Jack DeBoer, father of the extended-stay hotel concept, has racked up a long list of achievements during his 50 years in the business. Retiring is not an option for the 83-year-old entrepreneur, who founded the Residence Inn, Summerfield Suites, Candlewood Suites, and Value Place extended-stay brands. Never one to rest on his laurels, DeBoer and his team of Wichita-based hospitality professionals introduced a new franchise concept in October called WaterWalk Hotel & Apartments. The all-inclusive brand combines the most appealing features of an upscale, extended-stay hotel with the lifestyle of apartment living. With one property open in Wichita and 35 others in the pipeline, DeBoer could have another hit on his hands.
Where did the idea for WaterWalk come from? When I decided to get back in the apartment business, I looked at what was out there and found that the industry didn’t learn anything in the 40 years since I left. Developers are still building the same stuff. I thought, there has to be a better way. So we coupled the quality of the lodging world with the space of the apartment world and came up with the all-inclusive.
After developing four successful brands, why start working on a fifth? I really saw an opportunity to blend all the things we’ve learned over the years. With this product we’re going after a much smaller share of the apartment world, because there’s a lot of supply out there. We’re going after the corporate lodging industry, which is a tough business to make any money at and doesn’t deliver much real value to the stayer. And, of course, we want to get back into the upscale extended-stay business. So we blended them all together and built a model here in Wichita, and it’s doing really well. It only takes a small share of each of those three industries to create something that’s profitable.
Looking back, what motivated you to create the extended-stay hotel concept? In the early ’70s, the apartment business was very tough. Interest rates were killing any new development, and I thought, if we could have apartment costs and get lodging rates, we would have a good thing. So that was the beginning of Residence Inn. We really didn’t know what we were doing, but it turned out to be a really important part of the lodging world. So we stumbled into it, but then it turned out to be an industry.
How has the segment changed since you opened the first Residence Inn in 1972? [The hotel industry] redefined extended stay along the way and decided that was five days or more. I’ve been searching through calendars frantically trying to find a five-day week, and I’ve been unsuccessful so far. To us, extended stay is seven days. It’s the only way you can flatten the bell curve.
You’re still chairman of Value Place. Are you pleased with where the company is headed? I’m very happy with Value Place. Things are really cooking over there. In January, we announced the sale of 25 franchises in the state of Washington. We’ve got 200 of them open, they make money, and there’s no ego in it. There are entrepreneurs, and there are managers. There are no entrepreneurs who are worth a damn as a manager, and there are no managers worth a damn as an entrepreneur. Now that the business is mature, managers run it, and they do it a whole lot better than I ever did.
You sold Residence Inn to Marriott, Summerfield to Hyatt, and Candlewood to InterContinental Hotels. Was it difficult to give up brands you built? I think the three brands I’ve sold have all done very well in the hands of others. People say, “Why did you sell Residence Inn?” I say, “Marriott thought it was worth more money than I did, and it turned out they were right.” I think Residence Inn really sticks to their knitting. They improved the product a lot, and they’ve got a wonderful brand in Marriott, but the delivery and operating systems are still the way they’ve been for all these years. At Candlewood, they haven’t changed the box much, but they changed the operating system. And at Summerfield, there’s not much left of what it was, because [Hyatt] moved away from the extended-stay business. I don’t criticize any of these guys. As long as they continue to make money, more power to them.
So you’re the idea man. I’m a true entrepreneur. My book, Risk Only Money, which has been out about two years, is doing really well, because it’s all the stuff I learned the hard way. Friends of mine who have now retired from running big companies read the book—because they don’t have anything else to do—and say to me, “I wish I had read this 30 years ago.” And I say, “Hey, me too.”
