. They have made the to travel, the time that you have to do term outlook of Thailand tourism is investment in a growing hotel team,” this and that. Of course, the man- positive but the journey to get there Levy says. power requirements are quite taxing may not be as smooth as people The initial Standard projects on Sansiri itself.” would imagine.” Jensiriratanakorn points to under development in Thailand To that end, Chutrakul says Sansiri a few negative factors that will they can be more easily serviced is investing in people who source impact Thailand in the near to because of the Sansiri infrastructure. potential deals, do their due diligence medium term: “They’ve been generous to allow us and pitch the offers. “I don’t think if • Airport infrastructure needs imme- to use it,” Lalvani adds. “That's been you run from America to do the pitch- diate attention to increase capacity and improve overall experience. very important.” ing in Indonesia, it’s going to work. It’s • Impact from the contraction of Sansiri also has the ability to create quite too far away, right? But for us, Chinese demand following the scale, developing as many as 100 or Indonesia is quite close.” Phuket boat accident, and the U.S. more of its own projects at a time. The other thing Chutrakul is China trade war: Inbound tourism “We’re a much smaller company, but learning about the hotel business: “It’s demand has also been hit by the strengthening of the Thai currency. their project management and the way a hard business. It’s a service business, • Political uncertainty after the they deliver quality at scale has also which is a little bit different from buy- recent national election: Interna- been very important,” Lalvani says. ing and selling. But, of course, we have tional travelers take a cautious “So there’s cross-learning.” a property management company in view of the situation. With Standard planning its first the service business – so we know a lit- • Competition from other regional tle bit. But hotels are daily and hourly destinations such as Vietnam, residential component in Phuket, which is ramping up quickly. Thailand, as well as others in that business, so it’s taxing, a little bit. But country and another in , it is it’s OK. It’s been a good experience.”

22 September 2019 • HOTELS’ Investment Outlook • www.hotelsmag.com CELEBRATING THE ART OF HOSPITALITY REALHOSPITALITYGROUP.COM

FEATURE

HOTELS

Disruptors like Oyo break into the ranking in a big way, while Chinese giants such as Jin Jiang assert their dominance via acquisition.

By Jeff Weinstein

he makeup of the world’s 325 better outfit and standardize budget biggest hotel companies is accommodations gained serious Tincreasingly unfamiliar to the traction in . Now, via increased global hotel community. capital sourcing and dealmaking, it is It wasn’t more than five years ago growing rapidly in China and has its when then- Jin Jiang stood eye on the United States. It is a bit of with 235,000-plus rooms and some a hybrid with a mix of hotels, rooms 1,500 hotels. Based on 2018 data, now- and vacation rentals, which makes for Jin Jiang International has become the uneven comparisons, but it is not to world’s second-biggest hotel company, be overlooked. after its acquisition of Radisson Hotel Marriott International remained Group’s more than 180,000 rooms and king of the hill with more than 1 mil- 1,100-plus hotels. With 941,794 rooms lion rooms. Big movers in the ranking and more than 8,700 hotels, it has include Bangkok-based Minor Inter- surpassed Hilton. national, which grew via acquisition, Then there is Oyo Hotels & in this case of NH Hotels. On the Homes, a name virtually no one pages ahead, follow the list based on knew until 2018, when its concept to data as of December 31, 2018.

