• Yotel extends its brand

Yotel has moved into the extended stay segment with the launch of the YotelPad brand, with five confirmed sites in the US, Europe and Middle East.

The company’s CEO told Hotel Analyst that he did not want the group to “jinx ourselves” by setting a growth target, as it looks to stays of up to six months.

Yotel, which saw Starwood Capital invest USD250m at the end of last year, giving it a 30% stake, said that the concept had been “very well received” by its current partners.

The first YotelPad properties will be in Switzerland, Dubai, Miami and Park City. The latter location will see the first YotelPad, at Park City Mountain, the largest ski resort in the US. It will be developed by Replay Destinations.

In Switzerland, it was opening two locations in the Geneva Lake district. CEO Hubert Viriot told us: “The area, home to numerous factories and business operations, sees a significant amount of business travel, but currently offers very little by way of suitable hospitality nearby. There is also a strong expat community of those on short term assignments and companies need an affordable option to accommodate their employees.”

Standard rooms will start from 20 sqm, but larger offerings will include work and relaxing areas, en-suite bathrooms, kitchenettes and storage space. Communal areas and amenities can include 24/7 gyms, bike and gear storage, Amazon lockers, laundry, home cinema and library as well as Yotel’s Club Lounge, for co-working, meetings and entertaining friends or colleagues.

Commenting on the new flag’s ownership structure, Viriot said: “The majority of the brand’s initial developments will be branded residences, meaning the individual units will be sold to owners, either individuals, corporations, or institutional investors, and then those owners have the option to put those units back into the rental market. Upon booking these units, owners will pay a commission to YotelPad for servicing and managing their units.”

Viriot said that he expected to see “quite a lot” of crossover with existing customers, adding: “Yotelair and Yotel are set up for short stays, from seven hours on average at airports to around three days at our city hotels.

“YotelPad will cater for guests needing a longer stay – this can be the same guests that visited us in New York for two days on business or leisure, but is working on a six-month contract in Miami or going on a winter skiing holiday in Park City with the family. There are a lot of headquarters of businesses and NGOs in Geneva and we can certainly see guests staying on short-term contract work, but also using our city and airport hotels when travelling for business.”

The company plans to offer some co-branded sites. Both Yotel Miami and Yotel Dubai will also feature YotelPads.  In Miami Yotel will have 258 cabins and 208 Pads, in Dubai there will be 481 Yotel cabins and 101 Pads.  Guests staying at both Yotel and YotelPad will share the same Club Lounge, as well as facilities like gyms, bars, restaurants, terraces and pools within the same building.

Viriot said: “Yotel’s heritage is grounded in providing travellers with positive and affordable travel experiences in convenient locations. One of the most convenient being the airport itself. In addition to our industry-disrupting airport properties, we’ve strategically opened city hotels around the world as well. Our first two properties are cleverly designed for shorter stays, but we came to realise a gap in the hotel marketplace. We were also quickly encouraged by our multiple developer partners who believed we could take Yotel’s guiding design principles and apply it to condominiums. Hence, YotelPad, designed for longer stays. The residential properties were a natural next step as we continue to build our brand and answer to our guest’s needs and wants.

“As operators and disruptors of the hotel world, we understand the contemporary market. In the modern economy, an increasing number of people are working in jobs that require a substantial amount of travel. Moving frequently, many people scarcely stay in once place longer than a couple of months. And it is not just jobs, often people have sudden lifestyle changes which makes our offering ideal and very convenient.

“As a consequence, mandatory fixed-term contracts and red tape, coupled with the increasing cost of living and rent prices, are pushing people away from traditional ways of living. YotelPad offers the perfect solution to this growing global challenge, providing easily accessible and beautifully designed spaces created with the needs of the modern long-stay traveller in mind. Indeed, if there is anything to glean from the emergence of the sharing economy and non-traditional residential options, it is that travellers are increasingly willing to undertake new and novel experiences.

“Unlike Airbnb properties which can be very inconsistent – the YotelPad design, experience and service will be consistent – guests will know what to expect regardless of which Pad they visit.”

Viriot confirmed to us that IFA Hotels and Resorts was no longer a shareholder but that Talal Jassim Al-Bahar, chairman & CEO of IFA Hotels and Resorts continued as the chairman of the Yotel board. The company’s major shareholders now include the Al-Bahar Group, Starwood Capital Group, United Investment Portugal and Kuwait Real Estate Company.


HA Perspective [by Katherine Doggrell]: Last year’s investment in Yotel pulled an interested eyebrow upwards here at Hotel Analyst, the hope being that a brand which showed much early promise, before stuttering to a dated-looking halt, could be kickstarted.

And how. Not content with sticking to its knitting, it is looking to take on Airbnb, by offering the security of the brand and appeal to those adventurous travellers with which it identifies. Any traveller who has tried to use the luggage-storage robot at the New York Yotel will confirm that adventure is indeed the theme.

As well as Airbnb, it is also looking to take on the extended stay market (‘extended stay’ in Airbnb land is more commonly known as ‘moving house’). So you can now rest under the Yotel brand from a few hours to six months. All of a sudden this also ran has a brand stable – a veritable jamboree of Kit Kat Chunkies, classics and mini-bites. Whether this will translate into brand loyalty is another matter. Yotel’s success thus far has been in its locations – more partners like Replay will be required to start driving that brand momentum.


Additional comment [by Andrew Sangster]: Why would Yotel dilute its focus away from its pod-hotel concept? It is a small-scale company that is still building brand recognition in its existing segment. This move looks like it is spreading the brand thinly.

But there is also a real estate play. New backer Starwood Capital is no stranger to grabbing opportunities and Yotel could well lubricate a few trickier deals. What looks a marginal residential project could well be made significantly more profitable with a sprinkling of Yotel stardust. At least in theory.

There are a number of potential problems ahead. For one thing, Yotel founder Simon Woodroffe is already at play in the residential space with his Yo! Home. This could well lead the branding yo-yo to unravel.

The fundamentals of global real estate suggest that, if executed smartly and the challenges are overcome, there are plenty of profits to be had. As Woodroffe raves on his website, space is at a premium in most cities. Innovative solutions that squeeze the maximum price for every square metre will reward canny developers

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