STAY Magazine ... Vol. 4, Issue 2

Page 18

The 2024 CANADIAN HOTEL INVESTMENT Issue

The symbiotic relationship between hotel asset management and revenue optimization

Hospitality AI bots and humans are finally getting along

SUCCESSION: Canadian hotel dynasties: Who are they & what makes them tick?

How women executives are redefining leadership in the business of hotels

SPRING 2024
5 EDITOR’S NOTE 6 NEXT-GEN BUSINESS What is the role of a corporation in society? 8 SUSTAINABILITY MATTERS It’s time to tell our sustainable hotel stories 12 GREEN KEY GLOBAL Helping hotels toward environmentally responsible and efficient practices 15 TECHNOLOGY Hospitality AI bots and humans are finally getting along 19 SUCCESSION – PART ONE Canadian hotel dynasties, who are they & what makes them tick? ON THE COVER Accent Inn’s Mandy Farmer and Pat Gillin of Gillin Hotels CONTENTS SPRING 2024 26 CHOICE HOTELS Distinguished women leaders within the Canadian hotel industry 31 THE 2024 CANADIAN HOTEL INVESTMENT OUTLOOK 44 ASSET MANAGEMENT Defining AND understanding the role of the hotel asset manager 48 HYATT STUDIOS Revolutionizing extended-stay hospitality 50 REVENUE MANAGEMENT The balancing act
DESIGN Interior design trends for hotels from IDS 2024 12 THE 2024 CANADIAN HOTEL INVESTMENT OUTLOOK 31 44 STAYMAGAZINE.CA 3
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SPRING 2024

Volume 4 Issue 2 staymagazine.ca

PUBLISHER

Big Picture New Media

EDITOR-IN-CHIEF

Stacey Newman

stacey@staymagazine.ca

DIRECTOR OF SPONSORSHIP & ADVERTISING

Mike Egan mike@staymagazine.ca

ART DIRECTION + DESIGN

Sonya Clarry + Brienne Lim

CONTRIBUTORS

Jim Byers, Tim Wiersma, Jessica Gedge, Allan Lynch, Chris Gibbs, Harrison Stone, Michael Bradford, Stacey Newman

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STAY is published four times per year by Big Picture New Media (BPNM), a subsidiary of Big Picture Conferences. For 27 years, Big Picture has been hosting the Canadian Hotel Investment Conference (CHIC) and other go-to conferences and events for Canada’s hotel industry. Subscription price: $110 per year, most single issues $18.95. For subscription Inquiries, please visit staymagazine.ca/subscribe

EDITORIAL ADVISORY BOARD

Robin McLuskie Managing Director, Hotels, Colliers Hotels

Brian Leon President, Choice Hotels Canada

Brian Flood EVP and Practice Leader, Hospitality and Gaming, Cushman & Wakefield

Scott Richer VP, Real Estate and Development (Canada), Hyatt Hotels

Ed Khediguian Senior VP, CWB Franchise Finance

Bill Stone President, Knightstone Hotel Group

Gunjan Kahlon VP Franchise Sales and Development, Wyndham Hotels & Resorts

Judy Sparkes-Giannou Co-Owner, Clayton Hospitality Inc.

Deborah Borotsik Senior VP, Beechwood Real Estate Advisors

Alan Perlis President & CEO, Knightstone Capital Management and CEO, Knightstone Hotel Group

Alnoor Gulamani President, Bayview Hospitality Inc.

Christina Poon General Manager, Hotel W New York – Union Square

Phil Thompson Business Lawyer, Thompson Transaction Law

Sandra Kanegawa Owner, Heritage Inn Portfolio, X-Dream

WELCOME TO OUR 2024 CANADIAN HOTEL INVESTMENT ISSUE…

I’M THRILLED TO INTRODUCE OUR CANADIAN HOTEL INVESTMENT ISSUE OF STAY MAGAZINE, AN EXAMINATION OF THE TRENDS, INNOVATIONS, AND LEADERSHIP SHAPING THE FUTURE OF HOSPITALITY IN CANADA.

In this issue, we explore the enduring legacies and innovative visions of family-owned gems and avant-garde establishments alike, spotlighting the Gillin Family’s stewardship of the Lord Elgin Hotel and Mandy Farmer’s Hotel Zed.

This edition dives into the notion of modern hospitality, where the pursuit of profit meets the imperative of social responsibility. We explore the delicate balance businesses must navigate to thrive while contributing positively to society, especially within the vibrant context of the hotel industry.

Sustainability is not just a buzzword but a pivotal focus, as we highlight the Canadian hotel sector’s leadership in embracing and surpassing global environmental standards. We bring you information on the collaboration with Green Key Global and HAC as they advocate for policy and offer programs aimed at building truly sustainable operations, while the latest in hospitality technology showcases the seamless integration of AI to enhance customer service.

Investment insights, asset management essentials, and the symbiotic relationship between revenue optimization and asset management offer our readers a deep dive into the financial and strategic underpinnings essential for success in this dynamic industry.

This issue also offers a foray into the intersection of interior design and hospitality, revealing the latest trends that are shaping the communal nature of the hospitality spaces of tomorrow’s hotels.

I invite you to join us in this insightful exploration of Canadian hotel investment, where each page turns to unveil the challenges, opportunities, and innovations driving the evolution of hospitality.

I invite you to send me your comments, questions and stories to stacey@staymagazine.ca. Thank you for reading!

EDITOR’S NOTE
STAYMAGAZINE.CA 5

WHAT IS THE ROLE OF A CORPORATION IN SOCIETY?

Throughout history, humanity has pondered plenty of complex questions, from “Why does rain fall?” to “Are we here for a reason, and if so what is it?” Some questions, like the former, humanity has answered by studying the universe, but others are more subjective.

Why do humans so often choose to stand in safety on shores of black and white instead of learning to swim the seas of grey? Why do we seem to frequently diminish a nuanced question to an artificial binary?

One such question more pertinent today than ever is, “What is the role of a corporation in society?” which has largely been reduced to “Should corporations act solely as profit-seeking entities, or seek to benefit society?” I believe this presents a false dichotomy. In reality, organizations can grow profits while simultaneously decreasing their detriment or increasing their benefit to society. In this article, I explore how and why we’re asking this question in the first place, and provide examples of how companies have managed to bridge the illusory gap between profit growth and societal benefit.

Implementing measures that allow employees to directly pursue both their career and personal goals, be more adequately compensated, and feel more appreciated are straightforward ways companies can reduce turnover.