www.hotelsmag.com • HOTELS’ Investment Outlook • September 2019 25 FEATURE

2018 2017 2018 2018 2017 2017 rank rank Company Location Rooms Hotels Rooms Hotels 1 1 Marriott International Bethesda, Maryland USA 1,317,368 6,906 1,195,141 6,333 2 5 Jin Jiang International Holdings Co. Ltd. Shanghai, China 941,794 8,715 680,111 6,794 3 2 Hilton McLean, Virginia USA 912,960 5,685 856,113 5,284 4 3 IHG (InterContinental Hotels Group) Denham, 836,541 5,603 798,075 5,348 5 4 Wyndham Hotel Group Parsippany, New Jersey USA 809,900 9,200 753,161 8,643 6 6 AccorHotels Paris, France 703,806 4,780 616,181 4,283 7 7 Choice Hotels International Rockville, Maryland USA 569,108 7,021 521,335 6,815 8 - Oyo Hotels & Homes Gurugram, India 515,144 17,344 - - 9 9 Huazhu Group Ltd. (formerly China Lodging Group) Shanghai, China 422,747 4,230 379,675 3,746 10 8 BTG Hotels Group Co. Beijing, China 397,561 4,049 384,743 3,712 11 10 Best Western Hotels & Resorts Phoenix, Arizona USA 295,849 3,618 260,015 3,324 12 12 GreenTree Hospitality Group Shanghai, China 221,529 2,757 190,807 2,289 13 11 Hyatt Hotels Corp. Chicago, Illinois USA 208,297 852 204,485 779 14 15 Dossen International Group , China 199,042 2,247 105,951 1,087 15 14 G6 Hospitality Carrollton, Texas USA 123,162 1,422 124,739 1,417 16 19 Qingdao Sunmei Group Co. Qingdao, China 121,483 2,352 91,706 1,697 17 21 Aimbridge Hospitality Plano, Texas USA 102,786 834 87,971 706 18 17 Magnuson Worldwide Spokane, Washington USA 94,386 1,119 103,306 1,274 19 26 RLH Corp. Spokane, Washington USA 85,700 1,327 64,308 984 20 18 Meliá Hotels International Palma de Mallorca, 83,253 329 96,956 382 21 16 Westmont Hospitality Group Houston, Texas USA 82,617 731 105,000 507 22 22 Interstate Hotels & Resorts Arlington, Virginia USA 80,172 481 67,958 390 23 68 Minor International Bangkok, Thailand 75,219 513 20,209 158 24 24 Whitbread Dunstable, England 74,624 793 71,282 770 25 23 New Century Hotels & Resorts , China 72,642 330 71,665 292 26 25 Extended Stay Hotels Charlotte, North Carolina USA 69,002 627 66,100 599 27 30 APA Group Tokyo, Japan 65,538 434 53,168 355 28 28 Co. Tokyo, Japan 60,508 288 57,010 274 29 33 Red Roof New Albany, Ohio USA 58,319 627 48,508 528 30 48 The Ascott Ltd. Singapore 56,594 433 31,285 306 31 29 Barcelo Hotel Group Palma de Mallorca, Spain 55,670 251 53,668 244 32 31 , 51,693 268 49,983 262 33 32 MGM Resorts International Las Vegas, Nevada USA 48,968 28 49,000 27 34 42 Zhuyou Hotel Group Hangzhou, China 47,190 788 38,580 583 35 34 Club Med Paris, France 47,141 69 46,708 69 36 38 Hotels Thame, England 43,421 578 40,000 562 37 37 Shangri-La Group , China 42,383 101 42,600 103 38 35 Riu Hotels & Resorts Palma de Mallorca, Spain 42,155 93 44,226 98 39 41 Millennium & Copthorne Hotels London, England 40,323 139 39,402 136 40 40 Caesars Entertainment Corp. Las Vegas, Nevada USA 39,960 32 39,680 32 41 36 Walt Disney Co. Burbank, California USA 39,652 38 43,121 52 42 - Wanda Hotels & Resorts Beijing, China 38,035 154 - - 43 50 HK CTS Hotels Co. Beijing, China 37,672 150 30,225 138 44 - Thomas Cook Group London, England 37,584 186 - - 45 39 Highgate New York, New York USA 37,307 123 39,940 132 46 44 Iberostar Hotels & Resorts Palma de Mallorca, Spain 37,100 124 37,100 110 47 43 Jinling Hotels & Resorts Corp. Nanjing, China 36,297 135 37,314 136 48 - Barony Hotels & Resorts Worldwide London, England 33,730 157 - - 49 45 Nordic Choice Hotels Oslo, 33,406 188 32,722 190 50 46 Fattal International Hotels & Resorts Tel Aviv, Israel 33,000 173 31,935 170

26 September 2019 • HOTELS’ Investment Outlook • www.hotelsmag.com HOTELS

2018 2017 2018 2018 2017 2017 rank rank Company Location Rooms Hotels Rooms Hotels 51 52 Narada Hotel Group Hangzhou, China 32,331 142 28,423 109 52 47 Pandox Stockholm, Sweden 32,268 144 31,613 143 53 51 WoodSpring Hotels Wichita, Kansas USA 28,500 240 28,500 240 54 55 Crescent Hotels & Resorts Fairfax, Virginia USA 28,137 103 24,255 94 55 53 Grupo Posadas Mexico City, Mexico 27,491 175 25,608 162 56 54 Grupo de Turismo Gaviota Havana, Cuba 26,752 62 24,885 57 57 58 Pyramid Hotel Group Boston, Massachusetts USA 26,125 120 23,112 92 58 104 Swiss-Belhotel International Hong Kong, China 25,753 139 13,226 80 59 83 Argyle Metro Hotel Group Sydney, Australia 24,730 131 17,847 92 60 56 InTown Suites Atlanta, Georgia USA 24,566 191 24,154 189 61 65 Country Garden Phoenix International Hotels Management Co. City, China 24,329 73 20,585 64 62 57 Frasers Hospitality Singapore 23,600 148 23,600 148 63 59 Hotel Okura Co. Tokyo, Japan 22,650 73 22,650 73 64 60 Mantra Group Surfers Paradise, Australia 22,100 137 22,101 137 65 62 Co. St. Louis, USA 21,626 138 21,233 136 66 63 Frankfurt am Main, 21,623 105 21,210 103 67 - Atrium Hospitality Alpharetta, Georgia USA 21,595 82 - - 68 81 Las Vegas Sands Corp. Las Vegas, Nevada USA 21,160 10 17,881 8 69 64 Omni Hotels & Resorts Dallas, Texas USA 21,000 60 21,000 60 70 74 Island Hospitality Management West Palm Beach, Florida USA 20,878 177 19,251 166 71 70 Hotels Geneva, Switzerland 20,775 78 20,185 76 72 103 Shijiazhuang Guoda Hotel Management Co. Shijiazhuang, China 20,660 298 13,324 212 73 77 Eurostars Hotel Co. (Grupo Hotusa) Madrid, Spain 20,606 197 18,929 179 74 66 Orbis Co. Warsaw, 20,600 133 20,500 126 75 69 Four Seasons Hotels and Resorts Toronto, Canada 20,204 95 20,204 95 76 86 Munich, Germany 20,160 71 17,387 62 77 61 HEI Hotels & Resorts Norwalk, Connecticut USA 19,781 61 21,621 73 78 49 B&B Hotels Brest, France 19,529 479 31,000 441 79 79 White Lodging Services Corp. Merrillville, Indiana 19,259 94 18,482 170 80 75 Prince Hotels and Resorts Tokyo, Japan 19,165 52 19,165 52 81 72 AMResorts Newtown Square, Pennsylvania 19,021 52 19,677 52 82 78 Archipelago International Jakarta, Indonesia 18,740 137 18,622 135 83 76 HHM Philadelphia, Pennsylvania 18,000 120 19,000 125 84 90 GCH Hotel Group Berlin, Germany 17,601 124 15,522 123 85 92 Rotana Hotel Management Corp. Abu Dhabi, United Arab Emirates 17,525 65 15,375 54 86 137 Huatian Hotel Group Changsha, China 17,517 71 9,621 35 87 107 The Indian Hotels Co. Ltd. , India 17,452 145 12,977 100 88 84 Remington Dallas, Texas USA 17,294 88 17,668 91 89 87 Crestline Hotels & Resorts Fairfax, Virginia USA 17,234 118 16,827 116 90 88 Tsogo Sun Holdings Bryanston, South Africa 16,271 110 16,008 98 91 117 Anhui Gujing Hotels Development Co. Anhui Hefei, China 16,120 201 12,039 161 92 114 Sotetsu Hotel Management (Sunroute Co.) Yokohama, Japan 15,571 83 12,213 71 93 89 H10 Hotels Barcelona, Spain 15,477 60 15,873 58 94 101 Concord Hospitality Enterprises Co. Raleigh, North Carolina USA 15,423 105 13,590 96 95 93 Hard Rock International Orlando, Florida USA 15,323 27 15,323 27 96 96 Blue Diamond Hotels & Resorts St. Michael, Barbados 15,166 45 14,552 37 97 - Far East Hospitality Singapore 15,000 95 - - 98 80 TPG Hotels & Resorts Cranston, Rhode Island 14,387 56 17,889 63 99 98 Interchange & Consort Hotels t/a Best Western Great Britain York, England 14,383 257 13,685 251 100 106 Grupo Piñero Palma de Mallorca, Spain 14,000 26 13,000 25

