QUALITY GROWTH
Mark Williams, group president of Vantage’s midscale and upscale brands, provided a development update for attendees. ABVI introduced a next generation prototype last December, and the first with the new look is slated to open in February in Galveston, Texas. In total, there are 13 new construction hotels in various stage of development for ABVI, Williams said. “Industry-wide, the conversion market has slowed down, however, we’re experiencing continued growth with premier properties in major markets,” he said.
Vantage has initiated a sales strategy to reconnect with Jameson Inns owners and bring the brand back to its glory days, Williams added. The first two conversions were in Georgia, with more in the pipeline.
To grow the Lexington brand in major markets across the country, Vantage is taking a hub-and-spoke approach. “We want to put our properties in markets we can expand from, primarily in markets where it’s high in volume of consumers,” Bloss said. Vantage is now developing significant projects in strategic locations using the new Lexington prototype. Over the summer, for instance, Vantage’s development group acquired a 323-room former Wyndham resort in Jacksonville, Fla., and converted it to a Lexington Hotel and Convention Center. The property is currently undergoing a major renovation to become the one of the brand’s flagship conference center hotels. “We see great opportunities with Lexington, so we’re investing our money on bricks and mortar with many new projects,” Williams said.
The first new construction Lexington opened in Effingham, Ill., Williams said, and construction is slated to begin soon on a 150-key Lexington in Fort Lauderdale, Fla. Other new construction properties are in the works in Salinas, Calif., and Scotts Valley, Calif. A number of conversion properties also joined the Lexington system this year, such as Aurora, Colo., and a Sacramento, Calif., hotel that is undergoing a substantial renovation.
Vantage is seeing strong international growth as well. After a multimillion-dollar renovation, the Lexington Klapa Resort in Bali, Indonesia opened in February. Vantage also is finalizing a deal in Jakarta for five more hotels. In South Korea, there are two new construction projects for Value Hotel Worldwide, which makes five premier properties open or under construction in the country. And after signing a master licensing agreement with Miraya Hotel Management in April for Value Hotel and Value Inn Brands in India, everything is in place to begin branding there next year, Bloss said.
In addition to a steady development push, Vantage will continue to remove underperforming properties from the system. In 2015, the company let go of the bottom 10 percent, Bloss said.
BEST FOOT FORWARD
Vantage executives encouraged owners to take advantage of the healthy economy and invest in renovations now before they miss the upside. “While you have the money, let’s put it in your property,” Bloss said. “The return on investment and guest satisfaction are there.” In a scenario shared on stage, an approximately $200,000 renovation for a 60-room hotel could increase ADR by $7, occupancy by 4 points, yearly revenue by more than 15 percent, and overall business value by 15 percent, generating a five-year project return on investment in excess of 200 percent.
As owners strive to remain competitive in their marketplace, Vantage continues to look for new avenues of growth, so long as they are the right fit. That could mean acquiring another brand or family of brands in the future. “We’re not looking to buy to grow, we’re looking to buy to strategically grow,” Bloss stressed. “There’s a big difference.”
