Surprising eye-opener for Outbound

CHICAGO – An unexpected opportunity has emerged for Outbound Hotels, the nature-first brand with properties adjacent to outdoor destinations open in Jackson Hole, Wyoming; Mammoth Lakes, California; and Stowe, Vermont: groups now accounts for about 30% of its business. When you stop and think about bigger trends, it really shouldn’t come as a surprise and it is delighting Matthew Mering, Outbound co-founder and executive vice president of Hospitality at Waterton, the brand’s ownership group that has a newly announced minority investment partner in Lowe Enterprises’ CoralTree Hospitality.

“When we started the first Outbound in Jackson, we didn’t really think through meeting and group business much. We were focused on F&B, rooms and traditional rooms department operations,” Mering explained. “But it’s been eye opening how much group business is in these markets, and it’s been an evolution pivoting towards group business. It really helps in the shoulder season and mid-week.”

Outbound Hotels Co-founder Matt Mering

Mering said group is a nice mix of leisure and corporate business. “The nice thing about group is it obviously creates a base of demand. So, we can yield really high transient rates, which helps if you’re shrinking your box from 150 to 100 rooms.”

Five years in, Mering added that the existing assets are performing well, “Getting at least our fair share of RevPAR index.”

Two more Outbounds are opening in the first half of next year, including the only new-build, Outbound Yosemite in California, and Outbound Sedona in Arizona, with an additional project under contract.

Opening Q1 2026, Outbound Yosemite is a 17-acre retreat just 15 miles from Yosemite’s South Gate, with 104 park-model cabins, 12 lodge rooms, a pool and hot tub, and 5,000 square feet of indoor-outdoor meeting space. Outbound Sedona, debuting Q2 2026, introduces 138 rooms with Pueblo-inspired architecture, layered interiors, and Moonwater, a pool complex designed for golden-hour lounging and stargazing. Bookings open November 3 for both properties, with stays beginning April 1 at Yosemite and May 1 in Sedona.

Outbound is also getting creative with its existing assets, building 20 condo-like units at Mammoth and just starting to sell them as branded residences. In Jackson Hole, they have a half-acre parcel being developed into 32 studio-type units to potentially use for employee housing and to rent at very healthy market rates.

Mering see approximately 50 markets in the U.S. that Outbound wants to be in and would like to start franchising the concept after maybe 12 to 15 are open.

He also sees the opportunity to take the brand overseas in markets like Mexico, Costa Rica, South America and Asia. “There are national parks all over the world. There are ski towns all over the world. There are outdoor focused markets throughout the world,” Mering said. “The sky’s the limit long term for the brand and the concept.”

Rendering of an Outbound Sedona guest room

Who actually takes the concept outside the U.S. could be another story as Mering eluded that it could be “the next owner.”

That said, he said brand owner Waterton is patient. “It’s not like we need to be out in three years,” Mering continued. “We were deliberate with our capital, especially in the first few projects where we tried to curate. It takes a while to build a brand. It takes a while to execute on these specific assets. So, we didn’t want to have a gun to our head and we’re taking a long-term view of the strategy and the platform.”

CoralTree steps up

The group also has a new investment partner with CoralTree Hospitality stepping up to the plate, investing minority stakes at both the brand and asset level.

“For us, it's more about alignment of interest,” Mering said. “We’re a well-capitalized company. We’re very selective about who we bring in as partners. It’s making sure that everyone has an owner’s mindset when we’re approaching projects, developing and managing them.”

The other big investment CoralTree is making is in building out a dedicated Outbound team, focusing exclusively on the Outbound portfolio.

It’s so challenging to develop and operate in these markets. You have to have a big balance sheet. You have to know the lodging business inside and out because there’s a lot of nuances to working in these types of environments. No, I don’t think it’s getting overdone by any means at this point.

Matt Mering

Share this quote

“They have a great track record, both in the independent resort lifestyle space, but also in building brands,” Mering added. “And because they’ve been around for 50-ish years, they have a really deep bench of talent. One thing we saw immediately out of the gates when they took over some of our properties is their ability to build a seasoned team really focused on these outdoor-type markets. That’s a real challenge as these markets don’t have super deep labor pools.”

Challenges, opportunities

As with any emerging concept, there are challenges on the development side. Within the outdoor-related space, Mering pointed to entitlements that can take six to 18 months and permitting, adding that they have to manage a lot of nimbyism in these markets.

“There are strict environmental regulations and lengthy entitlement processes because of that kind of ‘nimby’ sentiment that emanates through these markets,” he said. “We typically like to steer clear of any scopes of work that will trigger lengthy design review processes with the local municipalities. That being said, if there is a scope of work that’s really vital the success of the property, we’ll take that on.”

The other big challenge Outbound has faced revolves around construction labor as most local contractors are custom home builders without deep subcontractor bases.

To get around this, Outbound has a handful of contractors across the country that parent company Waterton has been partnering with for 30 years. Outbound mobilizes them, sends them to development sites, and houses them along with subcontractors since the projects are generally conversions.

Mering added that construction costs are starting to flatten out, but they are bracing for the impact of pending tariffs.

“We haven’t seen a meaningful impact yet,” he said. “We’ve seen maybe a 5% to 10% increase in certain materials or furniture and fixtures that are coming from Asia, but nothing as catastrophic as you might see in the headlines.”

Then there is the growing competition in the space from major brands like Marriott International and Hilton.

“I think it’s great,” Mering said. “It’s a vote of confidence and validates our thesis... There’s a lot of opportunity, and at different price points. There’s plenty of room.”

Mering isn’t too worried about overbuilding either. “It’s so challenging to develop and operate in these markets. You have to have a big balance sheet,” he said. “You have to know the lodging business inside and out because there’s a lot of nuances to working in these types of environments. No, I don’t think it’s getting overdone by any means at this point.”