First of all, how have people sought to answer this question in the past? Milton Friedman was an esteemed American economist who promulgated what today is commonly understood as the “Stockholder Theory.” In 1970, he published an article in The New York Times titled “The Social Responsibility of Business is to Increase Profits.” His answer to the question was that the full extent of a business’s responsibility to society is to grow profits while following all laws and regulations. He accuses anyone who thinks otherwise to any extent of “pure and unadulterated socialism”. He maintains that it is the government’s responsibility to tax the population and allocate said taxes to address social concerns, and that corporate executives working towards social concerns are in effect imposing a tax on the shareholders to whom they owe a fiduciary duty. He argues that the government is made up of elected officials who adhere to checks and balances which ensure the actions they take align with the interests of the population (1)

Interestingly, he does not liken an executive taking a bonus (which could instead be distributed as dividends to shareholders, allocated towards capital expenditures, or retained as cash to

NEXT-GEN BUSINESS
6 SPRING 2024

maintain liquidity) to a breach of fiduciary duty. The only “misallocation” of funds he deems to breach fiduciary duty are those where the funds are put towards the common good. I understand why he felt the need to speak out so absolutely against these ideas of “social responsibility” and the “common good” at the time. Friedman published his paper during the time of the Cold War when the spread of socialism was widely viewed as an urgent threat to free society. Because of this, many people lived in fear of these ideologies, and thus any alternate perspectives were demonized.

I am by no means a proponent of socialism—my problem is with how he went about communicating his ideas, and some false assumptions he made. He states that the government will always act in the best interest of the public but we can observe this is not always true. As an example, a country’s government may provide bailouts to certain (typically larger) companies in times of economic strife, while leaving other (typically smaller) companies to fail. He argues that executives making decisions in accordance with perceived societal good is a breach of fiduciary duty, but fails to mention the many real ways fiduciary duty may be breached under our current system (i.e. large bonuses, golden parachutes, etc.). Finally, he implies that the pursuit of social welfare and profit growth are mutually exclusive, which is unequivocally false. Overall, Friedman’s 1970 article greatly influenced our understanding of the role of corporations in society today, and left a necessary middle ground out of the discussion.

Now let’s look at how some companies have innovated and transformed to meet profit and social benefit goals simultaneously. In 2021, The Halifax Marriott Harbourfront Hotel installed an AI-driven HVAC system, which factors in a multitude of information while interfacing to reduce a building’s energy consumption resulting in annual electricity and natural gas savings of 20 per cent and 18 per cent respectively (2)

Similarly, through actions such as installing efficient water fixtures, stormwater management, and water recycling systems, Hilton has reduced its water consumption for managed hotels by 33.4 per cent from 2008 to 2022 (3). Both undertakings resulted in direct cost reduction (and by proxy profit increase) for the companies while reducing their negative impact on the environment.

In the hospitality industry, employee turnover poses a significant challenge for companies. As an example, replacing a front-of-house employee can cost a hotel up to 500x-600x their hourly wage—a $20 hourly wage equates to approximately $10,000-$12,000 in turnover (4). Implementing measures that allow employees to directly pursue both their career and personal goals, be more adequately compensated, and feel more appreciated are straightforward ways companies can reduce turnover. As an example, Hilton’s adoption assistance program provides a $10,000 grant to employees seeking to adopt children (5). This amount of money is presumably easily manageable by Hilton but makes a significant change in the life of an employee. Moreover, if this grant makes an employee stay with the company longer, this avoidance of turnover cost will save the company money.

Research demonstrates that throughout history, there is a great variety of initiatives companies can take to simultaneously drive profits and social good.

Instead of characterizing difficult discussions as two-sided, we should always look for a rational middle ground. Failure to do so often leaves the optimal solution out of reach. Perhaps if the question, “What is the role of a corporation in society?” was commonly discussed in this manner, more businesses would take real actions to benefit the world instead of enacting ostentatious policies, throwing around buzzwords in annual reports, or doing nothing at all.

A NOTE FROM THE AUTHOR

My name is Harrison Stone. I am a 21-year-old student studying business in London, Ont. Throughout my life, I have observed the way we seem to handle “controversial” discussions or disagreements. It is indeed true that we have our differences. We all have different preferences, goals, and different ways to go about achieving said goals. We each individually possess a unique combination of life experiences and tendencies which independently shape the way we perceive reality and choose to act within it, but ultimately we are all human. It seems today, people are quick to forget this underlying reality when engaging in dialogue with someone whom they disagree with. People seem to see their ideas as part of themselves and seek to defend them like they are defending their own lives. They stay set in their views, refusing to listen to people on the other “side”, and characterizing them as some type of “other”. Oftentimes, the solution both “sides” are seeking is found somewhere in the middle.

1. https://www.nytimes.com/1970/09/13/ archives/a-friedman-doctrine-the-socialresponsibility-of-business-is-to.html

2. https://serve360.marriott.com/wp-content/ uploads/2022/10/Marriott-2022-Serve-360ESG-Report-accessible_F.pdf

3. https://esg.hilton.com/wp-content/uploads/ sites/4/2023/04/Hilton-2022-EnvironmentalSocial-and-Governance-Report.pdf

4. https://ecommons.cornell.edu/server/api/ core/bitstreams/239ec8ff-0dac-4142-945c0c28be3e523e/content

5. https://jobs.hilton.com/us/en/blogarticle/ celebrating-national-adoptionday#:~:text=In%20addition%2C%20the%20 cost%20to,were%20going%20to%20be%20 parents

STAYMAGAZINE.CA 7

HOTELS AND SUSTAINABILITY, PART 1

It’s time to tell our sustainable stories

A Chinese proverb says, “The journey of a thousand miles begins with a single step.” The quotation is from the classic Chinese text “Tao Te Ching” ascribed to the philosopher Lao Tzu. And for Germain Hotels, those steps to sustainability include rethinking slippers.

Sustainable hotel operations became a recent focus of the World Tourism & Travel Council (WTTC). The organization is made up of members from the global business community and works with governments to raise awareness about the travel and tourism industry. According to several business publications, WTTC is known for being the only forum to represent the private sector in all parts of the industry worldwide. Its activities include research on the economic and social impact of the industry and its organization of global and regional summits focused on issues and developments relevant to the industry.

