Interstate Hotels & Resorts is a true innovator in the hospitality industry and are recognised as the leading third-party hotel management company in the world. Here, RLI sits down with Nicholas Northam, Executive Vice President – International to discuss how the company’s owners benefit from their unique and extensive expertise.
Interstate Hotels & Resorts is the international division of Aimbridge Hospitality, the industry leading company that has around 1,400 hotels under management in the US. Interstate Hotels & Resorts, who operate 100 hotels in the UK & Ireland and a further 40 hotels in continental and eastern Europe, merged with Aimbridge Hospitality around 18 months ago and they operate across 11 countries in Western and Eastern Europe.
As the leading global management company specialising in third-party hotel management, the company has a proven operating strategy that combines scale with agility in deploying resources focused on achieving hotel owners’ investment goals.
Before the onset of Covid-19, the company had just had an exceptional 2019, with excellent growth in terms of the number of hotels that they had brought on board, with 10 to 12 new additions and the portfolio as a whole was performing strongly. October of that year was also when the merger with Aimbridge Hospitality took place and Brexit was the topic on everyone’s minds.
“Despite everything that happened across the world last year, 2020 was actually the best year we have ever had in terms of bringing on new hotels as we brought 38 hotels into the Interstate family, which represented a tremendous achievement and took us to over 100 hotels in the UK, the flipside was they were all empty!” Nicholas Northam, Executive Vice President – International at Interstate Hotels & Resorts says with a wry smile.
A lot of their portfolio closed at the beginning of the pandemic, however this changed quite quickly when it was realised that a selection of people were still travelling, and so the vast majority of their hotels re-opened, albeit with a significantly scaled down
“We spent a lot of time and energy on training and making sure that we operated safely. This was the key focus for us, making sure our environments were safe for both the teams in the hotels and the guests coming to stay.”
This year will see the opening of six additional hotels in the UK and continental Europe and while Nicholas feels new builds have slowed down for sure, he believes there will be further development opportunities in the future as the fluctuating market continues to affect operators and owners.
In terms of new markets for the business, continental Europe remains a huge opportunity for Interstate as they look to firstly add to their already 100-strong portfolio in the UK and Ireland, and secondly to add to their footprint in the Netherlands, France, Italy, Germany and Spain, which is a market they are not yet in but believe there is real opportunity for growth.
“We have an office in Amsterdam so we have a team based in continental Europe so the plan is to grow in those markets and we’ve got a foothold in Europe and if we need to open offices in other countries we have the capacity to do this,” explains Northam.
The role of Interstate is to maximise the demand that arrives in a particular area, so for them the old adage of location, location, location remains as strong today as it ever has. These are not destination-led hotels, what the company does is manage the hotels already situated in highly sought after locations and make sure that their product, their service, their people, their team and everything that they offer in the hotels is the driver behind people choosing to stay in their hotels when visiting a certain destination.
So what does Northam feel are the key drivers behind the company’s success?
“First and foremost I believe it is scale of the organisation. Because of our size, owners feel safe and secure in asking us to manage their hotels and as such, we have best-in-class operating systems, resources, people and talent… everything you would expect from the perspective of a large, multi-national organisation. In total we manage around 35 different brands, including being the largest operator of Marriott, Hilton, IHG and Hyatt Hotels worldwide.”
E-commerce and social media has become an important area for Interstate, to the extent that even just five years ago they did not have an e-commerce department, and now they have a dedicated one focusing entirely on e-commerce matters. As for social media, Northam comments that the company is represented on all major platforms as they look to stay ahead of the curve, noting that whether it is a bedroom, a meeting room or a restaurant, the first place people visit is social media to make sure the brand is well represented.
When looking to the future, Northam feels that continuing to grow the company against the backdrop of the global pandemic is the greatest challenge Interstate have in front of them.
“Our ability to grow is fundamental to our success because the more hotels we have, the more our scale and ability is amplified to the benefit of our people, the guests who stay in our hotels and our owners. Our mission is to be the best third party manager in the world and this is what we strive towards day in and day out,”