For hotelier Sant Chatwal, the decision to align one of his boutique hotels with lodgings giant Starwood Hotels & Resorts was not an easy one. The hotel in question, the luxury Chatwal New York, is an Art Deco theater district landmark with suede-covered walls and heated terraces. But would becoming a link in a chain dilute the Chatwal's carefully crafted personality" In the end, Chatwal decided his hotel's quirky qualities were safe and would benefit from access to Starwood's reservations platform and marketing prowess.
The Chatwal became the first New York City property in Starwood's Luxury Collection last week. "There are very few brands on the planet that allow you to retain your own identity," Chatwal's spokesman, Brendan McNamara, said of Luxury Collection, which has assembled more than 75 independently owned properties under one label. Yet since the 2007-2009 recession, such brands have proliferated, and independent hotels are more open to joining a larger entity in order to gain access to more potential customers. "Independents got hit harder," said Jan Freitag, a vice president of Smith Travel Research, whose findings show that of over 21,000 non-branded hotels in the United States, only about 400 could fit the image Luxury Collection or Autograph are trying to project. "A larger program can buffer you from a downturn, or a sluggish recovery."
Starwood, which plans to add 10 properties to the Luxury Collection by mid-2014, saw an increase in interest from potential members during the downturn, spokeswoman Gigi Ganatra Duff said. Marriott International started a similar brand, called Autograph, in 2010, while Choice Hotels International Inc launched Ascend, in 2008. "When everything slows, you can see the penetration of the larger brands," McNamara said. As a Luxury Collection member, the Chatwal will enjoy more aesthetic freedom than franchisees of, say, St. Regis, a Starwood luxury brand whose look and service style is consistent across properties. But the Luxury Collection and similar brands do charge fees and require compliance with specific standards, which may deter potential affiliates.
The Hotel Teatro in Denver, Colorado, opted not to join Autograph because Teatro felt the mandated revisions of its marketing materials would undermine its credibility as an independent. It also was not willing to pay $300,000 in fees in the first year alone, said spokeswoman Kelly Cox. Those fees are part of why Starwood and Marriott are in the independent business, said Robert Mandelbaum, a director at PKF, the hospitality consultancy. Starwood and its peers try to avoid the risk of owning real estate and instead make money by franchising brands and managing properties. They must take care not to cannibalize a market with their own competing products, and adopting an independent solves that problem. The big chains also appreciate a little indie cred, Mandelbaum said. Boutique hotels cast a halo of hipness back on the parent company.
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