HOTEL FRANCHISES COMPLETE GUIDE TO TIPS TRUE COST YOUR BIG FOR HOTELS ASSESSING THE OF FRANCHISING HOW BRAND USA PAYS OFF

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1 T H E O FF I C I A L M AG A Z I N E O F T H E A M E R I CA N H OT E L + LO D G I N G AS S O C I AT I O N COMPLETE GUIDE TO HOTEL FRANCHISES OWNERS LIKE HER SHARE SMART STRATEGIES AUGUST TIPS TO REHAB YOUR PROPERTY ASSESSING THE TRUE COST OF FRANCHISING HOW BRAND USA PAYS OFF BIG FOR HOTELS MARIAN GOODMAN CEO, SKY HOSPITALITY LO D G I N G M AG A Z I N LO D G I N G M AG A Z I N E

2 CONTENTS AUGUST 2014 VOLUME 39 ISSUE NO FRANCHISEE FOCUS Before becoming CEO of Sky Hospitality, Marian Goodman went to school for civil engineering and worked for a big bank during the heyday of S&Ls. She opened her first Microtel in Leesburg, Fla., in FEATURES 43 Hotel Franchise Guide From franchise fees and cost per key to target customers and competitive set, here s everything you need to know before investing in a hotel. This comprehensive guide features 21 companies and more than 80 brands. Also inside Q&As with Best Western, Carlson Rezidor, Choice, Hilton, IHG, La Quinta, Magnuson, Marriott, Starwood, and Wyndham. BY BRUCE SERLEN AND THE LODGING STAFF 44 AMERICINN BOOMERANG HOTELS 45 BEST WESTERN 46 CARLSON REZIDOR 48 CHOICE HOTELS 50 G6 HOSPITALITY COBBLESTONE HOTELS 51 HOSPITALITY 52 HILTON WORLDWIDE 54 HYATT HOTELS & RESORTS 55 LA QUINTA HOLDINGS 56 INTERCONTINENTAL HOTELS GROUP 58 MAGNUSON WORLDWIDE 59 RED LION HOTELS CORP. RED ROOF VALUE PLACE 60 MARRIOTT 62 STARWOOD HOTELS & RESORTS WORLDWIDE 64 WYNDHAM HOTEL GROUP 66 VANTAGE HOSPITALITY 67 AMERICA S BEST FRANCHISING 4 LODGINGMAGAZINE.COM AUGUST 2014