In March 2023, WTTC launched its Hotel Sustainability Basics guidelines. The WTTC’s criteria for sustainable hotels was a 12-item action list under three main categories: Efficiency, Planet and People. For Efficiency the WTTC lists measuring and reduction of energy use, water use, waste and carbon emissions. For Planet, the criteria are linen reuse, green cleaning products, vegetarian options, no plastic straws and stirrers, no single-use plastic water bottles and bulk amenity dispensers. For People, the WTTC expects community benefit and a reduction of inequalities.

It may be necessary for some parts of the world to have such guidance, but Canadian hoteliers have been implementing these and similar ideas for the last 30 years. We didn’t always call it sustainable, we spoke of “greening the bottom line” or as an element of eco-tourism, but the reality was—and is—being good for the climate is now better for business. That said, our inherent national modesty can make us seem behind trends in the public consciousness as we read headlines across channels and bemoan “They should do more.”

SUSTAINABILITY MATTERS
8 SPRING 2024

While people are keen to suggest hotels and other travel partners should do more, most guests have little to no idea about the thoughts and actions which have gone into operations. Canada’s problem is that we don’t tell our story. The public expects U.S. and European properties to be trend leaders, overlooking Canadian innovation. As the adage goes: “You can never be a hero in your hometown.”

It’s time to tell our sustainable stories, starting with those slippers.

Marie Pier Germain, vice president of sales and marketing for Germain Hotels, says, “Sustainability is a top priority for us and we have set ambitious goals. New technologies and innovation in construction allow us to reduce the impact of our operations. The design of our hotels includes several aspects that make them more energy

EXPERTS IN FRANCHISING ACROSS CANADA.

VISIT SUPERIORLODGINGCORP.COM OR CALL 403.543.8800
The best way to avoid greenwashing is to communicate with transparency about our sustainable journey, our vision, our goals, and every step of the process.”
Pier Germain,

“Most of our standards, like the ones related to construction and local purchasing have existed since our beginning in 1988, and are just part of who we are. For the new actions, we were inspired by the 17 Goals to Transform Our World from the United Nations, ISSB (International Sustainability Standards Board) standards, Green Key certification, and the Five Rs: refuse, reduce, reuse, repurpose and recycle.”

In rethinking the removal of single-use items in guest rooms Germain asked local suppliers what they could do together. “For example, we wanted to get rid of our single-use slippers and switch to reusable slippers. Nothing was available on the market so we had to co-create a prototype with our local supplier. We now have something made in Quebec, with Quebec recycled fabric.” Recognizing that buying local can cost more than a cheap import, Germain opted for a change with a bigger impact. “When we choose an item, we look at the durability to ensure changing for the eco-conscious/local option will have an interesting return on investment AND will enhance the guest experience. For example, our slippers were 10 times more expensive, but the fact we can reuse them up to 25 times makes an interesting ROI within four years.”

A key element of the slipper program, as with all change “is to communicate well to our teammates, train them well and give them the right tools. For our slippers project, we started with the superior rooms to ensure the laundry and housekeeping teams were able to deliver this new item in time.”

Communications also armed team members with talking points for guests who were unhappy about the removal of plastic water bottles in rooms and the need for key cards for power. Germain adds, “The best way to avoid greenwashing is to communicate with transparency about our sustainable journey, our vision, our goals, and every step of the process.”

Innovation to sustainability is scalable. Canada’s largest property, the 48-year-old, 1,590-room Chelsea Hotel Toronto is another property which long ago embraced sustainable operations. Tracy Ford, Chelsea’s director of public relations, is also a Green Team member and an ongoing expert contributor to STAY Magazine. She says, “Environmental protection is one of our four focus areas in our corporate sustainability program— CONNECT, as we recognize that our property uses significant amounts of energy, water and other natural resources, as well as generating waste. We endeavour to minimize these impacts on the environment in which we operate.”

The Chelsea Hotel is committed to the criteria provided by the EarthCheck Company Standard and undertakes independent auditing, monitoring and annual benchmarking exercises, living up to its commitment to continually improve its environmental and social sustainability performance. The Chelsea has attained 4-key status under the Hotel Association of Canada’s Green Environmental Program, Green Key ECOmmodation and Green Key Meetings as well as the EarthCheck Gold certification.

As foundational elements to translate ideas to action, the Chelsea has an EarthCheck coordinator responsible for ensuring ongoing environmental performance and a dedicated Green Team to deploy and monitor environmental initiatives and sustainability programs in-house as well as with suppliers.

For the guest experience, providing the option for electronic receipts saves three million sheets of paper annually. They also offer guests the use of electric vehicle charging stations. Starting with their 2023 guestroom renovations was the installation of motion-sensor thermostats. They have removed water bottles in guestrooms, and added LED lighting and low-flow shower heads and toilets. Bath amenities are provided by Canada’s Truterra, which focuses on local, natural ingredients.

“ 10 SPRING 2024

An earlier renovation saw the installation of an “aspirated” living wall in the lobby. Ford explains, “This draws in contaminated air through the hydroponic wall by use of the natural convection air movement. Pollutants are then broken down by beneficial microbes associated with the plants and clean air is then returned to the occupied space as forest fresh outdoor air.”

While there is a lot of media and social media discussion about sustainability, the Chelsea team’s experience is that meeting planners will ask about it, but not leisure guests. The only noticeable guest resistance seemed to occur when they switched from individual amenity bottles to bulk shower dispensers, but with familiarity and understanding that has been embraced by travellers.

The question for hotels is to audit their messaging to see if they have shared their sustainability story, which can detail past actions, current actions and future actions—let’s be proud of our Canadian sustainability efforts. Read more about the Green Key Global-HAC/AHLA partnership on page 12 in this issue.

This is the first of four parts, where STAY looks at sustainability from the guest experience, back-of-house heavy lifting, green meetings and community involvement.

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UNLOCKING A GREENER FUTURE

THE ROLE OF GREEN KEY GLOBAL IN SUSTAINABLE HOSPITALITY

12 SPRING 2024

We are living at a time when businesses know the importance of adapting their practices to become more environmentally conscious in light of the global climate crisis, but don’t necessarily understand how, why and what that change involves. In the Canadian hotel industry, there is recognition that sustainability is increasingly becoming a core component of operational and strategic planning, with practices that span across all areas of the business.

In this transformative era, GREEN KEY GLOBAL serves as a beacon of excellence and experience in sustainability, helping hotels and hospitality businesses toward environmentally responsible and efficient practices. With an emphasis on sustainability certification, GREEN KEY GLOBAL not only elevates the environmental stewardship of hotels but also underscores their commitment to social responsibility and economic viability.

