Best Western Modifies Prototype for Extended-Stay Concept

Best Western International has revised its plan to enter the extended-stay hotel market, chain officials told members Saturday during the 2013 Best Western North American Convention. Executives introduced a new prototype for the product that calls for 100% extended-stay rooms, expanded common areas and a focus on exterior landscaping.

Best Western's previous concept allowed for a mix of extended-stay units and traditional transient rooms.

"It was a clever idea, but it was impossible to build," said Ron Pohl, senior VP of brand management and member services, during a media roundtable. "We wanted to provide a turnkey solution for developers, which is what the new prototype does. Also, we believe a product with a mix of extended-stay and regular rooms could cause confusion among travelers."

The new prototype is available for development, although Best Western has yet to decide on a name for the new product or announce any deals. It will be positioned in the upper-midscale segment of the market as an extension of the Best Western Plus descriptor.

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"Travelers like the extended-stay hotels, and developers like to build the product," said David Kong, president and CEO. "We wanted to make (the prototype) most appealing to consumers and most profitable to developers."

According to Pohl, the new design includes "more community elements and an (optional) lobby bar, and 100% of the guest units have kitchenettes." He said the new design resulted in a lower cost of construction to between $90,000 and $100,000 per key, depending on the market.

The prototype is a 56,000-square-foot building on a site that's a little less than two acres. The hotel has 86 units, ranging in size from 330-square-foot king-bedded studios to 565-square-foot queen/queen suites. All units have cook tops, sinks, microwaves and refrigerators.

The 1,850-square-foot, 63-seat lobby serves as a breakfast area, communal seating space and, in some properties, a lobby bar. The properties will have a meeting room that's divisible into two spaces, a business center and a sundries shop.

5,000 hotels by 2016
About half of new properties joining Best Western are outside North America. The global pipeline of 400 properties includes development efforts in South America, Asia, Africa and Europe. In North America, 120 hotels will join the system this year, with 140 additions projected in 2014.

Pohl told the convention audience Best Western expects to increase its roster from approximately 4,000 global hotels to 5,000 properties by 2016, which is the chain's 70th anniversary.

The chain's descriptor strategy is achieving "critical mass" for both its Plus and Premier descriptors, Kong said. There are nearly 900 Plus properties and 25 Premiers in North America, and 80% of hotels joining the system are in the Plus category.

"Some hotels joining the system could qualify as Best Western Premiers, but owners choose to designate them as Plus because they feel it's the best way to position the properties to compete in their marketplaces," Kong said. "There is no optimal mix between Plus and Premier. The reason for the descriptor strategy is to empower members to be as successful as they can."

Growth for the chain is happening across the globe, said Suzi MacDonald-Yoder, VP of international operations for Africa, Europe and Latin America. The chain expects to have 40 hotels in South America over the next four to five years. Brazil and Colombia are key growth areas in the region.

There are six Best Westerns in Russia, and MacDonald-Yoder said six more, all conversion properties, will open this year or next, and the chain will have 25 hotels in the country by the end of 2015.

European growth is also robust: Plans call for 20 hotels per year in France, 15 per year in Germany and 10 per year in Italy, she said.

Additionally, 35 mostly conversion properties are in the pipeline in China. Additions to the chain in Thailand, Indonesia and the Middle East will be mostly new construction, with a 50/50 split between Plus and Premier properties.

"We're finding a saturation of hotels in gateway cities in China and India, but we believe there is a lot of potential in second- and third-tier cities," Kong said.

Source: Hotel News Now

Editor's note: Best Western International paid for all travel expenses to the chain's annual convention, including airfare, transportation and hotel accommodations. Complete editorial control was at the discretion of the Hotel News Now; Best Western had no influence over the coverage provided.

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