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Interview with Martin Armitstead, Wyndham Hotel Group Senior Vice President of Development, EMEA: "Acquiring Tryp was ideal"

Growing our managed portfolio is certainly a goal of ours and we continue to educate owners on the services that we provide. There’s no question that 2009 was a challenging year for hotel developers. Wyndham Hotel Group currently has a very strong and diverse pipeline, consisting of approximately 980 hotels and 107,600 rooms, 54 percent of which are new construction and 49 percent of which are international.

HTR Magazine : Among the Top 5 worldwide hotel groups, Wyndham is the one with the smallest net growth of inventory in 2009 with less than 5,000 rooms. How do you explain that situation?

Growing our managed portfolio is certainly a goal of ours and we continue to educate owners on the services that we provide. In addition to Wyndham Hotels and Resorts properties, we’ve begun marketing our management services to select hotels under our other flags and are already starting to see success, as is the case with several Ramada and Days Inn properties that we have under development. That said, as we continue to grow this part of our business, we’re committed to being selective in the hotels that we manage. Among other things, we want to ensure that we are not in direct competition with our franchise partners, that it makes economic sense and that we are able to add value.There’s no question that 2009 was a challenging year for hotel developers. Reduced financing for new construction hotels combined with increased difficulties for hotel/asset transfers resulted in fewer new build and conversion opportunities. In addition, terminations as a result of bankruptcy and non-payment increased. Despite these difficulties, we still grew the size of our system and continue to do so. We have nearly 7,200 hotels and approximately 607,000 rooms.HTR: Are you satisfied with the scope and the diversity of your pipeline? Are there brands that you would try to push further; areas of the world where you would like to increase your presence?Wyndham Hotel Group currently has a very strong and diverse pipeline, consisting of approximately 980 hotels and 107,600 rooms, 54 percent of which are new construction and 49 percent of which are international. While we’re always looking to add to those numbers, the most important factor for us is making sure that we’re working with the right developers to place the right hotels in the right locations under the right brands. Because our offerings range from economy and midscale to upscale, luxury, resort and extended stay, we’re able to provide developers with a product for nearly every type of project. Geographically, continuing to grow our portfolio outside of North America remains a top priority. The recent addition of Tryp gives us another great brand, strong coverage in Spain and additional representation in other countries such as Germany and France. Moving into management deals in select regions will help open new doors as well.HTR: Are you still confident in the potential of emerging countries, such as the BRIC, but may be also Africa, the Middle-East?Our confidence in the potential of emerging countries remains quite high, particularly in areas like China, India, and the Middle East. As a point of reference, in little over a year, we’ve grown from having 183 hotels in China to 250. In addition, we’ve signed up our first Days Inn in Moscow earlier this year and have just received approval for two additional hotels in Russia and more in the pipeline. We are a market leader in both Turkey and Romania, and continue our expansion there in a solid way. Currently Africa is not a focus area for us, nor will we be taking a proactive position there in the short term. That said, we will continue to respond to excellent opportunities, such as the one in Nigeria, where the international market to the country is sufficiently strong and we know we can add value.HTR: Is China and the surrounding countries a priority on your development list?The Asia Pacific region in general and China specifically are definitely a high priority on our development list. We currently have 250 hotels in China under 5 brands: Wyndham Hotels and Resorts, Ramada, Howard Johnson, Days Inn and Super 8.Of those 250 hotels, Super 8 accounts for 148 and continues to see strong interest. Other brands in the region also continue to see modest growth. In the last year, we’ve opened four Wyndham Hotels and Resorts properties in the region, and presently have several others currently under development.HTR: Most of your brands are very strongly established in the US, which are the ones you count on to grow as a global hotel group?Currently, eight of our 12 hotel brands operate outside of North America, however of those eight, the main anchors of our international growth are Wyndham Hotels and Resorts, Ramada, Days Inn, Super 8, Howard Johnson and Tryp by Wyndham.HTR: Apart from Ramada and Wyndham, your presence in Europe is not very strong. Do you think it is too late to gain significant market shares?Wyndham Hotel Group is still fairly young as an international hotel company and yet we currently have over 300 hotels throughout Europe alone. While Ramada and Tryp by Wyndham are currently our largest in Europe, we continue to see strong interest in our other brands, including Days Inn, which has a significant footprint in the U.K. Moving forward, we’re confident that our overall footprint in Europe will continue to see steady growth, which is evidenced by the increased operation and development resources we’ve begun devoting to the region over the last couple of years. In addition, it’s worth noting that in some countries we are the market leader, as is the case with Romania and Turkey. We are looking to grow but want to do so in a very smart way.HTR: Did you need to add the Tryp brand to complement your portfolio or was it the only way to establish a first strategic base in Continental Europe?Acquiring Tryp was ideal for us, particularly because in addition to already having a strong global presence it fit nicely within our portfolio and complimented our other offerings. Since becoming a global company, we’ve been fortunate to have strong brands like Ramada and Days Inn to help establish us as a player in countries throughout Europe. Now, with the addition of Tryp by Wyndham, we are able to further build upon those offerings. HTR: When most of the world hotel groups are claiming their “asset light” new economic model while accelerating their development through franchise, do you consider you are still ahead of them with a long experience in the field of franchising?Wyndham Hotel Group is the world’s largest hotel company, with more than 7,200 hotels throughout the globe. We are also the world’s largest hotel franchisor, which means we not only have a wealth of knowledge and experience when it comes to helping our franchisees succeed, but that we are able to leverage our scale and expertise in order to do so. Whether it is providing property-level training resources, marketing guidance, tools to better manage revenue, or significant cost savings on furniture and fixtures, our goal is to help owners succeed.HTR: How do you think you can increase loyalty to your brands, apart from producing results?To create loyalty, a franchisor needs to constantly be evaluating and evolving the services and tools that it provides to its franchisees, better enabling them to succeed. A franchisor also needs to be in touch with the needs of their franchisees. This might mean helping them through a challenging economy by modifying standard implementation deadlines, as we did in 2009, or working with them to identify and improve their hotel and their business, as we do on an ongoing basis. If we can enable a franchisee to make their business the best that it can be, why work with anyone else? Their success is our success.HTR: While acquiring the Wyndham Hotel brand, Cendant at that time acquired also some kind of expertise in managing hotels. Is this a direction that Wyndham Hotel Group would like to take?

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