Achieving a GREEN KEY GLOBAL certification is more than just earning a badge of honour; it’s about real, tangible benefits.

PARTNERSHIP WITH HAC + AHLA

GREEN KEY GLOBAL’s alliance with the Hotel Association of Canada (HAC) and the American Hotel and Lodging Association (AHLA) aims to amplify the program’s impact and reach within the hospitality industry as an opportunity for the associations’ members to access an affordable, best-in-class solution to support their sustainability goals.

HAC and AHLA represent the broad spectrum of the lodging industry across the country and play a pivotal role in advocacy, education, and setting industry standards. By partnering with GREEN KEY GLOBAL, the organizations endorse a standardized approach to environmental and sustainability practices, signalling the importance of these issues to its members and the industry at large.

Advocacy and awareness:

Together, GREEN KEY GLOBAL and HAC-AHLA work to raise awareness about the importance of sustainable practices in the hotel industry. This includes promoting the benefits of Green Key certification to hotels, from small independents to large chains, highlighting how sustainability can drive competitive advantage, operational efficiency, and regulatory compliance.

Educational resources and support:

The collaboration ensures that association members have access to GREEN KEY GLOBAL’s comprehensive suite of resources, including tools for measuring and improving environmental performance, training and educational materials, and best practices for sustainability. These resources are designed to help hotels at every stage of their sustainability journey, from those just starting to consider their environmental impact to those leading the way in sustainable hospitality.

Recognition and credibility:

For HAC and AHLA members, achieving Green Key certification serves as a mark of distinction that enhances their reputation among guests, stakeholders, and the community. The partnership between GREEN KEY GLOBAL and HAC-AHLA lends additional credibility to the certification, reinforcing its status as a leading standard for sustainability in the hospitality industry.

Policy and regulatory influence: Together, GREEN KEY GLOBAL and HAC-AHLA can influence policy and regulatory discussions related to sustainability in the hospitality sector. Their partnership allows them to provide a unified voice on important issues, advocating for policies that support sustainable practices and help hotels navigate the complex landscape of environmental regulations.

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IMPACT ON THE INDUSTRY

The partnership between GREEN KEY GLOBAL and HAC-AHLA is a testament to the growing recognition of sustainability as a critical component of the hospitality industry. It not only facilitates the adoption of sustainable practices among Canadian hotels but also sets a benchmark for environmental responsibility that can inspire others to follow suit. For Canadian hotels, the support and resources provided through this partnership are invaluable in achieving their sustainability goals and positioning themselves as leaders in the global movement towards more sustainable operations.

GETTING CERTIFIED

GREEN KEY GLOBAL stands out with its rigorous certification process, designed specifically for the hospitality sector. This process provides a structured framework, enabling hotels to measure, evaluate, and enhance their sustainability initiatives. Certification boosts a hotel’s reputation, builds trust with consumers, and carves out a competitive advantage in an increasingly eco-conscious market. Moreover, it identifies pathways for operational efficiency, aids in regulatory compliance, and facilitates a positive environmental and community impact.

GREEN KEY GLOBAL certification isn’t just about environmental conservation; it’s about integrating sustainability into the very fabric of a hotel’s operations, encompassing economic and social dimensions. Hotels adopting the Green Key certification are not only seen as environmental stewards but also as responsible corporate citizens and efficient, cost-effective businesses.

Achieving a GREEN KEY GLOBAL certification is more than just earning a badge of honour; it’s about real, tangible benefits. It enhances a hotel’s marketability to eco-conscious travellers, increases operational efficiencies leading to cost savings, and provides access to a wealth of resources. These include a vetted vendor directory, departmental checklists, promotional materials, and educational opportunities.

The path to GREEN KEY GLOBAL certification begins with an online registration and self-assessment, covering various sustainability aspects from energy use to waste management. This is followed by a detailed audit every three years, ensuring that hotels not only meet but continue to uphold the highest sustainability standards. This rigorous process underscores GREEN KEY GLOBAL’s commitment to credible, validated sustainability practices in the hospitality industry.

EMBRACING A SUSTAINABLE FUTURE

GREEN KEY GLOBAL is at the forefront of sustainability innovation, developing tools like the Carbon Calculator, Carbon Neutral Event Certification Program, and Payback Calculator. These tools are designed to help hotels quantify their environmental impact, host sustainable events, and assess the financial returns on sustainability investments. Coupled with educational webinars and a new website featuring a Marketing Toolkit and guest facing materials, GREEN KEY GLOBAL is equipping hotels with the knowledge and resources to effectively communicate their sustainability efforts and engage with guests and stakeholders on a deeper level.

The imperative for sustainability in the hospitality industry is clear. As GREEN KEY GLOBAL continues to lead the way, its certification program stands as a pivotal tool for hotels committed to sustainable operations and contributions to a healthier planet. The benefits of GREEN KEY GLOBAL certification—ranging from enhanced reputation to operational efficiencies and competitive advantage—underscore the value of sustainability certification as a strategic business tool. In this journey towards a more sustainable future, GREEN KEY GLOBAL certification is not just a choice but a necessity for Canadian hotels and hospitality businesses aiming to thrive in an eco-conscious world.

greenkeyglobal.com

14 SPRING 2024

HOSPITALITY AI BOTS AND HUMANS ARE FINALLY GETTING ALONG:

Harnessing the speed of AI in our current economy for customer service

Canada’s tourism industry was a revenue gusher, pumping $106.5 billion into the national bank in 2019 alone. Hotels, processing millions of guests annually, anchor the core part of this active system. Travellers’ memories contain gratitude aimed toward local businesses of the hospitality industry. However, here at this seemingly prosperous junction are potential difficulties. The shifting economic backdrop, with visible cues of the rising cost of living and changing public tastes, certainly keeps hoteliers up at night.

TECHNOLOGY STAYMAGAZINE.CA 15

THE IMPERATIVE OF EXCEPTIONAL JOURNEYS

In the active hospitality, travel and tourism marketplace, with purchase decisions rooted in experience, excellent customer travel experiences are not something that sets businesses apart anymore—they’re a prerequisite for survival. With choices galore and digital transparency empowering decisions, guests have a lot more power today. Their every move can either make a hotel’s reputation soar or doom it to oblivion.

