Alternative, experiential sectors winging it… for now

LOS ANGELES - In a breakout session at ALIS devoted to Alternative and Experiential Lodging, panelists shared tremendous enthusiasm for this rapidly growing lodging segment, even if the path to scale and profitability isn’t quite crystal clear.

Todd Wynne-Parry, managing director at Horwath HTL and the former chief growth officer of Autocamp, an airstream lodging company, compared the excitement for this growing hospitality sector to the boutique and lifestyle hotel revolution. “I feel it has a lot of similarities to sort of 25 years ago when lifestyle, boutique and independent lodgings was on its startup, with a lot of new entrants,” he said.

Wynne-Parry was joined on the panel by Anjali Agarwal, senior vice president, Starwood Capital Group; Rick Cunningham, senior vice president, Development, Margaritaville; and Ben Tschann, partner, Goodwin Procter LLP. The panel was moderated by Rachael Rothman, head of Hotels Research & Data Analytics, CBRE.

Camp Margaritaville RV Resort and Cabana Cabins in Auburndale, Florida

Wynne-Parry broke down the alternative and experiential lodging landscape (sometimes called outdoor hospitality) to include RV parks, glamping units, tented camps that are part of a larger luxury branded resort, and what he calls independent lifestyle operators, people with extra land who rent out tents, cabins or vintage trailers on various OTAs, including Airbnb. Yet he noted that it’s still a very small group with not a lot of big players emerging.

Leading the field

What is clear, though, is that the demand for these types of outdoor lodgings is continuing to grow.

Agarwal, who served as the chief operating officer at Autocamp during its expansion, said that when the brand was conceptualized eight years ago, its founders did a deep dive into national park visitation statistics and noted that visits increased by 40% after the Great Recession. From 2015-2018, new camper households at national parks averaged about 2 million a year. But once the pandemic happened, that number surged to more than 10 million in 2020. Since then, the number has dropped a little bit, with 2023 seeing 6.5 million camper households.

“It is taking a share from traditional lodging because of the customers,” she said, adding they are hungry for new experiences, particularly those in their 30s and 40s with young families. And because the pandemic made remote working acceptable, customers can get away while still having an adventure.

“At Autocamp, post-pandemic, we would see several people working from their laptops being outdoors,” Agarwal said.

Starwood Capital is creating its new brand, Field & Stream Lodging Co., the first of which will open this year. The brand’s intent is to provide modern and affordable lifestyle lodging near national parks, mountains, beaches and ski towns.

Autocamp site

Camp Margaritaville, the RV park division under the Margaritaville lifestyle brand, has gone a different route than Autocamp to alternative lodging, by rebranding existing RV parks into “license to chill” Camp Margaritaville experiences.

“What we've done in Camp Margaritaville is take the lifestyle company that we already are and integrate it into a RV concept, as well as the camping trip” Cunningham said. “Becoming a destination for the day, incorporating all of our digital products into that camp.” Currently, there are six Camp Margaritavilles and more to come.

Creating scale

For now, Margaritaville is the only major brand that seems to be capitalizing on alternative and experiential lodging, aside from luxury brands like Four Seasons, Aman and Ritz-Carlton who are tacking on luxury safari tents to their resort experiences.

Yet Tschann of Goodwin said while brands haven’t entered the space, sophisticated capital is moving in. Investors are looking at where customers are spending their money and seeing that less discretionary dollars are going towards consumer products but more towards consumer experiences. “And so that's why this segment is so ripe,” he said. “And it has, I think, a long runway ahead of it, given that it is fragmented. It's still early days.”

The problem with this particular sector is that every site is completely different. It's all different jurisdictions. It's all different sizes of sites and geography.

Todd Wynne-Parry

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Aside from a fragmented owner and operator landscape, the sector has some challenges when it comes to scale and growth. It’s not like rolling out 120 Courtyard by Marriott hotels in eight years, Wynne-Parry said.

“The problem with this particular sector is that every site is completely different. It's all different jurisdictions. It's all different sizes of sites and geography,” he said. “Normally, scaling in the hotel industry goes quite fast. Once you figure out the product and then design, you get other people building it for you and you franchise. But in this sector at this point in time, it's not happening very fast.”

Margaritaville, however, might be well-positioned to scale its outdoor lodgings faster than most, especially as it can tap into all different age groups from young to old.

“We're putting it all under our umbrella and really focusing on the experience, but also the destination,” Cunningham said. “We don't want them to necessarily leave Camp Margaritaville, because we want to provide enough activity for them to stay there and enjoy it.”

Consolidation of existing campsites, as well as converting older motels or campgrounds could be an easier way for smaller companies to continue to grow their foothold in the outdoor lodging space without having to start from scratch.

In the meantime, outdoor lodging is experimenting with other avenues of revenues to increase profitability—by borrowing a page from a traditional hotel's playbook.

Because Autocamp can’t necessarily charge high rates without higher levels of service and amenities, Agarwal said the company has focused on retail, food and beverage, and selling guided experiences like hikes in partnership with outdoor outfitters REI. “We added a lot of revenue streams while keeping the core base model of efficiency." she explained. "And so that was a way to maximize profitability.”