www.hotelsmag.com • HOTELS’ Investment Outlook • September 2019 27 FEATURE HOTELS

2018 2017 2018 2018 2017 2017 rank rank Company Location Rooms Hotels Rooms Hotels 101 100 Grupo Cubanacán Havana City, Cuba 13,885 67 13,633 66 102 116 Columbia Sussex Corp. Crestview Hills, Kentucky USA 13,755 39 12,122 40 103 95 Maritim Hotels Bad Salzuflen, Germany 13,492 44 14,825 47 104 102 Realstar Hospitality Toronto, Canada 13,478 141 13,478 141 105 99 Rosewood Hotel Group Hong Kong, China 13,196 63 13,675 63 106 111 Fujita Kanko Tokyo, Japan 13,190 61 12,227 53 107 113 Palladium Hotel Group Ibiza, Spain 12,814 43 12,225 42 108 - Greenland Hotel and Tourism Group Shanghai, China 12,749 47 11,007 40 109 123 Pan Pacific Hotels Group Singapore 12,625 36 11,335 32 110 167 Vinpearl Hotels & Resorts Hanoi, Vietnam 12,621 30 7,856 21 111 110 Event Holding GmbH & Co. Koeln, Germany 12,603 57 12,415 56 112 185 Eldorado Resorts Reno, Nevada USA 12,594 20 7,000 10 113 115 Hoteles Catalonia Barcelona, Spain 12,475 69 12,211 68 114 118 Sonesta International Hotels Corp. Newton, Massachusetts USA 12,343 79 11,848 76 115 154 Gloria Hotels & Resorts Beijing, China 12,314 64 8,825 43 116 112 & Resorts New York, New York USA 12,189 23 12,225 24 117 126 Savile Hotel Group Co.Ltd Guangzhou, China 12,173 64 10,809 58 118 121 Olav Thon Gruppen Oslo, Norway 12,076 79 11,610 78 119 122 Sage Hospitality Denver, Colorado USA 12,065 52 11,433 62 120 120 Pestana Hotels & Resorts Funchal, Portugal 11,933 97 11,756 93 121 119 Santika Indonesia Hotels & Resorts Jakarta, Indonesia 11,833 104 11,833 104 122 125 MCR New York, New York USA 11,672 86 11,000 96 123 109 Davidson Hotels & Resorts Atlanta, Georgia USA 11,625 38 12,722 42 124 144 Real Hospitality Group Ocean City, Maryland USA 11,455 105 9,215 84 125 94 GF Management Philadelphia, Pennsylvania USA 11,433 66 15,277 88 126 141 Deefly Hotels & Resort Group Hangzhou, China 11,262 72 9,470 59 127 140 Driftwood Hospitality Management North Palm Beach, Florida USA 11,184 56 9,584 48 128 128 Altrincham, England 11,098 61 10,260 54 129 168 Quest Serviced Apartments Melbourne, Australia 11,011 170 7,812 157 130 105 Hospitality International Tucker, Georgia 10,633 237 13,168 290 131 127 Lotte Hotels & Resorts Seoul, South Korea 10,510 30 10,480 29 132 97 Jaz Hotel Group Giza, Egypt 10,445 42 13,750 49 133 143 Hanshin Hotels Co. , Japan 10,424 46 9,225 46 134 - TFE Hotels Ultimo, Australia 10,378 77 - - 135 124 Langham Hospitality Group Hong Kong, China 10,282 28 11,106 30 136 131 Baywood Hotels Columbia, Maryland USA 10,188 104 10,059 102 137 129 Regal Hotels International Hong Kong, China 10,124 19 10,100 20 138 139 Dimension Development Co. Natchitoches. Louisiana USA 10,115 67 9,590 60 139 130 Century GoldenResources Group Beijing, China 10,088 20 10,088 20 140 - Champion Hotels Oklahoma City, Oklahoma USA 10000 150 - - 141 190 Valamar Hotels & Resorts Zagreb, Croatia 9,973 34 6,855 33 142 135 Sokos Hotels Helsinki, 9,925 51 9,815 50 143 147 Event Hospitality & Entertainment Sydney, Australia 9,894 61 9,132 58 144 133 Princess Hotels & Resorts Reus, Spain 9,877 22 9,877 22 145 134 Washington Hotel Co. Ltd. , Japan 9,831 42 9,831 42 146 283 ITC Hotels Gurgaon, India 9,792 106 4,277 73 147 - Daemyung Hotels and Resorts Co. Seoul, South Korea 9,725 17 - - 148 146 Boyd Gaming Corp. Las Vegas, Nevada USA 9,678 20 9,132 16 149 145 Dorsett Hospitality International Hong Kong, China 9,553 34 9,133 25 150 73 HNA Hospitality Group Beijing, China 9,500 39 19,443 30

