How Wyndham is pushing premium economy internationally

LAS VEGAS — Wyndham Hotels & Resorts has been making news recently with high-profile deals for its economy brands internationally, notably with a recent deal to develop 100 of its Super 8 brand in Saudi Arabia in the next 10 years and a deal last October to open 40 Microtel hotels in India in the coming years.

That’s the reverse of the trend happening in the U.S., where Wyndham has a substantial foothold in the economy space and has been creating or acquiring brands to move into higher segments.

Dimitris Manikis, president of EMEA (Europe, the Middle East, Eurasia — which includes India, Bhutan, Nepal, Sri Lank and the Maldives — and Africa) for Wyndham Hotels & Resorts, said the company has been successful, especially in his region, in getting into what the company calls the “premium economy” space.

Manikis spoke to Hotel Investment Today as part of Wyndham’s 2025 Global Conference last week in Vegas. He was joined by two other regional presidents: Joon Aun Oi, president of APAC and Gustovo Viescas, president of LATAMC.

Manikis said economy brands are perceived differently worldwide, especially in the last five years.

What we see with Super 8s and the Days Inns and the premium economy brands is that the same guy who will stay in a Raffles a week later can stay in a Days Inn or a Super 8.

Dimitris Manikis

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“After COVID, I’ve seen a great shift in travel patterns. In the past, we used to put travelers into boxes and segments and say… they travel this way, so that’s how we sell to them,” he said. “What we see with Super 8s and the Days Inns and the premium economy brands is that the same guy who will stay in a Raffles a week later can stay in a Days Inn or a Super 8.”

Ownership changes are facilitating these changes, Manikis said, especially in Europe, where individual owners are becoming rarer and institutional owners like BlackRock, Blackstone, TPG Angelo Gordon or other private equity firms, hedge funds or big insurance companies are embracing economy as an up and coming space to invest into. 

“For them, it’s EBITDA-driven and segment-driven. It’s not like it is here in the United States,” he said. “They are the new owners of hospitality. You have to address them in a different way. You have to speak to them in a different language.

“They’ve started to see that economy, and premium economy, now is actually the next big thing, but they do it in a different way.”

Manikis said that having strict brand standards that work in the U.S. often doesn’t work internationally, and you have to adapt to local needs.

“If we were so strict [and say] these are the brand standards and this is what you build, we wouldn’t have an audience to listen to,” he said. “Because we are so flexible and because we are so open to listening to what the market needs, that’s why you see all this growth now in premium economy.”  

Manikis said the plan for Super 8s in Saudi Arabia is simple: pre-fabricated hotels that can be built in six months, have a lean labor model and are operationally easy to manage and maintain.

“So, the guys that we’re doing business with in Saudi Arabia… they will build them in factories,” he said. “You only need the base. They will build it modularly and will be put [together] in six months. In six months, you will have a 50- to 60-room hotel on the outskirts of Riyadh or Dammam or wherever. That is the beauty of the model there.”

Manikis emphasized that speed is the most important element for Saudi Arabian investors.

“We’re building smart, clever, cost-efficient and fast,” he said. “With the way the market is growing… You have to be fast. They need thousands and thousands of rooms in that premium economy space and that’s exactly where we come in. They are completely saturated in luxury. Every single luxury brand is in Saudi Arabia. We saw a niche in the premium economy and that’s exactly where we’re doing.”

Joon Aun Oi is president of APAC for Wyndham.

Growth in Asia Pacific

Joon Aun Oi said Wyndham also has premium economy strategies in Asia Pacific that aren’t so much predicated on a shift in demand but more about trying to take market share from local players.

“We’re trying to capture or steal away the demand that’s existent because a lot of it is dominated by local players,” he said. “Consumers are looking for a trusted brand, clean room, good safety, and someone they can complain to that will listen. It’s based on hitting the budget economy segment because the demand is really there. We’re just trying to take it from the local players.”

Wyndham said during its first-quarter earnings that demand in China is steady, but RevPAR declined 8% year-over-year. Joon Aun Oi said he still sees a lot of reasons to be optimistic for the rest of 2025.

“The growth is there still… but if you look at the statistics of number of hotel rooms per capita, China is still markedly lower than established markets like USA,” he said. “So, the opportunity is still humongous.

“We are cautiously optimistic and seeing positive improvements throughout the remaining part of the year. That is aided by a few factors… inbound travel is increasing recently… and flight capacity is getting better and better. So, we’re seeing more and more inbound tourism.”

Latin American development

Viescas said the strategy for conversions is extremely important in the Caribbean and Latin America because so many hotels in the regions are independent.

Gustovo Viescas is president of LATAMC for Wyndham.

“They need a big brother because it’s almost impossible to be independent and aware of and connect with all the changes that are happening really fast,” he said.

When approaching an independent hotel about converting to Wyndham, Viescas said he uses a very specific strategy.

“Our first strategy is… instead of saying, I want this brand in this city, [we ask] which is the brand that fits better for this project with the main purpose of avoiding doing a large rebuild for this property,” he said. “If the owner wants a higher brand, we are going to accept the request. But our first approach is that, and it’s about the conversation with the owner and I’d love to make the owner feel that he has the brand that he wants for his property.”

Viescas said, unlike in Europe, that usually means an individual owner as opposed to an institutional one.

“In Latin America, all the hotels are mainly independent and family offices… So, it’s a good one-on-one conversation with the owner to say, let’s find something in the middle to make [them] happy,” he said. “For most of them, having a hotel is not just the city having a place to receive receiving people. For some of them, receiving guests in their hotels is like receiving people in their own house.”

Editor's note: Wyndham paid for some of the expenses for the reporter's trip to this conference, but it did not influence coverage of this event or future coverage about the company.