With acquisitions like WoodSpring Suites, Choice Hotels' new CEO is making good on his mission to continue to grow the company and establish its dominance in the economy and midscale sectors.
For the first quarter, Choice Hotels’ net income increased 3 percent from the same period last year to $25.1 million. Adjusted net income grew 25 percent to $38.4 million from the first quarter of 2017.
The company’s domestic revenue per available room (RevPAR) grew 3.5 percent, in line with the overall industry which also saw a 3.5 percent increase in domestic RevPAR. WoodSpring Suites, in particular, saw its RevPAR grow by 13.5 percent.
Enthusiasm for WoodSpring
The extended stay accommodations sector remains one of the fastest growing and best performing sectors of hospitality, especially within the United States, and WoodSpring’s success in the first quarter demonstrated that.
In the first quarter of 2018, STR reported a RevPAR increase of 4.9 percent for domestic extended stay hotels, and WoodSpring, by comparison, had RevPAR gains of 13.5 percent.
Choice Hotels CEO Patrick Pacious also noted that WoodSpring set a development record in the first quarter for the brand, adding 33 new franchise agreements — 31 of which were signed after WoodSpring was formally acquired by Choice. The company plans to open a total of 17 WoodSpring Suites in 2018.
“… On the development front, the enthusiasm around this brand, particularly post acquisition is increasing,” Pacious also noted, especially among existing Choice Hotels owners who are considering opening new WoodSpring Suites hotels.
Focusing on Comfort
In addition to focusing on growing the WoodSpring Suites brand, Pacious also said Choice Hotels is focusing on its midscale Comfort brand.
By 2019, Choice will have invested some $2.5 billion into transforming 1,600 of its Comfort-branded properties with updated lobbies and guest rooms, and last week, the company also debuted a new brand logo to be used across the Comfort Inn, Comfort Inn and Suites, and Comfort Suites brands. The company expects all locations to have the new logo and signage by the end of 2020.
Uptick in Loyalty Membership, Direct Bookings
Pacious said the company saw the addition of 1.3 million new Choice Privileges loyalty members in the first quarter, giving the program a total membership of 36 million.
He also said the company saw an increase in the number of direct bookings, especially via the company’s mobile app, which saw a 60 percent jump in visits and revenue growth of 45 percent compared to the first quarter of 2017.
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Photo credit: A room prototype for WoodSpring Suites. Choice Hotels closed its $231 million purchase of WoodSpring Suites in February. WoodSpring Suites / WoodSpring Suites