Changes In Starwood Could Open Doors For Franchisees
Starwood Hotels & Resorts has been experiencing changes in management as their previous CEO stepped down in February, but even in the midst of it they are working to both improve and expand their brands. Particularly, they are focusing their efforts on their upper-midscale extended-stay and select-service brands.
We see this on the ground as almost half of their projected 2015 property openings coming under their Four Points, Element, and Aloft brands, which will make up 40 percent of their pipeline according to their Q1 earnings report.
Starwood's changes are not just opening the doors on new properties; they are also opening doors for would-be franchisees. The increasing demand for select-service hotels is driving their growth, offering growth to franchisees. In the first quarter, 22 of their 33 new deals were Aloft, Element, and Four Points properties. These deals brought the most growth for Starwood since 2008.
With deals like these comes the opportunity for small to mid-sized companies to get involved with the Starwood brand. While Starwood was previously best known for their luxury brands (e.g. W, Westin), these upper-midscale brands are bringing opportunities for management companies without excessive surplus capital at their disposal to take on a Starwood property.
For example, Zenique Hotels, which currently manages Holiday Inn Express & Suites, La Quinta Inn & Suites, and similar properties, is building its first Aloft hotel, marking the beginning of their relationship with Starwood.
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