YOTEL has announced global expansion plans targeting key city centers and international airports in Asia, Europe and North America. More than 3,000 cabins are scheduled to open by 2018, including YOTEL hotels in Singapore, Paris, Miami, San Francisco and a second property in New York City.
Commenting on the expansion, YOTEL’s CEO Hubert Viriot said, “YOTEL has created a niche product for affordable luxury. Since the opening of our first hotel in 2006, YOTEL has accommodated over 1 million visitors and collected invaluable insight on both our guests’ expectations and our investors’ requirements. Today, YOTEL has the solid foundation and proven track record to expand globally.”
Initially conceived for busy international travelers at airport terminals, YOTEL’s concept proved successful in urban centers with the opening in 2011 of the 669-room YOTEL Times Square developed by Related Companies, one of New York City’s most prolific developers. Designed around the customer, YOTEL cabins deliver affordable luxury without the clutter through small but smart spaces, providing everything for a guest to relax, refresh, sleep and connect. Typically located in easily accessible, fast upcoming neighborhoods, YOTEL hotels offer a sense of community as well as space for work and social gatherings, and provide an ever-improving guest experience.
Viriot noted, “At YOTEL, we are focused on both hospitality and real estate principles. Our business model delivers up to two times as many rooms than traditional brands, and our cabin standards are on par or superior to most upscale hotels. Our guest experiences are both comforting and inspiring, remindful of first class travel. As a result, guest retention rates at our properties are extremely high with occupancy rates above 90% across our portfolio, and returns to our investors are attractive.”
With the support of its major shareholder, Kuwait-listed IFA Hotels & Resorts KSCC, YOTEL continuously invests in its operating platform, improving its distribution channels and digital infrastructure, and expanding a dedicated team of industry professionals across its three regional offices in London, Boston and Dubai.
The brand’s development team – led by CDO Jason Brown – is constantly reviewing new sites, partners and investors. Typical of the brand, each hotel has its own innovative identity, but is built upon YOTEL’s unique cabin concept and its use of digital technology.
Brown noted, “The YOTEL business model is exceptionally attractive to a wide spectrum of investors, ranging from institutional to family offices. Our partners are typically well-versed at real estate, often new to hospitality, and are drawn to YOTEL’s efficient layouts, lean operations and high-margin room revenue.”
In addition to New York, Miami and San Francisco, YOTEL is in advanced negotiations to operate new properties in Boston, Atlanta, Austin, Chicago, Los Angeles, Seattle and Toronto. Outside North America, the company is actively pursuing opportunities in Europe and Asia Pacific, in particular Dubai, London, Milan, Barcelona, Sydney and Hong Kong.
Brown added, “One third of the company’s future growth is anticipated to take place within airport locations, with the other two-thirds planned for city centers. We primarily operate through long term management contracts, but we can also entertain alternative deal structures such as leases, particularly in airport environments. Our preference is to remain asset light, investing in our operating capabilities and regional platforms to deliver unique experiences to our guests and superior returns to our owners.”
YOTEL’s next 3 locations to open in the U.S. are in Miami, Brooklyn’s Williamsburg and San Francisco’s Mid-Market neighborhood. New York-based real estate developer Synapse Capital is developing a 100,000 square foot mixed-use project along with 110 YOTEL cabins in the heart of Williamsburg, Brooklyn. Together with IFA Hotels & Resorts and its partners, Synapse is also transforming the Grant Building at 1095 Market Street in San Francisco into a 200-cabin YOTEL hotel. YOTEL Miami is a 250-cabin hotel being developed by Aria Development Group in partnership with AQARAT (Kuwait Real Estate Company) in the heart of Downtown Miami.
In Europe, YOTEL is developing its fourth airport hotel at Paris Charles de Gaulle airport, which is due to open in mid-2016. The following year, YOTEL will open its first property in Asia with the launch of YOTEL Singapore on ultra-prime Orchard Road. Developed by Singapore-listed Hong Fok Corporation Limited, YOTEL Singapore will feature 600 state-of-the-art cabins located at the heart of the city-state’s busiest commercial strip and steps away from all major tourist attractions.