According to a recent Deloitte study, 72 per cent of Canadians are prepared to pay a premium for an experience that goes above and beyond their expectations. This means raising the bar at every touchpoint, from arousing guests’ initial interest during booking to the lingering warmth of the farewell following a pleasant stay.

AI-POWERED FEEDBACK IS A REPOSITORY FOR FUTURE DECISION-MAKERS

Insights can unlock valuable customer demographic information and combine it with in-moment feedback data. For example, AI-powered gender demographics can provide insights for tailoring products and strategies—AI has the potential to form the digital bedrock for businesses to create targeted, personalized approaches, fostering enhanced guest engagement and satisfaction.

GUEST VOICES EMPOWERED BY AI AND DATA INSIGHTS

Fortunately, hoteliers have powerful allies in their quest for guest satisfaction right now: real-time feedback systems powered by AI and its cascade of data insights into guest preferences, behaviours, and moods. Hotels are changing the way they gather and interpret guest feedback with tools that are powered by AI. No longer do they rely only on email surveys or sporadically scrawled handwritten notes. AI-powered sentiment analysis allows businesses to understand whether their service really resonates with the target audience and unlock valuable information to create targeted, personalized approaches, fostering enhanced guest satisfaction.

HUMANS AND AI

When AI was first adopted within the hotel industry, people were cautious, even wary. People in the field were understandably worried that robots would soon be able to displace them. This narrative has reformed. An encouraging change in attitude has been revealed by a recent PWC survey: an astounding 72 per cent of Canadian workers now think that AI would enhance and simplify their jobs. This newfound understanding opens the door to a balanced partnership, a dance in which humans and AI step gracefully, playing to one another’s strengths to provide an unforgettable experience for guests.

A DUET OF STRENGTHS, NOT A SOLO ACT

A sense of mutual benefit is replacing animosity as the barriers between humans and AI dissolve. The hotel industry has come to see AI and humans not as competitors in a zero-sum game, but as complementary parts of a mutually beneficial partnership.

AI is great at data analysis and automation and can give real-time insights, whereas humans are great at navigating complicated situations gracefully and with empathy. With a planned combination of the two, hotels can establish a highly functional service environment that prioritizes the happiness of their guests.

DECODING THE HIDDEN LANGUAGE OF EXPERIENCE

In the same way that trained linguists can decipher the sometimes-esoteric language of customer reviews, AI-powered technologies may do the same. Feedback on room cleanliness, friendliness of personnel, ease of check-in and check-out, amenity quality, and even the thoroughness of housekeeping, are all things that can be available for the hotel’s operations management in real-time. Like a comprehensive map, this granular data helps hoteliers gain a deeper understanding of their customers and make informed business decisions to find their sweet spots and zero in on trouble spots that need fixing right away

ACTIONABLE INSIGHTS TO ADDRESS CONCERNS

From amplifying good comments to addressing poor guest experiences, AI’s unwavering honesty is what makes it beautiful. It brings unpleasant memories to the surface, illuminating them before they become deep scars. Hoteliers may prevent problems—before they become negative internet reviews or a loss of client loyalty—by addressing them quickly and efficiently through empowered openness.

16 SPRING 2024

THE RIPPLE EFFECT OF BAD EXPERIENCES

A bad hotel stay can have an effect well beyond the confines of the room. It has far-reaching consequences, tarnishing internet reputation and turning away a large number of prospective visitors. In today’s hyper-connected world, the impact of even one unfavourable review can be devastating to a hotel’s reputation and the faith its guests have in it. This highlights the need to leverage real-time customer feedback and AI-powered insights to resolve issues proactively since this is the best way to ensure visitor pleasure and protect the reputation of the business.

STAYMAGAZINE.CA 17

2024 AI INSIGHTS FOR CANADIAN HOTELS

Personalization: Make use of AI to create personalized experiences that match each guest’s tastes and habits based on their previous stays. Envision a world where digital concierges provide visitors with personalized suggestions for local excursions, room temperatures are automatically adjusted upon arrival based on previous settings, and favourite amenities are pre-stocked. The amount of personalization provided here makes guests feel truly cared for, which in turn increases their loyalty.

Predictive Maintenance: Move beyond reactive repairs and embrace the power of AI-powered sensors. These digital sentinels can anticipate equipment failures, from flickering light bulbs to malfunctioning thermostats, before they disrupt guest comfort. By proactively scheduling maintenance, hotels can ensure seamless operations and eliminate the frustration of unexpected inconveniences.

Guest Sentiment Analysis: Using real-time sentiment analysis, you can learn more about guest satisfaction than ever before. This cuttingedge innovation is far more than just a star ranking system. It analyzes internet reviews, social media comments, and even in-room discussions to uncover areas for improvement and chances to surpass expectations, delving into the emotional undercurrents of guest feedback.

“ A JOYFUL, TRANSFORMATIVE NEW BATTLE IN GUEST SATISFACTION ”

Dynamic Pricing: Navigate the ever-changing tides of market demand with the agility of AI-powered pricing strategies. These algorithms analyze factors like competitor rates, seasonal trends, and real-time booking data to optimize room pricing in real-time. This dynamic approach maximizes revenue while ensuring competitive rates that attract guests.

Chatbots and Virtual Assistants: Chatbots and virtual assistants powered by AI may simplify mundane activities and provide round-the-clock visitor service. Freeing up human workers to focus on difficult queries and personalized encounters, these digital companions are always on the go and can answer frequently asked questions, handle room service orders, and even make local suggestions.

Instead of merely being a trend at Canadian hotels, the convergence of AI and data insights— plus a harmonious human-AI environment to live within—is a joyful, transformative new battle in guest satisfaction.

Canadian hotels could combine the speed and accuracy of AI with the empathy, emotional intelligence and discretion only humans can manage to make something perfect—a unique piece that not only satisfies guests but also guides them through economic uncertainty.

In this competitive ring where loyalty is always in short supply, AI and humans can work together as partners in a harmonious dance that guests won’t soon forget.

ABOUT HAPPYORNOT

HappyOrNot serves 4,000 brands, including healthcare organizations, Amazon, Google, airports and all sorts of retailers across 135 countries, and has collected and reported on over 1.5 billion feedback responses. The company provides AI tech that enables companies to identify and optimize customer and patient experiences through various touchpoints and in-moment feedback data.

18 SPRING 2024

CANADIAN HOTEL DYNASTIES

Who are they & what makes them tick?

