Toes in the Sand for 70 Years: Outrigger’s Transition To Outrigger Hospitality Group

Outrigger Waikiki Beach Resort
Outrigger Waikiki Beach Resort

Since becoming president and CEO of Outrigger Hotels and Resorts last spring, Jeff Wagoner has focused on growing the 70-year-old Hawaii-based company while maintaining the “toes in the sand” identity of its premier beach brand, Outrigger. The company’s latest move, which it announced in late January, is its transition to Outrigger Hospitality Group.

The new name aligns with Outrigger’s multi-branded portfolio restructuring and its efforts to solidify its position in the beach resort industry. Wagoner told LODGING that to achieve positive growth, the key was forward-facing branding for the properties it owns or manages. “It was important to explain who we are and the type of properties we have,” he describes.

LODGING checked in with Wagoner at the 2019 Americas Lodging Investment Summit (ALIS) to discuss Outrigger’s positioning today and in the future.

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What steps are you taking to achieve that brand clarity, and with it, growth?
Outrigger has been around for 70 years, but the types of properties with which has been identified has changed—especially since our acquisition by KSL Capital Partners in 2016. Our portfolio now includes 38 hotels, condominiums, and vacation resort properties that are Outrigger operated, owned, or managed.

Because we now manage a diverse group of properties for other owners and brands in Hawaii—including Wyndham, Embassy Suites, and Best Western—while also now owning some hotels whose locations don’t qualify as “beachfront,” we now speak in terms of having three “lanes.” First is Outrigger’s premium brand, which is epitomized by the property in the Maldives, where there’s no question that it’s on the beach and is, in fact, the only business on the island. Next are our off-beach lifestyle properties, which are differentiated by having the By Outrigger brand. Finally, there is our management business through which we manage various non-Outrigger brands for other owners, and, thanks to our strong infrastructure in Hawaii, positions us well to manage more.

Taken together, we believe these three lanes—in combination with building upon our beach-centric identity—create significant clarity for us to be able to develop a growth platform

Are you focused on any specific growth opportunities?
When you look at growth opportunities, we have a pretty wide spectrum. Through our parent company, KSL Capital Partners, which invests in travel and leisure type companies, we can go out and acquire assets, we can find properties with which to have just a management agreement, or we can do something in-between.

Right now, we’re very Hawaii- and Asia Pacific-centric. As long as we continue to do well there, we’ll continue to grow there, but we’re also looking at California, Australia, and the west coast of Mexico.

Most of all, we want to stay focused on being a beach brand in beach communities, whether it’s on or off-beach. This is what we do—it’s our mission, our platform.

What are your priorities for 2019?
Our first priority is always to make sure current properties continue to perform well. We need to make sure that planned or in-progress renovations don’t distract us from doing a great job on the properties we have. To maximize the greater revenue stream sought through renovations, they need to be completed on time and on budget, followed by ramping up after the work is completed.

We’re currently in the process of a $200 million modernization of Outrigger’s Waikiki assets, and are just wrapping up a $35 million renovation of Waikiki Beachcomber by Outrigger. Next comes an $80 million of the Outrigger Reef Waikiki Beach Resort.

These three properties have a lot of mileage on them but each has a unique personality. With the already well-known Outrigger Waikiki and Outrigger Reef Waikiki, there were areas we needed to freshen in order to elevate the brand. In the case of the Beachcomber, which had previously been a Holiday Inn, the renovation was able to take that property to the next level; that overhaul transitioned it from a property with a rate ceiling into a spectacular lifestyle property.

What steps are you taking to sustain the environment and preserve the beauty of these areas that you’re in?
The company takes sustainability very seriously. Our OZONE program, which was launched in 2014, is a global conservation initiative centered on protecting the health of coral reefs and the oceans surrounding our beautiful beach destinations. One of our big initiatives when we started the OZONE program was to distribute to and educate guests about green-friendly sunscreen—i.e., those that do not contain the toxic sunscreen ingredients oxybenzone and octinoxate, which impact sea life and are linked to coral bleaching. We now brand an eco-friendly product with two partners and provide it to the thousands of guests who visit our hotels.

In some properties, such as the Maldives, we grow coral to try to replace it, and we also include the guests in growing that coral as a signature experience. There will be a heavy focus on sustainability in 2019. Things like growing coral are the types of things that really matter to our brand, not just any one hotel.