28 September 2019 • HOTELS’ Investment Outlook • www.hotelsmag.com REDISCOVER

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2018 2017 2018 2018 2017 2017 rank rank Company Location Rooms Hotels Rooms Hotels 151 148 PM Hotel Group Chevy Chase, Maryland USA 9,455 49 9,125 41 152 142 Stonebridge Companies Denver, Colorado USA 9,422 58 9,294 55 153 149 Aqua-Aston Hotels Honolulu, Hawaii USA 9,355 42 9,065 41 154 153 Warwick International Hotels Paris, Franhce 9,222 56 8,895 51 155 138 McKibbon Hospitality Tampa, Florida 9,107 82 9,606 86 156 - Vienna House Vienna, Austria 9,048 50 - - 157 160 Kilit Hospitality Group Antalya, Turkey 8,885 18 8,386 16 158 165 , 8,882 42 7,922 36 159 132 OTO Development Spartanburg, South Carolina USA 8,875 65 9,921 73 160 152 PPHE Hotel Group Amsterdam, The Netherlands 8,800 38 8,927 39 161 173 Dalata Hotel Group Dublin , Ireland 8,746 42 7,674 38 162 156 Be Live Hotels , Spain 8,552 31 8,552 31 163 157 Antalya, Turkey 8,516 25 8,516 25 164 255 Penn National Gaming Wyomissing. Pennsylvania USA 8,300 26 4,749 13 165 176 Chesapeake Hospitality Greenbelt, Maryland USA 8,208 40 7,408 33 166 162 Hoteles Globales Madrid, Spain 8,122 36 8,122 36 167 261 Shamin Hotels Chester, Virginia USA 8,005 58 4,564 39 168 274 Janus Hotels & Resorts Boca Raton, Florida USA 8,000 30 4,417 26 169 184 Dorint GmbH Cologne, Germany 7,950 46 7,000 40 170 - Playa Hotels & Resorts Sunrise, Florida USA 7,915 21 6,130 13 171 163 Solare Hotels and Resorts Co. Tokyo, Japan 7,914 52 8,110 51 172 194 Hotel Equities Atlanta, Georgia USA 7,826 68 6,755 62 173 170 Sandman Hotel Group Vancouver, Canada 7,815 52 7,755 48 174 169 Danubius Hotel and Spa Public Limited Co. Budapest, Hungary 7,811 43 7,811 43 175 197 InterMountain Management Monroe, Louisiana USA 7,768 74 6,673 70 176 191 Grupo Hoteles Playa Almería, Spain 7,708 37 6,845 34 177 164 Mandarin Oriental Hotel Group New York, New York USA 7,638 30 8,103 31 178 181 City Lodge Hotels Cramerview, South Africa 7,600 59 7,072 57 179 188 Shenzhen Grand Skylight Hotel Management Co. Shenzhen, China 7,593 30 6,934 28 180 179 Centara Hotels & Resorts (Central Hospitality Intl.) Bangkok, Thailand 7,563 39 7,231 38 181 180 Sarovar Hotels & Resorts Mumbai, India 7,551 80 7,151 75 182 171 Marshall Hotels & Resorts Salisbury, Maryland USA 7,522 60 7,753 61 183 198 Vila Galé - Sociedade de Empreendimentos Turísticos Lisbon, Portugal 7,516 32 6,609 28 184 174 Furama Hotels International Singapore 7,500 41 7,500 41 185 212 Hospitality Ventures Management Group Atlanta, Georgia USA 7,480 44 6,209 33 186 175 Wynn Resorts Las Vegas, Nevada USA 7,464 4 7,464 4 187 241 American Casino & Entertainment Properties Las Vegas, Nevada USA 7,318 10 5,164 6 188 - Golden Entertainment Las Vegas, Nevada USA 7,273 8 - - 189 172 Yuehai (international) Hotel Group Co. Hong Kong, China 7,255 24 7,723 25 190 199 Kinseth Hospitality Companies North Liberty, Iowa USA 7,125 70 6,599 65 191 192 Lopesan Hotel Group Meloneras, Spain 7,125 20 6,875 21 192 178 Decameron Hotels & Resorts , Panama 7,066 36 7,335 37 193 161 Harbour Plaza Hotel Management Ltd. Hong Kong, China 7,011 11 8,333 12 194 216 Azimut Hotels Moscow, Russia 7,008 36 6,029 29 195 166 Benchmark The Woodlands, Texas USA 6,922 47 7,915 48 196 226 Group Dubai, United Arab Emirates 6,902 27 5,600 18 197 183 Grupo Real Turismo Mexico City, Mexico 6,885 41 7,009 40 198 215 Grupo Hotelero Santa Fe Colonia Santa Fe Cuajimalpa, Mexico 6,808 27 6,137 24 199 202 Outrigger Hospitality Group Honolulu, Hawaii USA 6,756 37 6,528 36 200 196 First Hospitality Group Rosemont, Illinois USA 6,742 45 6,708 41

30 September 2019 • HOTELS’ Investment Outlook • www.hotelsmag.com HARD ROCK HOTELS RANKED #1 IN GUEST REDEFINING WHAT A LIFESTYLE SATISFACTION AMONG UPPER UPSCALE HOTEL CHAINS IN DESTINATION EXPERIENCE CAN BE. NORTH AMERICA

