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A Numbers Game

Embassy Suites Continues Portfolio Refresh As Brand Celebrates 35 Years

Wednesday, March 13, 2019
Dennis Nessler
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There’s no shortage of milestones this year for Hilton as the mega-brand company prepares to celebrate it’s 100-year anniversary while its well-known Embassy Suites by Hilton brand reaches the 35-year mark in its own right.

But the full-service, all-suites brand has its eyes on some other numbers as well, specifically related to its atrium refresh as its portfolio of 253 hotels continues to work through the requisite renovations.

According to Alan Roberts, global head for Embassy Suites, roughly 110 properties have already completed the refresh with another 30 to 35 on tap for the redo this year. The renovation initiative--which was launched in 2014--is designed to transform the brand’s signature, open-air atriums into intimate social lobbies, while also enhancing guest suites, meeting spaces and other communal areas of the hotels.

Roberts emphasized the upscale brand’s flexibility as he talked about the milestone and some of the more recent changes.

“Part of the success of our 35 years and the success that we’ve seen has been the partnership we’ve had with our owners. I think that continues and that’s been a key to the success we’ve had in the last five years through everything that’s been going on with Atrium evolution. If you go back even a little further to 2007 when we launched a new prototype at the time the story of that was all about the flexibility that we were introducing to the brand and being willing to engage with our owners,” he said.

Roberts maintained that by the end of next year some 75 percent of the brand will be within six years of either a major renovation or having been built. He pointed out he expects the atrium refresh initiative to be completed in 2021 at which point the brand will resume “it’s normal pace of renovation work.” Roberts further added of the initiative, “We’re completely on target and where we thought we would be.”

The brand’s global head acknowledged that the atrium refresh is a considerable renovation that generally takes several months. However, Roberts went on to tout the brand’s flexibility and willingness to work with owners.

“This brand is so fun to me. It has a prototype and we have design narratives, but all of that is meant to be kind of your north star to how we envision it. It’s not meant to be exactly how you have to do it,” he said.

Roberts continued to stress the economic potential of the brand, particularly as industry growth continues to trail off slightly. “I want to make sure that the message is out that Embassy Suites is still a good investment. You can count on us to work with you through this time to land at a profitable place at the end of the day. We want to see those spaces re-energized through food & beverage,” he said.

Centralizing the food & beverage has been a major focus of the refresh. Roberts noted that some 17 locations have incorporated one of the brand’s new F&B concepts which include Brickstones, a contemporary full-service restaurant, and a fast casual dining concept called E’terie.

Roberts elaborated on the progress of the concepts.
“That is growing and we have more in the pipeline that are coming. We listened to owners tell us in the early days that it didn’t work for them, that it was too expensive,” he said, adding, “we took out those elements of expense.”

Meanwhile, the brand continues to add new hotels to the portfolio with three new properties expected to debut this year on the heels of opening 11 in 2018. According to Roberts, the brand inked 11 deals in 2018 as well and expects to sign as many as nine new deals this year. He added the is projected to open roughly 11 hotels in 2020 and 2010. “We’ve got a nice cycle going,” said Roberts.

While the lion’s share of the brand’s portfolio is in the U.S., Roberts pointed out that international growth is very much on its radar. In fact, the brand just this week made its debut in Aruba with the Embassy Suites by Hilton Aruba Resort slated to open in 2021.

Roberts added, “The brand is still trying to gain traction in Latin America.” He also mentioned that Canada remains very much a target for Hilton’s all-suites brands as it has some 30 hotels in the country, four of which are Embassy Suites properties.

Roberts also mentioned Columbia as a possible area of expansion for the brand. “It’s very exciting to me, because I want to see growth happen in that region. Columbia has one of the strongest growing GDPs in South America so it’s an exciting place to be,” he said.

The Middle East is also a region that the brand is targeting “because there is a market and the money is there for all-suites products and the type of upscale brand that Embassy is,” according to Roberts.

He pointed out that many of the developers of the brand are existing Hilton partners and touted the brand’s low cost of development and solid returns as key factors for the robust pipeline.

“The majority of our developers that are building new Embassy Suites hotels are coming out of the focused [service] or all-suites category of developers. They’re not first-time developers; they’re ready to customize. Embassy fits that bill for them because they have enough knowledge that they don’t necessarily follow the prototype to the ‘T’. They’re ready to escalate and move into that full-service brand so we make a nice bridge for them to do that,” said Roberts.

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Dennis Nessler    Dennis Nessler
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