Wyndham Hotels & Resorts has teamed up with LuxUrban Hotels, a hotel operator in the US, to expand its Trademark Collection portfolio.
The 16 LuxUrban hotels - located across major US cities including New York, Los Angeles, Miami, Washington, and New Orleans - will retain their branding while gaining recognition via Wyndham’s Trademark brand. In exchange, Wyndham will offer financial, sales and operational support to help advance LuxUrban's asset-light acquisition-driven growth strategy.
The deal also opens the door for future collaborations with other LuxUrban properties.
The Trademark Collection by Wyndham currently includes over 185 hotels in 25 countries.
Why it matters
The incorporation of 16 LuxUrban hotels into Wyndham's Trademark Collection is indicative of a strategic move by Wyndham to further increase its presence in the United States' urban markets as groundup development remains challenging, with Wyndham's portfolio set to significantly benefit from the tourist-rich areas in which the hotels are located. The deal also showcases a broader trend in the hospitality industry – the merging of the benefits of large-scale, established brands with the appeal of smaller, boutique operators, demonstrating the importance of balancing the charm and individuality of smaller brands with the resources and reach of a global brand, especially in highly-competitive urban hotel markets.
We've seen several hotel companies look to grow their presence in the lifestyle and luxury space, for example Accor recently reaffirming its confidence in the segment and saying net unit growth during the next year will be primarily driven by its Luxury & Lifestyle division as well as Wyndham's acquisition of the Vienna House brand. These moves, and many others, further indicate that leisure travel demand is currently leading the way in driving hotel performance. Therefore, a lot of owners are looking at brands like LuxUrban as they carry out asset management and repositioning strategies in order to capture future growth in leisure travel demand.
It's important to note that luxury and lifestyle is running the risk of becoming an oversaturated space. However, what Wyndham is doing is incorporating and plugging in an already-existing brand into its system instead of creating yet another luxury & lifestyle brand.
What they said
Chip Ohlsson, chief development officer at Wyndham Hotels & Resorts said: "We created Trademark Collection by Wyndham specifically to cater to the needs of operators like LuxUrban. In just a few years, LuxUrban has created a significant position in the US urban hotel market, proving the success of its unique, asset light operating model. We're excited to have their hotels join what continues to be one of Wyndham's fastest growing brands and even more excited by the long-term growth opportunities that exist for both LuxUrban and for Trademark.”