Wyndham Hotels & Resorts is a fairly new company, but it has a complicated spin-off history from a much larger corporation. Here we explain the hospitality company's beginnings and its distinction from Wyndham Worldwide.
Wyndham Hotels & Resorts, based in Parsippany, New Jersey, is one of the largest hotel chains in the world along with competitors like Marriott International and Hilton Hotels & Resorts. As of March 2019, the franchise has approximately 9,157 hotels internationally — 812,100 rooms — primarily in the United States.
Previously the CEO of Wyndham Destinations Network, Geoffrey A. Ballotti took over as president and CEO of Wyndham Hotel Group in March 2014, replacing former CEO Eric Danziger. He leads the company with Chief Financial Officer Michele Allen and Chief Marketing Officer Lisa Borromeo Checchio.
The Wyndham Hotels & Resorts chain includes 20 brands as of 2019 — ranging from economy to upscale. The economy scale Super 8 brand is the largest within the company, accounting for over 2,000 hotels.
The company’s complex history dates not too far back into the early 1980s, starting with Wyndham Hotels.
The company was founded in 1981 by Trammell Crow, the former president of Trammell Crow Company (TCC), a real estate development, investment, and property management company. The hospitality group grew in a short amount of time compared to other hospitality giants around the world.
In 1990, the predecessor of Wyndham Hotels & Resorts, Hospitality Franchise Systems (HFS), was founded by Henry Silverman. Initially a hotel franchiser, HFS expanded to include the addition of the vacation exchange business.
HFS continued to expand in December 1997 by merging with CUC International, which expanded the company with the addition of vacation rentals and vacation ownership businesses, forming Cendant Corporations. By 2006, Wyndham Worldwide spun off from Cendant to form a hospitality company with Stephen Holmes as its CEO.
Wyndham Hotel Group, a subsidiary of Wyndham Worldwide, experienced major growth under CEO Eric Danziger, who took over in 2008. By acquiring brands, such as Microtel and Hawthorn Suites, and adding the “by Wyndham” endorsement, the corporation was strengthened to become one of the largest franchises.
Following the appointment of Ballotti, the company began to focus more on its international business, primarily in the Middle East. Wyndham also changed its loyalty program with a simpler approach, one where members can stay in any of the properties after reaching 15,000 points.
Wyndham Worldwide in February 2018 announced the sale of its European vacation rentals, which was considered to be the largest collection of holiday rentals in Europe with more than 110,000 properties spread out over 600 destinations, to the private equity Compass IV Limited for $1.3 billion.
Current Biz and Challenges
Shortly after Wyndham Hotels & Resorts separated from Wyndham Worldwide, the company completed its purchase of La Quinta Inn & Suites for $1.95 billion in January 2018, expanding the company’s midscale business by 900 hotels. Since the beginning, Ballotti had high hopes to integrate the brand but has faced a series of ups and downs.
As of February 2019, the company as a whole reportedly had a flat quarter in the U.S. By October 2019, the company experienced a 35 percent increase in the hotel’s franchising revenue, mostly due to the integration, despite La Quinta’s 4 percent decline in RevPAR (revenue per available room, a key industry measurement of performance).
Just three years after the company retooled its rewards system to be simpler and more straightforward, Wyndham decided to revert back to its three-tier loyalty program. Senior Vice President of Global Loyalty and Partnerships Eliot Hamlisch said 70 percent of members and prospective members preferred multiple tiers.
Following other major hospitality groups, like IHG and Hilton, the company started adding “by Wyndham” to all of its brands last April. With 20 hotel brands linked to the Wyndham name, this endorsement will make it easier for consumers, including loyalty members, to identify hotels connected to the hospitality group.
The hospitality company announced on Dec. 3, 2019, the stepping down of CFO David Wyshner, who is moving into a senior advisory role reporting to President and CEO Geoff Ballotti until March 2020. He was succeeded by Treasurer and Executive Vice President Michele Allen.
Ballotti outlined a plan last year for Wyndham’s growth, as well as solidifying its identity, after formally becoming an independent company. Through a new multimillion dollar marketing campaign, the group has invested in advertisements, including digital, radio, and television ads.
The hospitality company has also been working on the quality of its properties since the spin-off, focusing on selling brands, like Knights Inn, that don’t meet these new quality standards.
Ballotti has been focusing on expanding the La Quinta brand since its integration was finalized in April. The hospitality group has been working on the outer look of the hotel, including indoor and outdoor pools as well as architectural schemes to maximize hotel space.
Wyndham has recognized that the majority of travelers preferred select service lodgings, which are hotels that don’t offer extra amenities. They have been focusing on that with La Quinta.
Plans now are to continue expanding the brand in the overseas market, primarily in Southeast Asia. Currently, the company has seen its fastest growth in China, which now has 11 Wyndham brands. The group also wants to see growth in South America and Europe. In the next three years, the group has hopes of opening 2,000 hotels in the U.S., as well as in its international market.
InterContinental Hotel Groups
One of the largest hotel chains in the world, IHG has over 5,600 hotels globally, comprising 17 different brands. The company is currently focusing on buying luxury brands and expanding its technology.
After becoming the largest hotel group in the world in 2016 following its acquisition of Starwood Hotels and Resorts, Marriott is focusing on expanding its Bonvoy rewards program. The company is also using its recently announced luxury homesharing business to build up brand loyalty.
Roughly the same size as IHG, Hilton is continuing to expand it brand, opening about two hotels a day. Recently, the hospitality giant has seen an increase in its Honors program as a result of better member engagement, while also being more attentive to lower-tier members.
The largest European hotel group, Accor is continuing to expand in European and Asia-Pacific markets. Despite having fewer numbers in terms of rooms and hotels, the French hotel chain has more brands than Marriott. Following the launch of Greet and Tribe in 2019, Accor now has 39 brands, whereas Marriott has 30.
CORRECTION: An earlier version of this story incorrectly stated that Wyndham’s purchase of La Quinta Inn & Suites expanded the company’s midscale business by 9,000 hotels. The business was expanded by 900 hotels.
This story also has been updated to remove mention of an initial public offering of Wyndham Hotels. It was replaced with the addition of the history of the predecessor of what is now Wyndham Hotels & Resorts.
This story has been updated to add the stepping down of Wyndham Hotel & Resorts’ CFO David Wyshner, and the appointment of his replacement.
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Photo Credit: Wyndham Guayaquil in Ecuador. The Wyndham Hotel Group is working on expanding in its overseas market. Wyndham Hotels & Resorts