THE PIPELINE : BEST WESTERN INTERNATIONAL
World of opportunities Part of that effectiveness comes from the company ’ s commitment to finding markets and sectors where international brands aren ’ t able to go if they have a lot of skin in the game , or where developers demand a more hands-off approach from their brand . The strategy remains one of staying focused on opportunities that give the company the chance to excel .
That starts at home . Post-recession America isn ’ t exactly a developer ’ s dream . It ’ s still a challenge to get financing outside of major metro areas , Williams says . However , Williams sees capital for conversions returning in “ oil-shell ” areas and parts of Florida and the Southeast , especially for Best Western and Plus . Still , those areas aren ’ t usually major enough markets for Premier in the United States , although in Canada and the Caribbean there is interest in Premier as a resort flag . Premier will be a U . S . gateway flag , with a goal of two properties in each long term , according to Williams .
Best Western Premier Miami International Airport Hotel
Unlike North America , Asia ’ s international development icon status means investment is flowing in , even beyond what de Souza calls “ hot ” cities — Bangkok , Phuket , Bali , Tokyo , Singapore , Beijing , Shanghai , Ho Chi Minh City , Manila , Taipei , Hong Kong , Taiwan and Seoul . While he acknowledges those markets are “ enjoying high ADRs and rooms remain scarce ,” the company ’ s focus is off the beaten path . “ Southeast Asia and Indochina , in particular , are the main focus ,” de Souza adds .
As in Europe , the strategy is about targeting locations where foreign flags have not yet flocked . So , while the brand is interested in China — with eight hotels expected to be added by the end of 2012 — much of its focus is on countries like Bangladesh , Cambodia , Vietnam and India where an increase in domestic travel and creating business travel hubs gives the company business and leisure markets . With its robust hotel development scene , it ’ s no surprise Best Western sees
“ WITH ONLY ONE BRAND , PROPERTIES IN THE SAME AREA COULD HAVE RATES FROM US $ 80 TO US $ 300 . Rate resistance was an obstacle for many of our owners .”
– Mark Williams , vice president , North American development , Best Western International
India as a prime target . Domestic tourism will likely be a big driver in the subcontinent going forward , giving Best Western and Plus a niche into which to expand . However , India isn ’ t just about midscale branding . Despite a slight rate decline in 2011 , the 5-star sector has increased occupancy and remains key to the strategy of any brand looking to penetrate the market fully .
That ’ s where Premier came into play , using its lower costs and infrastructure to draw owners away from hard brands . “ Many of our new owners are in the 5-star luxury hotel segment ,” de Souza says . “ There are more new players investing in the hotel business , and it seems to be likely to grow tremendously over the past few years .”
Those same factors make many Middle Eastern destinations attractive — even though Best Western can ’ t get there first . Given concerns that obvious locations like Dubai and Doha are saturated , Best Western knew it would have to rely on owners ’ knowledge to find the region ’ s next hot spots .
That search led Best Western to Erbil , Iraq , where it recently announced two hotels . “ There is a growing demand for business travel there , especially during the current development stage . Right now there are not enough hotel rooms , and the city is being developed as a tourism hub for Iraq ,” de Souza says . “ Destinations like this are where some companies are missing out on an opportunity .”
Finding those opportunities isn ’ t just about geography . The midscale price point in the Middle East has long been pointed out as a gap in the hotel market , but many of the current offerings are too narrow . Industry insiders are seeing a niche for a flag in that sector that has broad appeal to business and leisure travelers across demographics .
Locally grown brands such as Centro by Rotana have moved into the midscale boutique space , but , despite some international chains growing a limited-service presence across the region , there was still a need for a more flexible model . “ The family-style support offered by Best Western is
46 HOTELS April 2012 www . hotelsmag . com