Crowne Plaza Is Hotel Growth Leader

In the past few years, Crowne Plaza has quietly emerged as the brand to watch in the upscale segment. The IHG flag has a robust development pipeline, it’s in the midst of a massive chainwide upgrading program, and it tops the list of Lodging Hospitality’s 10 Growth Chains for 2009.

Between the last quarter of 2007 and the end of 2008, the brand added 45 properties—most through conversions—and 9,987 rooms. That’s a 25.27-percent growth pace for the year.  That percentage was matched by Crowne Plaza’s sister brand, Candlewood Suites, which expanded by 46 properties and 4,039 guest units, also a 25.27-percent growth clip.

Crowne Plaza has grown quickly in recent years: up from 76 properties in the Americas five years ago to 193 today. Worldwide, the 26-year-old brand has 349 hotels with 96,188 rooms in about 50 countries. An additional 126 properties, including 39 in the Americas, are in the development pipeline.

FUELING EXPANSION
Fueling the growth, says Americas brand chief Gina LaBarre, is a combination of the chain’s refurbishing program, its mix of targeted amenities and services and its emphasis on what she calls “value over excess.

“We’ve seen a period of incredible growth over the past few years, mostly with conversion properties,” says LaBarre. “To become even stronger players in the market, we’ve elevating the brand a step further through a resurgence of major property renovations.”

So far, owners of Crowne Plaza in the Americas have spent more than $250 million renovating their properties. About 40 hotels have completed the process and 50 more are in the middle of upgrading. By the end of the year, about half of the system will be completely renovated.

One of the biggest refresh projects was the recently completed $85-milion renovation of the Crowne Plaza in New York City’s Times Square. Since the project was completed, the hotel has been able to achieve double-digit RevPAR Index gains every month in 2009.

In 2002, the brand launched its “The Place to Meet” campaign, a marketing and operational initiative that positions it as the hotel of choice for small to mid-sized business meetings. Complementing the campaign is Crowne Plaza’s sponsorship of professional golf. In 2007, the chain signed a six-year agreement to be title sponsor of a PGA Tour event in Texas.
Candlewood Suites is also on a development fast track. Since buying the brand in 2003, IHG has been able to grow the system to 213 properties (all but one in the U.S.) and 21,499 rooms. If all the properties (228) in the Candlewood pipeline are built, the brand could double in size in a few years.

A YEAR OF GROWTH
It may seem a bit counterintuitive, given the economic downturn and freeze in the credit markets, but 2008 was an exceptionally strong growth year for U.S. hotel chains. The 10 fastest-growing brands in the industry added a combined 79,966 rooms to their systems, according to LH’s annual analysis of the industry. In 2007, the 10 growth chains added a combined 41,706 rooms. Three years ago, the figure was 61,942 rooms.

The chains making up the growth list haven’t changed much from year to year. Seven of the brands on the list also appeared on the 2008 roster. New to the list are Comfort Suites, Baymont Inn & Suites and Holiday Inn. Missing from last year are Westin, Hyatt and Omni.

Lodging Hospitality editors calculate the 10 Growth Chains by comparing the yearly gains in the number of U.S. hotel rooms for the top 50 hotel chains. Each brand’s numbers appear in The Brand Report in the March 1 issue and are based on numbers supplied to Lodging Hospitality by the brand companies.

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