Hospitality in the News

Quick read

Your latest instalment of articles and opinions from across the hospitality sector.

TW: Thinkingdifferently

Lifestyle is back! Students of hotel history will know Barry Sternlicht is credited with creating the first lifestyle Hotel in 1998 with the launch of the W New York. Since then the sector has grown steadily but really accelerated in the last 10 years with the rise of the millennials and their endless quest for Instagram-able "experiences". Savvy operators have realised they can charge a premium room rate and increase revenue per sqm by offering hospitality with cool design, funky interiors, a trendy bar and great food, as well as a good night's sleep.

With its investment into 25hours and SBE, Accor clearly already saw this as a future area of growth – lifestyle today accounts for circa 5% of Accor's fees and 25% of pipeline fees (post-merger). This week's announcement of its plans to combine with Ennismore and create a new mega lifestyle operator of brands such as The Hoxton, Delano, Mondrian, Mama Shelter, 25hours, TRIBE, Jo&Joe and 21c Museum Hotels (no – we'd never heard of this either) is a logical development of this strategy.

In our view, Accor is onto a winner. COVID-19 has shown that people really want to connect, create memories and share experiences together. This presents an exciting opportunity for hospitality to bounce back from the lows of 2020. Others will follow; expect to see the word "lifestyle" popping up everywhere…

For the uninitiated, "lifestyle" brands were created to attract millennials and to offer easy access to extra facilities reflecting current trends, such as destination bars and restaurants. These offerings were more commonly found in boutique hotels but the big brands have realised that innovative, contemporary offerings such as a bowling alley, a grab and go burrito restaurant and turning the hotel into a "chocolate" hotel, are capable of attracting a crowd that they previously didn't appeal to, as well as providing a secondary source of income on top of the traditional room sales.