Welcome to PART ONE of our STAY Magazine series about legacy hotel owners in Canada. Through this 2024 series, we bring you stories about fascinating people and celebrated hotels—some of the brightest, most textured bits of the rich fabric of our Canadian hotel industry history.

Compiled out of frank and fascinating interviews; from poring over archives and conversations with key personnel, we bring you these first two stories of two Canadian legacy hotel groups—Accent Inns and Gillin Hotels—and their people.

MANDY FARMER, PRESIDENT AND CEO OF ACCENT INNS, IS RENOWNED FOR HER BOLD, HIGHSPIRITED AND MARVELLOUSLY SUCCESSFUL LEADERSHIP STYLE AND COMMITMENT TO COMMUNITY VALUES…

Under Farmer’s guidance, British Columbia’s Accent Inns has grown from a regional familyowned business (started by Farmer’s father, Terry, in 1986) into a nationally recognized brand, celebrated for its unique blend of quality, service, and a flair for the unconventional. Her visionary approach has not only expanded the company’s footprint across British Columbia but also led to the creation of the Hotel Zed brand, a collection of eclectic, retro-inspired hotels that cater to travellers seeking a memorable experience.

Farmer’s contributions to the industry extend beyond her business achievements. She is a vocal advocate for sustainability, employee well-being, and community engagement, integrating these core values into every facet of her operations.

Her efforts have garnered numerous awards and accolades, solidifying her reputation as a trailblazer in the hospitality sector.

The Farmer family’s legacy in the Canadian hotel industry is a testament to their passion for hospitality and innovation. With Mandy Farmer at the helm, Accent Inns and Hotel Zed continue to set benchmarks for excellence, creativity, and social responsibility, making a lasting impact on the landscape of Canadian tourism.

We sat down to talk to Farmer about family, leadership, succession and why giving back drives just about every element of the Accent Inns’ business.

LEGACY OWNERS
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We’re going to continue to rebel against the ordinary and the status quo of our industry.”

Q&A

What does it mean to you to be a legacy owner within the pages of Canadian hotel history?

Being a family business means that the chapters of our company’s story are generational. As the “next generation,” I get to reflect on which parts of the business I need to preserve and which parts I need to reinvent.

When I became CEO, I was able to push the boundaries of hospitality’s rules and create a new brand within our company, Hotel Zed. At Zed, we’re rebels against the ordinary. Hot pink waterslide! Sex-positive Valentine’s Day campaigns! Hidden arcades! It’s totally the next evolution of Accent Inns.

When I was about 12 and my Dad started working in hotels, he was just so happy. He knew all the housekeepers by name. He loved reading all the

comment cards and making improvements. It was my Dad who decades ago introduced our iconic Accent Inns rubber ducks to the rooms. That was outrageous at the time!

My Dad set the tone for our company with his values, and when I took over I wanted to treasure and nurture them. The way we lead with love is our key differentiator and it started with him. I worked with our leadership to articulate what we were already doing right, define our values, and let them guide the business.

As a legacy hotel owner, how do you contribute to your community? What are some passion projects associated with your hotel(s)?

I care deeply about making our properties safe and happy spaces for our employees, guests and neighbours. I’ve always invested in employee happiness because I know if my staff can leave work with positive energy they bring that into their communities and homes.

We also invest in the happiness of pets. We have an annual HOWLidays campaign that we do in partnership with the BC Humane Society. We host puppy playdates at our locations around the province where the BC Humane Society brings in puppies in need of adoption. You can imagine the impact on staff and community morale when they can spend part of their day playing with puppies. We also donate a portion of our pet fee to the BC Humane Society year-round.

I’m also fiercely proud that we were the first hospitality chain in Canada to have every single location Rainbow Registered. Rainbow Registration is a national Canadian accreditation for 2SLGBTQI+-friendly businesses and organizations. Seeing the Rainbow Registered symbol tells people that our hotels meet a stringent set of standards to ensure 2SLGBTQI+ visitors feel safe, welcomed, and accepted.

How did you come to work in the business?

I never thought I would work for my Dad! I went to Montreal and got a degree in psychology. But I always spent my summers working at different hotels (never ours!) and definitely got bit by the hospitality bug. When I graduated, I began working for the family business as a salesperson and learned as much as I possibly could. That was

20 SPRING 2024
Mandy Farmer

actually 33 years ago this month! Safe to say, I fell in love with the company and the business, just like my Dad, and I’m proud to be CEO today.

What was the evolution of Accent Inns…not just over the years, but from one generation to the next?

My grandfather started a construction business that my dad and his partners eventually took over. Out of that business, my Dad built and opened our first hotel in the 80s and, even as a kid, I can remember noticing how much happier dad was when he started working on the hotel. He loved the hotel business. That hotel grew into five and was eventually rebranded to Accent Inns.

When I came on, I combined all of the learnings from our family business with my desire to always rebel against the ordinary to create our second hotel brand: Hotel Zed. It’s now grown to three properties! I’ve also launched our first foray into the food and beverage industry: ROAR, a livefire restaurant at Hotel Zed Tofino.

What are the core values that have led to your success and been maintained through the years?

We’ve maintained our core values since the inception of our company. While they weren’t written down, our core values were always the driving force behind how we did business. As we started to grow, we spent a lot of time talking to our employees and we articulated our four Core Values: Be Real, Have Fun, Make Everything Better and Have Each Other’s Backs.

How does your management style compare to your father’s?

My style has evolved from my Dad’s example. He always cared about his staff. He worked to make each hotel a happy workplace. He brought fun wherever he went. All of our core values that we have written down now always existed in our hotels because that was what he built. Now I am doubling down on his example. Now I am looking for the next outrageous thing we can do.

What is the longevity of your employees?

Wanna hear something awesome?! Forty-four per cent of our team have been here for over three years. Actually, we have many employees who have been with us for over 30! Our retention rate is 82 per cent which is almost double the average industry retention rate of 42 per cent.

I know these numbers because workaversaries are something we really celebrate in our organization. And not with a boring watch or “gift” that nobody wants. When you hit a milestone with us, your manager is given a budget to buy you a personal gift that you actually want! Because we’re celebrating the person, not the milestone.

What are your plans for the future?

Oh, yes. We’re going to continue to rebel against the ordinary and the status quo of our industry. This month, we launched our tenth Hotel Zed Nooner campaign for Valentine’s Day, and we’re really pushing the envelope with sex positivity. We’ll keep making sure our hotels are inclusive and rebellious, and maybe we’ll keep growing. Watch this space—big things are coming!

