Accor's aggressive push into the high-end luxury and lifestyle hotel segments with brands like Delano and Raffles position the company well — if analyst predictions of an early luxury demand recovery actually materialize.
Accor’s continued expansion of its Delano hotel brand now includes plans for an urban-focused sub-brand in Paris, yet another signal the French company sees plenty of future travel demand in the so-called lifestyle hotel sector coming out of the pandemic.
Katara Hospitality, the hotel development arm of the Qatar sovereign wealth fund, partnered with Accor on a hotel refurbishment project in the 8th Arrondissement of Paris that will result in a Maison Delano property slated to open in 2022, the companies announced Tuesday.
Maison Delano will be Accor’s line of urban hotels for the brand while resorts in beach, mountain, or countryside destinations will take the simplified Delano name.
The planned hotel is the latest in an ongoing expansion of both the Delano brand — which originated in Miami and has a second location in Las Vegas — as well as Accor’s continued push into the lifestyle hotel sector, a fast-growing part of the industry that focuses more on bars and restaurants and personalized experiences.
Accor CEO Sebastien Bazin identified both ultra-luxury and lifestyle hotels as “high potential segments” when the company underwent a major restructuring last year.
All the major hotel companies, from Marriott to Hyatt, have some level of lifestyle hotel concept in their brand portfolios. But Accor is the only one to create a standalone entity for these brands, spinning out Delano and its other lifestyle brands like Mondrian and SLS into a separate division last year with Ennismore, owner of the Hoxton and Gleneagles hotel brands.
“These hotels are not about the rooms. We would do well selling rooms in that location in Paris regardless of the brand,” said Gaurav Bhushan, CEO of Accor’s lifestyle brands, of the planned Maison Delano. “What brings the brand to life is the food and beverage, the entertainment … the style of delivery.”
Hotel companies vary on what constitutes a lifestyle hotel, but Accor and Ennismore generally view them as ones that make as much as half their revenue from food and beverage outlets.
“Big, luxury hotels can sometimes become intimidating,” Bhushan said. “Locals are sometimes too shy to go inside these hotels because they feel like they don’t belong there. That’s exactly what we want to get away from.”
Katara Hospitality and Accor — which are also partners at the Raffles hotels in Singapore and Paris as well as the Plaza in New York City — will spend a little over a year renovating the 56-room Maison Delano, which is currently the Buddha-Bar Hotel. Plans include building out the property’s restaurant and bar concepts around a central courtyard.
Developers may pursue lifestyle hotels partially to appeal to local clientele, but Accor’s continued growth in this sector also hints the company anticipates pent-up demand for luxurious hotels during the pandemic recovery. The Maison Delano development plan takes into consideration American travelers because they are “a big, big market” for high-end hotels in Paris,” Bhushan said.
“The Delano brand is well-known in America. Bringing that high-end, luxury, lifestyle customer to our hotels and to this hotel in Paris works well for us strategically as well,” he added. “When our American guests come to Paris, I think this is exactly what they want to see. They want to see a beautiful, old Parisian building but in the context of a 21st century urban-chic, high-experience environment.”
Accor’s lifestyle hotel push is about more than the Maison Delano in Paris. While drive-to and leisure travel continues to lead the industry recovery, luxury hotels could begin to see more business as guests decide to spend more on trips, according to a Bernstein report last month.
The pandemic has been financially devastating for so many people around the world. But there are also many potential guests who have been saving more money than ever over the last year while they continued working but largely stayed home.
That presents an opportunity for hotel companies, and many figure those pent-up travelers are going to crave the more tailored experience a luxurious lifestyle hotel can provide once the pandemic is over.
“Even with [the Delano in] Miami, it was never all about being the noisiest hotel. It was about being a real experience – very lifestyle but also high-end luxury,” Bhushan said. “It’s not about having the loudest parties.”
Photo credit: Accor's continued expansion in the luxury and lifestyle hotel segments (pictured: the future Maison Delano in Paris) indicates the company sees growing demand for high-end properties in the future. Accor