Panelists speaking about hotel development at the 2023 CHRIS/HOLA conference open up about how they’d invest $100 million of their own money in this complex region.
MIAMI – Hotel development thought leaders Wendy Chan, vice president, feasibility and development planning, Marriott International; Justin Magazine, senior vice president business development, Aimbridge Hospitality; Fernando Mulet, EVP, chief investment officer, Playa Hotels & Resorts; and Brian Quinn, chief development officer, Sonesta International Hotels provided a detailed guidebook to the hot spots and top trends in the Caribbean during their session on development at the recent CHRIS/HOLA conference in Miami.
They talked about the subtleties of strategies they’re using to expand brand networks, find projects and partners, secure financing and drive revenue generation around this hot market.
They delved into the changes that dominate this fast-maturing marketplace—from a major influx of global hotel brands to the new emphasis on conversion and an ongoing love affair with luxury and all-inclusives.
Their ability to uncover subtle opportunities has built brands and driven revenue generation for national and global hospitality giants. But how would they shop those opportunities if they were investing their own money in the region?
Panel moderator Mary Scoviak, managing editor, Hotel Investment Today, challenged them to give up the details on where and how they’d invest $100 million from their own pockets.
Here are their takes.
Chan: I’m not going to name a particular market because I want to remain friends with everyone, but I think I’d go into the premium luxury space, perhaps with branded residences. I think the Caribbean is ripe for that type of development because there are so many exotic destinations and so many special destinations. So, that's where I would put my money on a personal level. I would also build a unique hospitality suite in the region. And I would do it in a market that provides tax incentives. Personally, I'd also want to build a hospitality school to train people who live in the region.
Magazine: A rehab center [Magazine was recovering from shoulder surgery and was wearing a sling during the discussion]. I don’t know how much that would buy in the luxury space now, with some hotels trading at a million a key. I’d go into the ultra-luxury, all-inclusive space, not only for families but for bleisure travelers. I think the brands are getting smart about offering more flexibility in the space. For example, Marriott International not only has the luxury JW Marriott flag but a soft brand in that sector. That creativity makes it easier to create a differentiated offer within a 500-room hotel complex, with different options and price points. So, you can have a family-friendly all inclusive and one for couples looking for an adults-only pool on the same site.
Mulet: I’d go into multi-branded resorts. You can have operational efficiencies so that what the customer perceives as a 300-key hotel can leverage the economy of scale of a 1,000-room property. A centralized kitchen can shave a substantial amount of cost without impacting the guest experience. And those brands don’t need to be within the same family. You can have a Kimpton and a Marriott on the same site. That mix becomes part of the value proposition.
Quinn: I really do believe the untapped opportunities in these regions are the rare, unique experiences you can have, such as on volcanic islands or sandy beach islands. Consumers are starved for something authentic. These islands are incredible. They all have their own story. They all have their own personality. They all have an incredible history. You can get in there and inculcate yourself into the culture and deliver a product that delivers on that culture.
Every Island is unique, and I think you can lean into that and take something that might have been a weakness 20 years ago and take advantage of the fact that the consumer wants it. It's a strength right now and you can get margin from that. And they know it. The island leaders know it. So that's your first partner when you get when you get there.