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ATLANTIC CITY . BALI . BILOXI . DAVOS . DAYTONA BEACH . DESARU COAST . GOA . GUADALAJARA . HOLLYWOOD, FL . IBIZA . LAKE TAHOE . LAS VEGAS . LONDON . ORLANDO . PANAMA . PATTAYA . PENANG . RIVIERA MAYA . SAN DIEGO . SHENZHEN . SINGAPORE . SIOUX CITY . TAMPA . TENERIFE . TULSA . VALLARTA . VANCOUVER

AMSTERDAM . BARCELONA . BERLIN . BUDAPEST . CABO SAN LUCAS . CALDAS NOVAS . CHICAGO . DALIAN . DUBLIN . KANSAS CITY COMING SOON KAUAI . MALDIVES . MALTA . MADRID . . NEW ORLEANS . NEW YORK . PENSACOLA BEACH . SAO PAULO FEATURE HOTELS

2018 2017 2018 2018 2017 2017 rank rank Company Location Rooms Hotels Rooms Hotels 201 195 G.S.M. Hoteles Madrid, Spain 6,723 43 6,723 45 202 220 Robinson Club Hannover, Germany 6,701 23 5,877 24 203 207 Rosen Hotels & Resorts Orlando, Florida USA 6,694 8 6,338 7 204 177 Dusit International Bangkok, Thailand 6,688 27 7,337 28 205 219 Holiday Villa Hotels & Resorts Kuala Lumpur, Malaysia 6,674 27 5,892 27 206 200 Crystal Hotels Antalya, Turkey 6,561 13 6,561 13 207 221 Banyan Tree Hotels & Resorts Singapore 6,544 47 5,874 41 208 272 Fertitta Entertainment (Landry's Inc.) Houston, Texas USA 6,540 11 4,421 13 209 203 Kintetsu Hotel Systems Osaka, Japan 6,468 22 6,512 25 210 182 Rede Nacional Inn de Hotéis São Paulo, Brazil 6,462 60 7,035 54 211 209 Paradores de Turismo Madrid, Spain 6,415 97 6,331 96 212 206 Grupotel Hotels & Resorts Can Picafort, Spain 6,389 35 6,389 35 213 213 Pacifica Host Hotels San Diego, California USA 6,326 44 6,206 43 214 159 First Hotels Oslo, Norway USA 6,265 59 8,425 90 215 214 Hoteles Islazul Havana, Cuba 6,177 77 6,177 77 216 235 Oakwood Asia Pacific Ltd. Singapore 6,155 39 5,377 36 217 229 Wharf Hotels Hong Kong, China 5,973 18 5,519 16 218 189 Tishman Hotel Corp. New York, New York USA 5,932 10 6,911 9 219 222 N. Daskalantonakis Group Athens, Greece 5,865 29 5,755 28 220 218 Hipotels Cala Millor, Spain 5,847 28 5,927 29 221 236 Great Wolf Resorts Chicago, Illinois USA 5,845 16 5,322 15 222 228 Winegardner & Hammons Group Cincinnati, Ohio USA 5,835 25 5,526 23 223 108 Redefine BDL Hotel Group London, England 5,775 48 12,889 73 224 208 Spire Hospitality Deerfield, Illinois USA 5,745 25 6,338 22 225 204 YTL Hotels and Properties Singapore 5,733 30 6,453 12 226 201 Onyx Hospitality Group Bangkok, Thailand USA 5,728 43 6,546 44 227 284 Sandals Resorts International Miami, Florida USA 5,654 25 4,266 16 228 - New , India 5,576 56 - - 229 256 Chartwell Hospitality Franklin, Tennessee USA 5,538 38 4,695 35 230 224 Buffalo Lodging Associates Canton, Massachusetts USA 5,519 45 5,715 47 231 231 Vincci Hoteles Madrid, Spain 5,455 38 5,455 38 232 233 Mitsis Hotels Athens, Greece 5,415 17 5,415 17 233 232 Van der Valk Exclusief Hotels Nieuwerkerk aan den Ijssel, The Netherlands 5,383 37 5,422 36 234 211 Shimao Hotels and Resorts Hong Kong, China 5,336 15 6,289 22 235 237 Commonwealth Hotels Covington, Kentucky USA 5,278 43 5,278 43 236 151 Peachtree Hotel Group Atlanta, Georgia USA 5,275 45 8,991 34 237 251 Marcus Hotels & Resorts , Wisconsin USA 5,255 21 4,827 18 238 230 Chartres Lodging Group San Francisco, California USA 5,251 7 5,488 8 239 238 Shaner Hotels State College, Pennsylvania USA 5,229 51 5,229 51 240 277 Station Casinos Las Vegas, Nevada USA 5,169 12 4,388 11 241 - Citotel Groupement Hôtelier Paris, France 5,166 168 - - 242 - International Arlington, Texas USA 5,123 141 - - 243 243 GLH Hotels Management London, England 5,077 17 5,077 17 244 275 Linchris Hotel Corp. Hanover, Massachusetts USA 5,070 35 4,415 34 245 240 CSM Corp. Minneapolis, Minnesota USA 5,051 32 5,176 33 246 225 BD Hotels New York, New York USA 5,000 29 5,600 28 247 254 GruppoUNA (Atahotels SPA) Milan, Italy 5,000 38 4,750 43 248 248 Raymond Management Co. Middleton, Wisconsin USA 4,976 36 4,976 36 249 249 New Otani Co. Tokyo, Japan 4,926 19 4,926 19 250 234 Louis Hotels Public Co. Nicosia, Cyprus 4,924 24 5,398 24