3 FROM THE EDITOR PUBLISHER William E. Corsini ASSOCIATE PUBLISHER Jeffrey Cohen EDITOR-IN-CHIEF Sean Downey Making a Connection WE CREATED THIS FRANCHISE GUIDE TO HELP hoteliers, developers, and investors gain some insight into each hotel brand. Along with collecting crucial information like cost per key and target customers from the hotel brands, we also talked to several franchisees about their anecdotal experience owning a franchise. Now in its second year, our guide is doubling down on this personal approach by adding interviews with franchisors that delve into the latest brand happenings. These Q&As go beyond room counts and development costs to mine the direct connections that lie at the heart of the franchise partnership. Because, according to Marian Goodman, CEO of Sky Hospitality and this month s cover subject, people like doing business with folks they know and trust. When you re considering a franchise, look for someone who you genuinely feel like is going to be a partner with you, Goodman says. You want a franchise that will join hands and support you, knowing that you both have a common objective in seeing your hotel be successful. She adds that it isn t just about getting a property developed and opened, but it s also having a partner to stand with you through the life cycle of the hotel. Goodman, a Florida-based owner and operator, got into the management side of things after some of her local business contacts approached her. They owned land at an interchange of I-75 and came to us and said, We have this piece of ground that we think a hotel would do well on, but we don t know anything about running one, she says. We just aren t going to do it unless you run it for us. That was our first management contract. Like so many hoteliers, Goodman likes the way the lodging industry revolves around personal connections. At the end of the day, if you don t have the right partner, it doesn t matter what the deal looks like on paper, it matters in the delivery, she says. Whatever route you take to get into the business of running a hotel, hopefully this guide will give you the information you need to choose the brand that fits you and your needs best for now and for years to come. CREATIVE DIRECTOR Shane Hickey MANAGING EDITOR Mike Bederka PRODUCTION MANAGER John Mass SENIOR GRAPHIC DESIGNER Bill Hamilton CONTRIBUTORS Kristin Boyd, Marla Cimini, Craig Kalkut, Robert Mandelbaum, Gary McDade, Valerie Neff Newitt, Bruce Serlen, Rob Ulrich LODGINGMAGAZINE.COM EDITOR: Megan Sullivan CONTRIBUTORS: Harvey Chipkin, Bruce Serlen, Anthony Stoeckert, Rob Ulrich SALES SOUTHEAST/MIDWEST: Jeffrey Cohen , fax jcohen@lodgingmagazine.com NORTHEAST: Bill Corsini , ext. 41, fax bcorsini@lodgingmagazine.com WEST: Solomon Ortasse , fax sortasse@lodgingmagazine.com CLASSIFIED/MARKETPLACE: Don Serfass , ext. 30, fax dserfass@mcneill-group.com MCNEILL MEDIA GROUP INC. PRESIDENT: Edward J. McNeill Jr. CHIEF OPERATING OFFICER: Donald Foy CONTROLLER: Lou Taicher EDITORIAL DIRECTOR: Jessica Downey AMERICAN HOTEL & LODGING ASSOCIATION CHAIR: John Fitzpatrick VICE CHAIR: Jim Abrahamson TREASURER/SECRETARY: Mark Carrier PRESIDENT/CEO: Katherine Lugar EXECUTIVE VICE PRESIDENT/COO: Pam Inman EXECUTIVE VICE PRESIDENT/CFO: Joori Jeon SENIOR VICE PRESIDENTS: Brad Aldrich, Rosanna Maietta, Kimberly Miles, Kathryn Potter, and Vanessa Sinders FOUNDING EDITORS: James A. Pearson and Frances L. Pearson Published by McNeill Group, Inc., Yardley, PA. Nothing contained in this publication shall constitute an endorsement by the American Hotel & Lodging Association, nor McNeill Group. AH&LA disclaims any liability with respect to the use or reliance on any such information. The information contained in this publication is in no way to be construed as a recommendation by AH&LA of any industry standard, or as a recommendation of any kind to be adopted or binding upon any member of the hospitality industry. 8 LODGINGMAGAZINE.COM AUGUST 2014

4 Marian Goodman, CEO, Sky Hospitality WHY DO SO MANY FRANCHISEES CHOOSE THE WORLD S LARGEST HOTEL FAMILY? I believe that working with the Wyndham Hotel Group offers owners more bang for the buck. As a developer and manager, I need partners that I can connect with on every level; from real estate to construction and employee training to loyalty rewards. This is a company that is able to give you everything. Even though they are one of the largest hotel groups in the world, my day-to-day interactions with them are more like those you d expect from a small company. The hospitality industry is all about creating great relationships, and the Wyndham Hotel Group does just that. For further information call (888) or visit us at The world s largest hotel family claim is based on number of properties. Offering by prospectus only. Wyndham Hotel Group, LLC., 22 Sylvan Way, Parsippany, NJ All hotels are independently owned and operated excluding certain Wyndham, Hawthorn Suites and international Ramada hotels which may be owned or managed by an affiliate or through a joint venture partner Wyndham Hotel Group, LLC. All rights reserved.

