Hotels unaware of scale of opportunity for conversion brands

12 September 2023 by
Hotels unaware of scale of opportunity for conversion brands

Hotel groups and independent operators have not fully understood the scale of the opportunity presented by conversion brands, an industry expert has said.

Speaking at the AHC Conference in Manchester yesterday (11 September), Richard Clarke from equity research firm AB Bernstein said conversion brands could benefit both larger groups looking to expand as well as smaller hoteliers.

He added: "It has been harder for hotels to get new-build supply open, but they have been offsetting the vast majority of that with conversions. We don't think hotels appreciate how big that conversion opportunity is."

He added: "Conversions help big brands deliver above-industry unit growth. We think that there are still tens of thousands of independent hotels that can join this."

It comes after IHG launched its midscale conversion brand Garner last month, which is set to expand globally to over 500 hotels over the next decade, starting in the United States.

In 2018, IHG launched upscale conversion brand Voco, which was introduced with an initial projection of 200 hotels by 2028.

Voco said it is "well within reach" of this aim already, with over 100 sites to date.

Julie Cheesman, head of Voco hotels at IHG Hotels & Resorts, told The Caterer: "Over the past five years we've been on an incredible journey. The whole reason why we created the brand was because IHG had a gap in the conversion sector.

"We are definitely seeing a huge demand. It gives individual, independent hotels access to a global hospitality company. We give them the support of our systems, enterprise and expertise."

Speaking at a later panel, Patrick Mendes, chief executive of Europe and North Africa at Accor, said it had become "more and more important" for travellers to have "security in a brand" that will make them feel "comfortable and safe".

Paul Callingham, chairman at Starboard Hotels, which owns and operates 21 hotel properties under brands such as IHG, Hilton and Accor across the UK, told The Caterer: "The brands are there to promote and sell the hotel; I'm there to run it. They are partnerships."

Continue reading

You need to create an account to read this article. It's free and only requires a few basic details.

Already subscribed?

The Caterer Breakfast Briefing Email

Start the working day with The Caterer’s free breakfast briefing email

Sign Up and manage your preferences below

Check mark icon
Thank you

You have successfully signed up for the Caterer Breakfast Briefing Email and will hear from us soon!

Jacobs Media Group is honoured to be the recipient of the 2020 Queen's Award for Enterprise.

The highest official awards for UK businesses since being established by royal warrant in 1965. Read more.


Ad Blocker detected

We have noticed you are using an adblocker and – although we support freedom of choice – we would like to ask you to enable ads on our site. They are an important revenue source which supports free access of our website's content, especially during the COVID-19 crisis.

trade tracker pixel tracking