32 September 2019 • HOTELS’ Investment Outlook • www.hotelsmag.com NEW YORK

L O S A N G E L E S • M E X I C O C I T Y • NEW YORK • L O N D O N • PA R I S • D U B A I • H O N G K O N G • B O R A B O R A DEVELOP AN NEW YORK ICONIC BRAND THATDEVELOP CONNECTS AN ICONIC GUESTS BRAND WITH DEVELOP AN ICONIC BRAND THETHAT WORLD’S CONNECTS BEST GUESTS DESTINATIONS. WITH THETHAT WORLD’S CONNECTS BEST GUESTS DESTINATIONS. WITH Powered by InterContinental Hotels Group (IHG ®), the InterContinental ® Hotels & Resorts brand is an iconic symbol of sophistication and glamour. Connecting well-traveled guests to THE WORLD’S BEST® DESTINATIONS.® thePowered elements by InterContinental that make each InterContinental Hotels Group (IHG Hotel), thedestination InterContinental special, the Hotels brand & promise Resorts is tobrand offer is meaningful an iconic symbol and unique of sophistication experiences andfor travelersglamour. who Connecting appreciate well-traveled cultural discovery guests to Powered by InterContinental Hotels Group (IHG ®), the InterContinental ® Hotels & Resorts andthe elements knowledge. that Hotels make areeach located InterContinental in key global Hotel destinations, destination offering special, owners the brand a luxury promise is brand is an iconic symbol of sophistication and glamour. Connecting well-traveled guests to brandto offer platform meaningful with and design unique flexibility. experiences for travelers who appreciate cultural discovery andthe elements knowledge. that Hotels make areeach located InterContinental in key global Hotel destinations, destination offering special, owners the brand a luxury promise is brandto offer platform meaningful with and design unique flexibility. experiences for travelers who appreciate cultural discovery andTo develop knowledge. your Hotelsnext project are located with us in contact: key global destinations, offering owners a luxury branddevelopment.ihg.com platform with design| [email protected] flexibility. To develop your next project with us contact: development.ihg.com | [email protected] To develop your next project with us contact: development.ihg.com | [email protected]

©2019 InterContinental Hotels Group. All rights reserved. Most hotels are independently owned and operated.

©2019 InterContinental Hotels Group. All rights reserved. Most hotels are independently owned and operated.

©2019 InterContinental Hotels Group. All rights reserved. Most hotels are independently owned and operated. FEATURE HOTELS

2018 2017 2018 2018 2017 2017 rank rank Company Location Rooms Hotels Rooms Hotels 251 - SilverBirch Hotels & Resorts Vancouver, Canada 4,904 17 - - 252 260 Atlas Hotels Stratford-upon-Avon, Engand 4,877 48 4,622 47 253 239 Grand Skylight Hotel Management Co. Shenzen, China 4,825 17 5,227 23 254 247 Verkehrsbüro Hotellerie Vienna, Austria 4,822 27 4,979 29 255 - Red Planet Hotels Bangkok, Thailand USA 4,783 30 - - 256 - Vision Hospitality Group Chattanooga, Tennessee USA 4,775 47 - - 257 276 Hoteles Servigroup Benidorm, Spain 4,758 18 4,406 17 258 - Ligula Hospitality Group Goteborg, Sweden 4,719 39 - - 259 258 Transamérica Hospitality Group São Paulo, Brazil 4,677 23 4,677 23 260 290 Vista Host Houston, Texas USA 4,667 39 4,137 34 261 269 Coast Hotels Vancouver, Canada 4,645 36 4,482 35 262 217 Evergrande Hotels & Resorts Guangzhou, China 4,625 10 6,018 18 263 266 Korea Tourism Organization Seoul, South Korea 4,625 52 4,501 50 264 263 Lodging Hospitality Management St. Louis, Missouri USA 4,623 17 4,522 18 265 265 Compass Hospitality Co. Ltd. Bangkok, Thailand 4,596 48 4,512 44 266 210 Urgo Hotels and Resorts Bethesda, Maryland USA 4,591 34 6,316 43 267 - Waramaug Hospitality Boca Raton, Florida USA 4,585 39 - - 268 287 Waterford Hotel Group Waterford, Connecticut USA 4,564 33 4,167 30 269 - Strand Hospitality Services Myrtle Beach, South Carolina USA 4,563 39 - - 270 270 Texas Western Hospitality Dallas, Texas USA 4,539 36 4,470 36 271 264 Magna Hospitality Group Warwick, Rhode Island USA 4,517 22 4,517 22 272 267 Falkensteiner Hotels and Residences Vienna, Austria 4,502 32 4,499 32 273 - CoralTree Hospitality Englewood, Colorado USA 4,486 19 - - 274 - Sun International Sandton, South Africa 4,454 16 - - 275 273 Galaxy Entertainment Group Hong Kong, China 4,420 5 4,420 7 276 - HRI Lodging New Orleans, Louisiana USA 4,417 25 - - 277 - Regency Hotel Management (Ramkota) Sioux Falls, South Dakota USA 4,415 33 - - 278 187 Budget Suites of America Las Vegas, Nevada USA 4,354 12 6,997 19 279 - Arp-Hansen Hotel Group Gentofte, 4,350 13 - - 280 - Delaware North Buffalo, New York USA 4,346 32 - - 281 - Grand Heritage Hotel Group Estes Park, Colorado USA 4,325 22 282 281 Palace Resorts Miami, Florida USA 4,315 10 4,315 10 283 245 Xanterra Travel Collection Greenwood Village, Colorado USA 4,283 26 5,021 33 284 282 Kerzner International Resorts New York, New York USA 4,279 12 4,279 12 285 - Brazil Hospitality Group Rio de Janeiro, Brazil 4,225 19 - - 286 - Auberge Resorts Collection Mill Valley, California USA 4,216 18 - - 287 289 Playasol Ibiza Hotels Ibiza, Spain 4,192 33 4,137 36 288 288 New York, New York USA 4,146 17 4,146 17 289 - Achat Hotels Hockenheim, Germany 4,125 35 - - 290 293 Sandos Hotels & Resorts Playa Blanca, Spain 4,122 9 4,122 9 291 286 RIMC International Hotels & Resorts Hamburg, Germany 4,116 25 4,180 35 292 - Berjaya Hotels & Resorts Kuala Lumpur, Malaysia 4,106 16 - - 293 295 Starhotels Florence, Italy 4,100 29 4,092 29 294 259 ZMC Hotels Duluth, Minnesota USA 4,096 39 4,663 41 295 299 Daly Seven Greensboro, North Carolina USA 4,084 39 3,970 38 296 271 Venezolana de Turismo Caracas, Venezuela 4,084 14 4,427 16 297 257 Lindner Hotels Duesseldorf, Germany 4,056 31 4,693 30 298 - Melco Resorts & Entertainment Hong Kong, China 4,000 5 - - 299 262 Meyer Jabara Hotels Danbury, Connecticut USA 3,973 23 4,551 29 300 285 H-Top Hotels & Resorts Group Barcelona, Spain 3,948 17 4,225 18