5 FRANCHISE GUIDE WYNDHAM HOTEL GROUP With 7,500 hotels worldwide, the Wyndham Hotel Group is one of the world s leading hotel franchisors. Operational support includes 24/7 access to MyPortal, a single point of information for franchisees on a range of operational issues from purchasing materials to managing social media. Part of Wyndham Worldwide and based in Parsippany, N.J., the Wyndham Hotel Group s portfolio includes 12 brands, down two from last year Dream and Night having fallen from the roster. Iconic brands such as Days Inn and Super 8 have been franchise staples since 1976 and 1972, respectively. Super 8 has 1,718 properties open, representing 104,000 rooms, while Days Inn has 1,580 properties in operation, representing 121,500 rooms. FRANCHISEE FOCUS With a background she describes as varied, MARIAN GOODMAN brings a wealth of experience to Sky Hospitality, the ownership and management company she runs. Goodman went to school for civil engineering and worked for a big bank during the heyday of S&Ls. At that time, you had to go present your applications to the federal home loan bank board and defend them in terms of why you needed a bank there, she says. It s the same sort of stuff you do when looking at a new market for a hotel. In the wake of the S&L crisis, she left banking to become the general manager of a 130-room, full-service Ramada Inn, an experience she describes as wonderful. SNAP SHOT Cost per key DAYS INN: $52,934 $82,095 (new) and $1,989 $23,905 (conv.); KNIGHTS INN: $46,878 $71,774 (new) and $1,240 $16,460 (conv.); MICROTEL: $45,336 $67,189; SUPER 8: $47,526 $66,043 (new) and $2,936 $26,517 (conv.); TRAVELODGE: $44,898 $71,229 (new) and $1,977 $19,379 (conv.); BAYMONT INNS AND SUITES: $60,700 $82,109 (new) and $1,920 $29,640 (conv.); HAWTHORNE SUITES: $110,813 $166,866 (new) and $2,204 $57,619 (conv.); HOWARD JOHNSON: $47,180 $82,020 (new) and $1,847 $24,689 (conv.); WINGATE: $68,572 $102,705; RAMADA: $55,542 $77,035 (new), $72,571 $84,562 (new Ramada Plaza), $2,207 $38,255 (conv.), $1,822 $42,329 (Ramada Plaza conv.); TRYP: $86,659 $143,423 (new) and $8,464 $78,329 (conv.); WYND- HAM: $131,104 $211,084 (new), $94,233 $148,358 (Wyndham Garden new), $3,608 $94,142 (conv.), $4,480 $77,555 (Wyndham Garden conv.) Total number of U.S. properties 5,592 Rewards program Wyndham Rewards Length of contract 20 years (15 for Baymont Inn and Suites, Days Inn, Howard Johnson, Ramada, Travelodge, and Wyndham Hotels and Resorts conv.; 3 years for Knights Inn) Contact Gus Stamoutsos, hotelfranchise@wyn.com WHAT S SO WONDERFUL ABOUT RUNNING A HOTEL FRANCHISE? I love managing people and helping them grow. I love service and knowing that people leave our hotels and write wonderful things on TripAdvisor. I also really love the development process and working with a brand. A franchise brings recognition and awareness, which is worth a lot, but the real worth to me comes from the tools that a brand offers. These can vary from advertising to training to operational support. What s especially invaluable is the customer care information, which helps us identify when we aren t doing something right so we can improve it. And loyalty programs are a big driver of business as long as you train your employees to make guests aware of them. HOW DID YOU GET STARTED WITH MICROTEL? We got into Microtel because of Mike Leven, whom I had known and worked with while he was with IHG. He had left that company to grow this regional brand of 14 hotels into a national chain [Wyndham purchased Microtel in 2008]. My partner and I bought license number 30 and opened our first Microtel in Leesburg, Fla., in We ve since sold that one, but we still own and operate our second Microtel, which is located near Tampa. WHAT DO YOU LIKE ABOUT MICROTEL? This brand has been through a lot, and it continues to collect awards and make money. The intent to return has always been huge; we re talking 98 percent. Getting guests in the door has been a challenge because the brand doesn t have the awareness of bigger brands, but tagging it Microtel Inn and Suites by Wyndham has certainly given us a boost. THE DAYS INNS IN YOUR MANAGEMENT PORTFOLIO ARE ALL THE NEW PROTOTYPE. WHAT DO YOU THINK OF IT? It s a wonderful prototype, and each property is running great metrics in terms of the cost per occupied room. Operationally, they re efficient, and guests love the bold colors. They re also economical to build and don t take a lot of ground. 64 LODGINGMAGAZINE.COM AUGUST 2014