Are other family members/upcoming generations involved in the business?

My brother is a lawyer in the States, and isn’t interested in the family business which is fine! Right now, my kids are young and enjoying living their own lives. There’s no pressure for them to become hoteliers.

How has the business moved through the generations…and how was it valued as it “changed hands?”

It was purely voluntary! No family pacts. Shares in the company were frozen when I became CEO in 2008. My ownership equity was born solely out of growth.

There haven’t been a lot of transitions. I joined the ownership group, and the only other transaction was when we bought out one of our previous partners in 2021.

When I was brought on as a partner, a valuation was done based on the real estate and business operations. That value was frozen and remains with the previous partners. No value was handed down in that transaction, all my current value I have has been built since that day!

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THE ENDURING LEGACY OF THE GILLIN FAMILY’S COMMITMENT TO EXCELLENCE IN HOSPITALITY, DIPLOMACY & INDUSTRY

In the heart of Canada’s capital, amidst the ever-evolving tapestry of Ottawa’s cultural, political, and social landscape, stands the Lord Elgin Hotel—a testament to excellence in hospitality, diplomacy & Canadian industry. Its rich history, strategic milestones, and stories of visionary leadership have marked the hotel as a cornerstone of luxury and service in Ottawa.

I spoke with David Smythe, the long-serving general manager and director of operations at Gillin Hotels. Smythe has worked with the organization for over 25 years and he offers STAY Magazine an intimate perspective on the hotel’s journey under the Gillin family.

Constructed amidst the uncertainties of World War II in 1941, the Lord Elgin Hotel was named in honour of the 8th Earl of Elgin, symbolizing a bridge between Canada’s colonial past and its burgeoning national identity. From its inception, the hotel was envisioned as a grand space intended to mirror the aspirations of a young nation, fostered by the collaboration between visionaries like Ottawa businessman, alderman and later Board of Control member Chester Pickering and Prime Minister Mackenzie King.

The evolution of the Lord Elgin Hotel reflects both the development of Ottawa and the adaptive strategies of its management. From hosting dignitaries and celebrities to becoming a preferred venue for diplomatic conferences, the hotel has played an integral role in the nation’s capital.

ACQUISITION BY PATRICK GILLIN

Before owning the Lord Elgin Hotel, Patrick (Pat) Gillin founded Gillin Engineering and Construction in 1950. The company was involved in significant projects including the Gillin Building, a 12-storey office tower located at 141 Laurier Ave. W. in Ottawa, which opened in 1964. This building, known for its distinctive art deco-style architecture and a prime location near City Hall, reflects the company’s ability to create marquee properties in the capital’s downtown area.

By 1987, Gillin had become an Ottawa construction magnate known for his significant contributions to the city’s skyline, when he acquired the Lord Elgin Hotel. This marked the beginning of a new era for the hotel, bringing it under local ownership committed to enhancing its historic value and appeal. Gillin’s construction expertise and deep roots in the Ottawa community positioned him well to steward the hotel’s next phases of development and renovation.

MAJOR RENOVATION AND MODERNIZATION

Under Gillin’s ownership, the Lord Elgin Hotel underwent its most significant renovation and modernization project. This extensive refurbishment, carried out between 1988 and 1989, was aimed at updating the hotel’s interior to meet contemporary standards while retaining its classic elegance. The renovation, costing $11 million at the time, reduced the number of rooms from 360 to 312, allowing for more spacious and modern accommodations.

EXPANSION AND ENHANCEMENT

In the early 2000s, the Gillin family embarked on another ambitious project to expand and enhance the Lord Elgin Hotel further. This involved the addition of two eight-storey towers on the north and south sides of the original structure, completed over two years starting in 2001. This expansion effectively integrated new facilities with the historic core, increasing the

David Smythe, the longserving general manager and director of operations at Gillin Hotels Pat Gillin

room count back to 360 and adding modern amenities, including a new street-level restaurant (Grill Forty One) and a Starbucks coffee shop. The expansion was carefully designed to preserve the hotel’s architectural integrity, earning praise and recognition from Ottawa’s heritage community for its sensitive approach.

VISIONARY LEADERSHIP AND PLANNING

Just a month before his passing, Gillin was actively discussing an eight-year plan for the Lord Elgin Hotel, demonstrating his forwardthinking and dedication to the hotel’s growth. He envisioned extensive expansions and innovations for the hotel, highlighting his role as a “maverick,” “visionary,” and “mogul” in Ottawa’s business and construction scenes, says Smythe.

FAMILY SUCCESSION AND MANAGEMENT

After Gillin’s passing at the age of 84, the management and ownership of the hotel and related businesses smoothly transitioned to family

members already involved in the business—son Jeff was already looking after hotels, son Chris was managing capital projects related to the commercial division and their nephew was working in Kingston for the build of the Residence Inn by Marriott Waterfront at the time. This family-centric approach to business succession underscores the Gillin family’s commitment to maintaining their patriarch’s legacy.

In terms of operations, Smythe was appointed GM and director of operations of Gillin Hotels in 2004, where he remains today.

EMPLOYEE-CENTRIC LEADERSHIP

Pat Gillin is remembered for his big heart and an employee-centric approach. His philosophy of taking care of those committed to his company has been a hallmark of his leadership style. The tradition of giving every line associate a cash bonus at Christmas is a testament to his and the family’s appreciation for their employees, a practice that continues to distinguish the Lord Elgin Hotel from others.

COMMUNITY ENGAGEMENT AND SUPPORT

The Gillin family’s stewardship of the Lord Elgin Hotel has been characterized by a strong commitment to the community and the preservation of heritage over the decades. This is reflected in their ongoing involvement in philanthropic endeavours and their efforts to maintain the hotel as a living part of Ottawa’s history. The addition of historic artifacts and artworks, including loaned and gifted items associated with the hotel’s namesake and other historical figures, has enriched the cultural and historical ambiance of the hotel.

Between 1976 and 2008, Pat Gillin made significant donations to the University of New Brunswick (UNB), his alma mater, for numerous initiatives including scholarships for engineering students in financial need.

Gillin was awarded an honorary doctor of science degree from UNB in 1981 and the title of governor emeritus in 2001.