34 September 2019 • HOTELS’ Investment Outlook • www.hotelsmag.com THE MOST AWARDED ALL-INCLUSIVE RESORTS

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TOP 25 CONSORTIA

2018 2017 2018 2018 2017 2017 ranking ranking Company Location Rooms Hotels Rooms Hotels 1 1 Hotusa Hotels Madrid, Spain 269,760 3,032 230,453 2,726 2 2 Associated Luxury Hotels Orlando, Florida USA 228,045 597 195,484 647 3 3 Preferred Hotels & Resorts Chicago, Illinois USA 150,349 751 160,000 700 4 4 Keytel Hotels Madrid, Spain 136,795 1,288 135,133 1,297 5 5 Dubai, United Arab Emirates 124,161 591 126,120 623 6 6 HotelRez Hotels and Resorts London, England 86,127 981 80,593 946 7 - Historic Hotels Worldwide Washington, D.C. USA 65,000 330 - - 8 - Historic Hotels of America Washington, D.C. USA 60,000 310 - - 9 9 Hotel Republic London, England 58,544 270 45,218 215 10 7 The Leading Hotels of the World New York City, New York 57,225 406 60,102 378 11 10 Logis Hotels Paris, France 45,626 2,200 44,311 2,122 12 8 Supranational Hotels London, England 37,725 300 60,000 500 13 11 Epoque Hotels Miami, Florida USA 27,745 304 27,615 301 14 - Amplified Hotels London, England 27,145 138 - - 15 12 Small Luxury Hotels of the World London, England 25,078 535 24,038 520 16 13 Berlin, Germany 22,144 327 22,301 288 17 14 The Originals Human Hotels & Resorts Paris, France 19,057 548 22,000 600 18 15 Sercotel Hotels Barcelona, Spain 17,834 154 17,834 174 19 17 Relais & Châteaux Paris, France 14,379 580 13,650 550 20 20 Bespoke Hotels Warrington, England 14,000 138 9,555 207 21 19 Hotels & Preference Paris, France 10,275 150 10,275 150 22 22 Les Collectionneurs Issy-les-Moulineaux, France 9,120 357 9,000 338 23 23 Healing Hotels of the World Köln, Germany 7,687 82 8,393 101 24 24 Romantik Hotels & Restaurants Frankfurt am Main, Germany 7,365 205 7,365 205 25 21 L.E. Hotels Los Angeles, California USA 5,600 65 9,234 73

36 September 2019 • HOTELS’ Investment Outlook • www.hotelsmag.com

Q&A

Headline Deck

ree minibars, rate credits, smiley and happy staff. Surely, this can’t Fbe the hotel business. But it is for Girish Jhunjhnuwala, whose Hong Kong-based Ovolo Group, with about a dozen properties, continues to expand in Hong Kong and Australia with an eye toward New Zealand, Bali and Los Angeles. “When you start working toward what the customer really wants, the bottom line follows versus focusing on the bottom line first and then seeing what helps your guests,” says Jhunjh- nuwala, who marches to his own ’80s music beat that plays in his Ovolo and Mojo Nomad hotels. HOTELS’ Investment Outlook recently interviewed Jhunjhnuwala about his plans and his unique approach to hotelkeeping.

HOTELS’ Investment Outlook: You talk a lot about not nickel-and-diming your guests. Can you elaborate? GIRISH JHUNJHNUWALA: You should be able to enjoy what there is; you paid for the room, and that’s how the whole concept started with the free minibar, free and free social happy hour. This is very important, and we just came up with our new NFW policy, which is you get the best rate no matter & when you book. Q A: It’s part of our effortless living Nurturer of team approach. You leave everything to us, we do the thinking, we take care of things for you… We have a very strong and guests return customer base. In Hong Kong, By Jeff Weinstein, editor in chief we have about 20% return customers, and in Australia, it’s probably 30% because it’s a more domestic market. Ovolo Group’s Girish Jhunjhnuwala creates a vibe that puts team and guests first, believing profit will follow. HIO: Can you explain your “shiny, happy people” company culture? GJ: We talk about karma, but I think it’s

