Formed by Pebblebrook Hotel Trust and six independent and lifestyle management companies, Curator Hotel & Resorts Collection offers owners of independent and lifestyle hotels greater economies of scale, while helping them reduce costs and maintain their properties’ identities.
Primary Category: Ownership
REPORT FROM THE U.S.—Pebblebrook Hotel Trust and six independent and lifestyle management companies have come together to create the Curator Hotels & Resorts Collection.
Launching today, the collection is targeted to owners of high-quality independent and small-brand lifestyle hotels resorts who want better deals for the products and services at their properties. Along with Pebblebrook, Benchmark Global Hospitality, Davidson Hotels & Resorts, Noble House Hotels & Resorts, Provenance Hotels, Springboard Hospitality and Viceroy Hotels & Resorts are the founding management partners. Altogether, the initial group owns and manages 120 lifestyle and independent properties.
Pebblebrook Chairman, President and CEO Jon Bortz said scale is critical for the collection to launch, grow and “really be something.”
John Belden, chairman and CEO at Davidson Hotels & Resorts said the collection is owner-centric, and focused on preserving a property’s value and standing. Cost savings are driven by scale that helps to leverage vendor negotiations, he said.
Hotels in the collection will also share business intelligence reporting, industry insights and proprietary tools and technology solutions.
“It’s a lot of back-of-house applications, whereby an owner can allow Curator to help them save money so they can focus on the very experiences that help them attract guests in the first place,” he said.
The collection can appeal to owners of truly independent properties, which are not part of any larger management company, as well as owners who work with a third-party operator, Benchmark CEO Alex Cabañas said.
“Our collective scale will bring us benefit above and beyond what we do as a third-party manager, and It’s going to be worth the price given the flexibility and the pricing that is being created here,” he said. “That value proposition is pretty easy to justify to an owner, and it doesn’t take away from anything that Benchmark does. It’s additive to what we already provide our properties.”
The idea for the collection began with portfolio-wide initiatives at Pebblebrook to focus on the value of its independent lifestyle hotels, Bortz said.
“Curator is something that we feel has legs, that has sort of a disruptive place in the industry perhaps,” he said.
In the last year, Pebblebrook began putting the collection together with its independent lifestyle operators, who signed with expectations that it would grow outside of the portfolio.
Curator will be a separate for-profit company, with Pebblebrook as a majority owner and the other founding members as minority owners.
Pebblebrook will provide the initial staffing, but Curator is listing open positions with the goal of becoming fully independent. Those positions are not expected to be filled by the founding companies.
Founding and future members will form a board of advisors to explore options and opportunities and make decisions for the collection.
Joining the collection will be a short-term commitment, which owners can exit at any time, Bortz said.
“We call it an honest system, frankly, like most businesses where you have to prove your value to your customer every day,” he said.
The power of scale
After Pebblebrook acquired LaSalle, it was able to negotiate better deals with its vendors which were rolled out across the combined portfolio, Bortz said. Operators of those properties eventually signed on to agreements to take advantage of the savings on products and services.
The interest among operators of independent and lifestyle properties, to stay independent and partner to benefit from cost efficiencies achieved through scale, highlighted an opportunity for Pebblebrook, Bortz said.
“We could give them a financial alternative that was attractive, where we could improve the economics of their hotels that they operate,” he said.
Cabañas said the concept is similar to how brands consolidated buying power years ago.
“Fundamentally, we benefit from being members while having the flexibility to curate our offers, and we can still go out and compete and still have our differentiated third-party management platforms and brands that really work together in the areas where we all benefit and save,” he said.
Consolidation within the hotel industry is inevitable, Bortz said. The cost of doing business was growing before the pandemic, and it has only accelerated since, he said.
“The pressure to find an improved business model is what Curator is intended to help address,” he said.
Growing the portfolio
The collection will open with all of Pebblebrook’s independent and lifestyle hotels and resorts, Bortz said. Provenance has committed 10 of its hotels as well.
The other founding management company partners will approach their owners about joining the collection, with a pitch focusing on flexibility and cost savings, Cabañas said.
The collection of independent hotels is also open to small, branded properties that fit within the lifestyle category, and requires a quality rating of between three-and-a-half stars and four-and-a-half stars on websites such as TripAdvisor, Expedia or Google.
“The idea is Curator is not going to impose a bunch of standards or requirements for the property,” he said. “That quality level will be determined by the customer.”
To compete with the distribution networks of the global hotel brands, the Curator website is being designed to showcase its member properties.
Whereas a platform like Roomkey was a transaction engine that listed properties for guests to book, Curator is like a catalog, where travelers can seek out different types of experiences and consider quality and price points within the independent lifestyle and resort space, Belden said. The site will redirect guests to the hotel’s own website to book reservations.
“Curator is not is not intended to be the identity of the hotel,” he said. “It is just a collection under which you can find all of these unique small brands and independent hotels. Curator is never to be the star. The hotel’s identity is always to be the star.”
The website will allow guests to search by destination or experiences—for example, nearby outdoor adventure activities, museums and other cultural spots, beaches or dining, Bortz said.
Bortz said when he entered the hotel industry from commercial real estate development, the first thing he realized was how collegial the hotel industry is and how that made a large industry feel small. There are a lot of competitive issues and a lot of common issues, he said.
The collection could take away some of the competitive advantage of larger properties, but also could help some smaller hotels from being acquired by a larger company, he said.
“We have a better chance of survival and maintaining our individual personalities and our individual businesses if we work cooperatively together,” he said.
Collection members will have opportunities to differentiate their properties, while cooperating and competing for business just as they have in the past, Bortz said.
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Headline: Curator launched to leverage scale for indies
Article Date: 11/17/2020
Article Time: 9:51:00 AM