Applause is due to Wyndham. The world's largest hotel franchisor is finding practical ways to reduce the friction that discourages many Black entrepreneurs from becoming hoteliers.
The U.S. hotel investment sector is insular. For many Black entrepreneurs, having the right connections and upfront capital are roadblocks to joining the club. So Wyndham Hotel & Resorts has revealed an effort to open the door wider to potential dealmakers, franchisees, and developers who are Black.
Wyndham, the world’s largest hotel franchisor, calls its program Bold [Black Owners and Lodging Developers]. It formally announced the effort at Wednesday’s opening of an annual conference of The National Association of Black Hotel Owners, Operators and Developers (NABHOOD).
Wyndham’s program mixes outreach and educational efforts with offering capital and operational support. It also includes a team that claims to uncover financing opportunities and makes introductions to lenders, said Galen Barrett, vice president of strategic development.
Earlier this year Wyndham began a similar program for women. There are already more than a dozen poperties under development with women owners.
“With today’s debut of BOLD by Wyndham, we’re looking to further leverage the power of Wyndham and create even more development opportunities for underrepresented ownership groups,” said CEO Geoff Ballotti.
Fewer than two out of every 100 U.S. hotel owners are Black, according to a NABHOOD survey. That statistic contrasts with a McKinsey survey that found that about one in five Black Americans is starting or currently running businesses.
“Hotel ownership is capital intensive,” said Andy Ingraham, president and CEO of the association. “Any steps to reduce the need for having all of the capital upfront — whether it’s reducing ramp-up costs, franchise fees, loan costs, or other changes to the capital stack — will help boost participation by Black entrepreneurs.”
“This program will address several issues like that on a case-by-case basis, rather than a cookie-cutter approach,” Ingraham said.
Helping a First-Time Black Hotelier
One of the first program members in a soft launch is Vaughn Irons, who is becoming a first-time hotel owner. Irons was recently awarded new construction on a 110-room TRYP by Wyndham franchise in the Atlanta suburb of Stonecrest, Ga, as part of an enormous Priví Stonecrest mixed-use complex. The groundbreaking for the hotel is set for early next year.
“Throughout each and every interaction, Wyndham has been a true partner,” said Irons.
While the hotel industry has done educational outreach to the Black community, Wyndham’s program claims to go further.
The Bold program will offer selected, qualified participants “access to enhanced capital and operational support,” introductions to lenders and brokers, mentorship, discounts with preferred suppliers, and “the opportunity to explore partner/joint venture opportunities and package development deals that come with additional capital support.”
Black executives make up about 1.5 percent of hotel directors and executives, according to a pre-pandemic report by The Castell Project.
“Wyndham is the first major hotel group to change the paradigm,” Ingraham of NABHOOD said.
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Tags: black lives matter, black travel, black travel movement, diversity and inclusion, future of lodging, hotel deals, hotel development, hotel investments, wyndham, wyndham hotel group
Photo credit: Black businessman standing at balcony and using smartphone in luxurious hotel lobby. Source: Adobe.