38 September 2019 • HOTELS’ Investment Outlook • www.hotelsmag.com Q&A

more about allowing people to do what they think is right. We have fun with what we do — that’s the most important part of it all... We’re nimble. As a small company it’s important that we are able Lobby at Ovolo Central to do things quickly and drive it through in Hong Kong the organization — and have fun over it… We set out a bottle of wine and we talk through everything. That’s when “We set out a bottle of wine and we talk through it becomes interesting because you get more ideas from people. You may have everything. That’s when it becomes interesting because started with a seed, but it’s more about you get more ideas from people.” – Girish Jhunjhnuwala the people who come next to water and nurture it. will help our guests, and it’s been doing GJ: It’s shared accommodation and HIO: Talk about the portfolio and extremely well. very well appointed, although only 20% how it’s performing. is shared, while 80% remains private. GJ: We have four properties in Hong HIO: Where will growth come from next? Guests stay for an average of four to five Kong and seven in Australia, with GJ: We just basically follow our demo- nights because of the common com- another two more (Ovolo South graphics to understand where they go. munal spaces in the lower floors. In the Melbourne and Mojo Nomad South We’ve been looking at assets in Los common areas, people can make their Yarra in Melbourne) that should be Angeles for Ovolo because Los Angeles own food, hang around and work, and ready by late 2020… The properties is a large piece of our inbound Austra- that just makes it a lot more comfortable have been performing very well. Hong lian business. We’re also looking into for them for a longer stay. Kong has been doing very well. The New Zealand and Bali, Indonesia. Mojo Nomad is a good product, average number of nights has gone up We are starting to look at manage- except not being able to get the right quite a bit in Hong Kong, as well. GOP ment agreements — we’ve got one in properties to expand it as easily. We in Hong Kong its at around 60% and Melbourne. We also continue to look at still continue to look for opportunities Australia sits at 50%. the leases. with possibly one more coming in next year. But we’re still working on HIO: Tell us about your approach to F&B. HIO: How are you funding expansion? the model… It’ll be a slightly slower GJ: We run it like a separate operations GJ: We’ve been funding ourselves and profile and get more traction in the center. It’s doing extremely well, and so we continue to do that. We know that at next three or four years… Once the are our event spaces. some point we’re going to have to look at presence is strong, more people will We’ve gone slightly more specialty. a capital raise, and we have been toying start liking the product. For example, in Sydney, we’ve with the idea. We’ve been approached introduced vegan dining. In our other by several PE firms to see whether we’d HIO: What do you think hoteliers should Sydney property we just keep bringing be interested. To be honest, we are more stop doing? in very specialized menus — more like interested in a long-term arrangement GJ: They should stop thinking about no-fuss eating. It's more of a fun dining — more than a 10-year horizon. So that what a traditional hotelier is thinking concept with signature cocktails… would mean more going into sovereign about. They should change their mind- We also have Veda at our Hong Kong funds or pension funds and so on. set and look at it from a different point Central location, a vegetarian restau- of view — that things are changing fast rant. There are so many choices in the HIO: How is your hybrid Mojo Nomad and we have to start really looking at area, so we focus on something that performing? what our customers think they want.

www.hotelsmag.com • HOTELS’ Investment Outlook • September 2019 39 CONSTRUCTION

INNOVATING with steel-framed modular Advantages and limitations of an emerging construction process

s modular construction requirements are more than five floors. grows in popularity, there are As the construction industry con- Amany variables to consider tinues to adapt to new building energy about the technique that help deter- standards, it is also looking for ways to mine the validity of each project and implement more recycled materials and expected investment. to reduce waste. Modular, in general, Some better-known advantages has a large advantage when it comes include decreased construction time, to improved energy standards over a improved quality and budget, mini- standard framed building due to the mized disturbance and impact at the tight and precise construction assembly site, improved thermal and acoustical — with the added benefit of equating to ratings, and reduced waste. However, higher STC (sound transmission class) there are also challenges such as and IIC (impact insulation class) ratings. early commitment to factory times, Steel modular already can utilize increased initial capital commitment more recycled material in construction before construction begins, site prox- compared to wood modular, and can imity to a modular factory, limits to reduce construction waste — important heights and widths during fabrication to consider when looking to meet certain and transportation, and challenges energy and LEED standards. within authorities having jurisdiction. Some other major limitations The next phase in the modular of modular construction have been industry, steel framed modular, builds proximity to the modular factory and on current efficiencies and addresses transportation. With wood-framed many of the challenges. Ultimately, construction, the units have a tendency it increases flexibility and opportu- to move and flex during transport, nities for this construction method. resulting in additional work on site and Even though it is the next evolution of limiting the distance that many want to modular construction, many builders haul the units. in the United States have not seen a The benefits of steel Some of the best examples of steel multi-story modular building, creating modular construction modular construction come from resistance to what is not familiar. Poland. Shipping via cargo ship to the One of the greatest advantages with opens up the door to a closest port and transporting is rela- steel framed construction is the sense of number of projects which tively easily to any location in the U.S. ease and safety for permitting agen- are urban infill or located This allows for larger flexibility and a cies knowing that the construction is wider variety of projects and locations. non-combustible. This provides a great within cities where the As we continue to push the evo- advantage with first-time inspections design requirements are lution of construction, technological and the critique of meeting life-safety advances in construction methods and requirements. It also allows for steel more than five floors. transportation will play a major role modular to be used for midrise and even – Andrew Twetan in the steel framed modular industry, high-rise construction. You can see some which I anticipate will play a major examples of this in New York. part in the future of the construction. Steel modular construction opens the door to projects that are urban infill Contributed by Andrew Twetan, Connor & or located within cities where design Gaskins Unlimited, Naples, Florida

40 September 2019 • HOTELS’ Investment Outlook • www.hotelsmag.com

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