The Ascott Limited has launched Citadines Connect, a line of business hotels with selected services, in a bid to widen its short-stay offerings.
The company said it would launch the brand with two hotels, in Sydney and New York, with sites in Dublin and Silicon Valley under consideration.
The company said that the brand would include a number of tech-enabled features such as mobile keys, self check-in kiosks, smart washing machines or laundromats and Google cloud printers.
Ascott said that it was looking to rebrand its properties such as Temple Bar Hotel Dublin in Ireland and The Domain Hotel Sunnyvale in Silicon Valley, California to Citadines Connect.
Alfred Ong, Ascott’s head for global operations, said: “Citadines is Ascott’s fastest growing brand. It has a strong reputation amongst travellers who enjoy the flexibility to choose the services according to their lifestyles. Riding on the worldwide popularity of the Citadines brand which focuses on the extended-stay market, we are introducing the Citadines Connect sub-brand to capture the short-stay segment. The Citadines Connect brand, which offers contemporary and tech-enabled hotel accommodation in well-connected locations, cater to highly mobile business travellers who appreciate the convenience, fuss-free services, online connectivity, and recreational experiences.
“We see strong potential for the short-stay segment and hotel rates are rising given the rapid growth in global mobility, bleisure travel, and a flourishing gig economy. More and more skilled professionals are taking on short-term, freelancing and ad-hoc work assignments which require them to travel frequently. We will leverage Ascott’s international network and strong management capabilities to bring the Citadines Connect brand to key gateway cities such as Hong Kong, Paris, Seoul, and Tokyo as well as popular destinations in Southeast Asia where there is high demand for quality, short-term accommodation.
“By extending our range of product offerings with Citadines Connect, we can scale up our lodging business at a faster rate and further sharpen our expertise in managing hotel assets. Our business partners and guests alike can choose from a wide variety of lodging products that can best cater to their business models, travel patterns, and accommodation needs.”
Ascott was not the only serviced-apartment specialist to look at the short-stay market. In 2015 Frasers bought Hotel du Vin and Malmaison for GBP363.4m, commenting that the brands gave it a “platform to expand”.
Frasers Hospitality’s CEO, Choe Peng Sum, said: “Malmaison and Hotel du Vin provides a tried and proven DNA in the boutique lifestyle segment for us. The purchase of Malmaison and Hotel du Vin perfectly complements our brand portfolio and gives Frasers Hospitality a platform to expand into the fastest growing hospitality sector. We look forward to building on this success with future development in the UK, Europe and Asia.”
The company’s expansion was not at the speed the group had anticipated. At purchase, there were 29 hotels across the two brands and the number has since increased to 19 Hotel du Vins and 16 Malmaisons, adding two to each portfolio.
Paul Roberts stepped down as CEO of Malmaison and Hotel du Vin in 2017, with his responsibilities taken on by Guus Bakker, CEO, Europe, Middle East and Africa, Frasers Hospitality. Bakker oversaw Scott Harper and Nick Halliday, the COOs of Malmaison and Hotel du Vin, with the latter leaving in 2018 “to pursue new ventures”.
Last year Bakker said that the company planned to expand the two to a collective portfolio of 50 properties, moving into Europe, looking at Scandinavia, the Benelux countries, Germany and Switzerland, as well as Australia, China and South-east Asia.
At the company’s fourth-quarter results, Eu Chin Fen, CEO of the managers, commenting on the group’s wider holdings, said: “We will continue to proactively pursue opportunities to optimise our portfolio, which may include portfolio rebalancing. We will also continue to work closely with our operators to drive revenue growth.”
Looking at the likely future performance in the UK, the company drew attention to the 5% drop in the number of overseas visitors in the first nine months of 2018, with business visits were 4.0%, he said: “Going forward, caution remains as the impact on business investment from ongoing economic and political uncertainty relating to the outcome of the Brexit negotiations is expected to have a bearing on hotel performance. In addition, the headwinds of rising payroll costs are set to continue in 2019, following the announcement of further increases to the national minimum wage.”
HA Perspective [by Katherine Doggrell]: There is much to enjoy when you are running serviced apartments: lower running costs, properties booked for weeks, not days, self-feeding guests. But sometimes you can find yourself looking at the sprightly rates gained by hotels and be struck with a little envy. And in these days of loyalty programmes, all companies of a certain size are being encouraged to wonder whether they should have something which caters to everyone.
Citadines Connect is allowing Ascott to cater for its regular guests when they are being more irregular, but with the added bonus of taking a little nip at the sharing economy, which really never hurts if you can do it. It has features such as washing machines which you wouldn’t expect in short stay, but which acknowledge that, just because someone is only staying with you for a night or two, that doesn’t mean that they haven’t been on the road for a month. The brand also gives Ascott the chance to reflag existing sites, such as that in Dublin, to find a better fit.
If your area of expertise isn’t short-stay, beware. At Frasers, the expansion of Malmaison and Hotel du Vin has not been the rapid-fire growth that they’d hoped. The brands were heavy on service and design, have been relentlessly copied since their launch and were, we fear, very possibly hexed after any number of people have tried to grow them and found the task too taxing. Show us a feature on whether boutique brands can be expanded around the world and you will find Malmaison and Hotel du Vin getting star billing.
So if you will tread where the footfall is high, keep it simple.