Choice's upper-upscale soft brand targets owners, developers eyeing boutique, independent upside.
NORTH BETHESDA, Maryland — Choice Hotels International grabbed B2B and B2C headlines with its Oct. 3, 2024, relaunch of Radisson Individuals in the Americas. But it’s the backstory on how this upper-upscale soft brand is leveraging the intersection of consumer and owner/developer demand for highly curated experiential hotels that is making news in the hotel investment community.
Radisson Individuals offers hotel owners and developers white-space growth opportunities in a red-hot market niche: upmarket full-service boutique and independent hotels that use bold design rooted in local culture, immersive regionally inspired F&B, wellness amenities and outstanding service to spark the thrill of exploration, delivering unique experiences at every turn. Catering to guests' innate curiosity for the untold stories of the brand's hotels, and their destinations, have to offer, these properties “stand out in a sea of sameness.”
Radisson Individuals shifts its development and owner support initiatives to align with the unique nature of one-of-a-kind properties, emphasizing the flexibility that comes with a soft brand. For prospective owners and franchisees, the selling point is clear: the freedom to craft distinctive experiences that stand out, supported by a corporate infrastructure that ensures consistent quality and proactive assistance. This combination allows for the creation of truly unique guest experiences while maintaining a strong commitment to service excellence.
In this exclusive interview, Mark Shalala, senior vice president development – upscale brands and real estate, Choice Hotels, talks about the strategies, innovation and investment that amplify Radisson Individuals’ differentiators to the investment world and the travel community.
Hotel Investment Today (HIT): What metrics made Choice take a closer look at the potential of soft brand growth in the boutique/independent ownership base? What convinced you that owners who fought through COVID to avoid affiliation even with soft brands are ready to sign on now?
Mark Shalala: A soft brand like Radisson Individuals gives owners an opportunity to tap into growing customer demand at the best value. Like CBRE and others, we’ve seen a clear shift in travelers’ preference for upper upscale hotel stays. We’ve also found that many of these travelers are looking for more authentic experiences and are willing to pay a premium for hotels that can deliver that.
Developers have certainly keyed in on this, and they’re putting their investment dollars in this space. Soft brands have become more attractive in this climate because of the flexibility they provide. It costs significantly less to adapt an upper-upscale property to take on a soft brand identity than to pursue a new-build. We know smart investors are hyper-focused on lowering costs and deriving the most value from their assets, which makes a brand like Radisson Individuals especially appealing to them.
Our primary target are owners of independent and boutique hotels who want to preserve the unique character of their properties...we are also considering adaptive reuse opportunities and possibilities to convert traditional branded hotels to soft brand concepts in major markets.
Mark Shalala
HIT: Who’s your primary target in terms of owners and developers and how do you make the brand appeal to lenders?
Shalala: Our primary target are owners of independent and boutique hotels who want to preserve the unique character of their properties. That said, given the explosion in demand in the soft brand segment, we are also considering adaptive reuse opportunities and possibilities to convert traditional branded hotels to soft brand concepts in major markets.
HIT: What questions are these owners and developers asking you? what are their paints and how are solving them?
Shalala: We’re seeing a lot of curiosity about how Choice can support them if they convert their hotel to a Radisson Individual. Many owners and developers are looking for a strong and reliable partner that can help them maximize the potential of their property and acquire guests at the lowest cost possible.
We are uniquely positioned to accomplish that, namely because we have a toolbox that has helped owners from our other brands draw repeat stays from guests and drive more return on their investments. By joining Choice, owners can benefit from our powerful distribution engine, leading tech solutions, a more than 66-million-member loyalty program and the 89% brand recognition of Radisson Individuals — all while maintaining the special identity of their hotel.
HIT: What did Radisson itself, Radisson Individual, Choice’s other soft brands and current and prospective owners teach you about the musts a soft brand has to have to attract the target owner/developer in this space?
Shalala: Choice was the first company to establish a soft brand, Ascend, so our insight in this space is unmatched. We’ve learned a lot from that history, which has informed our relaunch of Radisson Individuals.
A key lesson is to be tuned in and adaptive to consumers’ needs. Knowing that travelers are increasingly repelled by cookie-cutter hotel experiences, we are re-introducing Radisson Individuals to give them the more personalized experience they’re looking for with the features they care most about. This means these hotels should fully embrace the character of their location through design and the food and wellness experiences they offer, while also being wholly focused on giving the absolute best guest experience.
Mark Shalala, Choice Hotels
HIT: How much was this relaunch about moving the needle and how much about diversifying Choice’s ownership or opening new markets?
Shalala: In recent years, Choice has made significant investments to grow in the upscale sector. We’ve become the ones to watch in this space with more than 700 upscale hotels open or in the pipeline across our Radisson Americas, Cambria and Ascend brands.
Against this backdrop, the relaunch of Radisson Individuals is particularly significant because it marks an expansion of our upscale tier, following our relaunch of Radisson Blu earlier this year.
It's an exciting opportunity that we are giving owners to join our winning platform with a hotel offering that caters to changing travelers’ expectations. In studying the landscape, we’ve seen the upscale and upper upscale soft brand competitive set outperform the branded upscale groups in most markets. It’s an indication of the change in travelers’ tastes and their willingness to pay for a product like Radisson Individuals.
HIT: Choice’s investment in the upmarket sector is giving its loyal guests a self-curating menu of options. Although no two hotels are the same, how will you ensure that the standards and services that apply to the hard-branded hotels will keep their soft-branded sisters as consistent in their design and services?
Shalala: Part of what we’ve done with this relaunch is introduce brand pillars so that prospective owners or developers of these hotels have a clear understanding of what their property should offer to match what a Radisson Individual should be. Our target audience expects each hotel to be individually unique. But they can also expect that each will deliver high-quality service, offer on-site amenities like a wellness center and pool and give them an experience that feels authentic to their destination, such as a restaurant serving local-inspired food.
HIT: What’s in the pipeline? How many hotels do you expect to add by the end of 2025?
Shalala: We currently franchise 15 hotels across the Americas. Our ambition is to significantly scale that and bring these hotels to major cities and popular leisure locations. We are in advanced talks with a significant number of U.S. hotels in a mix of markets, including some high-end leisure destinations and semi-urban locations. We expect our growth will come largely from conversions, but we are also exploring adaptive reuse projects.
Mary Scoviak is custom and design content director, Hotel Investment Today by Northstar.
The views and opinions expressed in this content do not necessarily reflect the opinions of Hotel Investment Today by Northstar or Northstar Travel Group and its affiliated companies.