The Gillin family has maintained the M. Patrick Gillin Award in Engineering Scholarship awarded to deserving undergraduate students who have completed their high school education in New Brunswick, have demonstrated involvement in the community, have achieved a satisfactory academic record and require financial assistance. The Gillin family’s ethos extends beyond the hotel, engaging in a wide variety of community support activities. Most recently the Lord Elgin Hotel hosted an Indigenous dinner curated by Aboriginal chef Zach Keeshig to fundraise for the Wabano Centre, an outreach center for Indigenous people in Ottawa.

ADAPTATION AND PLANS FOR THE FUTURE

Gillin Hotels has faced much adversity over the years, but, like many hotel companies in Canada, the pandemic triggered an unprecedented period of difficulty for Gillin Hotels and its workforce. Smythe explains that finally, in 2024, the hotel is “back to normal” and once again thriving—full speed ahead.

The company’s resilience is exemplified by the lasting legacy and evolution of the Lord Elgin Hotel. The hotel is undergoing significant renovations and updates, signalling a new chapter in its storied history, with a focus on innovation and upscale amenities.

Following Pat Gillin’s death, his sons and other family members, as well as longtime employees and friends like Smythe have continued to oversee the Lord Elgin Hotel, ensuring that it remains a beloved and vibrant part of Ottawa’s urban fabric, their leadership has maintained the hotel’s reputation as a welcoming place for guests from around the world while honouring its rich history and architectural heritage.

The Lord Elgin Hotel, under the stewardship of the Gillin family, stands not just as a hospitality landmark but as a living legacy of vision, dedication, and an enduring commitment to the heart of Ottawa. The hotel carries with it the weight of history and the promise of continued excellence, embodying the true spirit of a legacy hotel in the heart of Canada’s capital.

24 SPRING 2024
STAYMAGAZINE.CA 25 Bayside Resort Parksville, BC Ascend Hotel Collection® is a membership of more than 370+ upscale, independent hotels open or under development worldwide, that benefit from increased exposure, reservation potential, technology, loyalty, and support from innovative global lodging leader, Choice Hotels®. Ascend members remain unique and distinct, able to operate and design on their own terms to prioritize the needs of their guests. ©2024 Choice Hotels Canada Inc. All Rights Reserved. Keep your local identity. Gain our global presence. Explore opportunities to stay local and go global. ChoiceHotelsDevelopment.ca For more information on how we can help, scan the QR code:

DISTINGUISHED WOMEN LEADERS

within the Canadian Hotel Sector

To commemorate International Women’s Day 2024, Choice Hotels Canada presents the remarkable journeys of four distinguished women leaders within the Canadian hotel sector. Their stories of resilience, innovation, and leadership illuminate the evolving landscape for women in business, hotels, and society— highlighting their significant contributions to the industry, their leadership insights and the challenges they’ve overcome.

GENEVIÈVE MILOT

Owner — Quality Suites Drummondville (2022 Choice Hotels Canada Hotel of the Year) & Quality Inn & Suites Lévis

Geneviève Milot, the owner of Quality Suites Drummondville & Quality Inn & Suites Lévis, is a third-generation hotelier whose passion for hospitality was ignited in her childhood. Milot’s journey in the hotel industry begins with an anecdote about her first shift where an accident involving spilling wine on a guest turned into a lesson in perseverance and belonging thanks to encouragement from a seasoned colleague. Raised in the environment of hotels, Milot’s formative years were spent absorbing the business through direct experiences and interactions with their family and hotel staff.

A key lesson learned over the years emphasizes the importance of valuing and consulting with the team, understanding that a well-cared-for staff creates a positive atmosphere that enhances guest experiences. This approach is coupled with a realistic attitude towards guest satisfaction, acknowledging that while striving to treat guests as kings, it’s also vital to recognize that not all dissatisfaction can be taken personally.

Milot acknowledges the evolving role of women in the hospitality industry, noting a significant increase in female representation in management roles and attributing this change to bringing a more human touch and better listening skills to the industry.

Challenges faced include the difficulties of being a young, female hotel owner in a male-dominated construction environment during the building of her hotel, highlighting issues of not being taken seriously and the rarity of her position at the time.

Milot draws inspiration from Oprah Winfrey, admired for her strength, determination, and positive influence on others, spanning across her talk show, network, and philanthropic efforts.

Her advice to future women in business: “Do not hesitate to take your place! Be bold, be curious and enjoy every day in the nicest industry there is! What a blessing to be welcoming people from around the world and showing them our beautiful establishments. Stand and shine, and if it disturbs people… offer them sunglasses but, always keep shining.”

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KAREN TAM

CFO, Choice Hotels Canada

Karen Tam’s path to Choice Hotels Canada was initiated by a fortuitous recruitment call while she held the position of CFO/COO in the financial services sector, prompted by her extensive background in the hospitality industry, which included stints in KPMG’s hospitality practice and pivotal roles at Four Seasons Hotels in corporate finance and investor relations. The timing was fortunate, coinciding with the retirement of Choice Hotels’ former CFO. Tam’s enduring passion for hospitality and the opportunity to return to the industry were decisive factors in her acceptance of the position. She focuses on operational finance and the corporate side of the business, overseeing legal, HR, ESG, procurement, IT and some commercial functions. All while striking a balance between the needs of franchisees and guests, and ensuring Choice Hotels Canada operates efficiently and effectively.

Throughout her career, Tam has gained valuable insights, particularly the importance of being prepared for unforeseen circumstances. Her experiences working at Four Seasons during the SARS outbreak and navigating the challenges brought on by COVID-19 shortly after joining

Choice Hotels Canada reinforced this lesson, having to immediately modify cashflows and labour requirements, in particular, while also trying to guide and assist franchisees during the worst time in the industry’s history. These experiences reinforced to her the importance of resilience in the face of the hospitality industry’s inherent volatility. Tam believes in the power of learning from both positive and negative experiences, emphasizing the value of treating people respectfully regardless of the situation.

When discussing the advancement of women in the industry, Tam acknowledges progress while highlighting the ongoing journey toward substantial change. She emphasizes resilience and tenacity as being crucial for overcoming challenges, especially in male-dominated fields, without compromising one’s integrity.

When asked who inspires her, Tam draws particular inspiration from her parents—a father who immigrated from Hong Kong and became a doctor, and a mother from Charlottetown, P.E.I., who was a nurse. Despite lacking business backgrounds, they instilled in her a strong work ethic and essential skills such as curiosity, critical thinking, relationship management, and compassion.

Tam emphasizes she is continually inspired by the remarkable individuals in her life, including colleagues, friends, and family, who embody intelligence, strength, kindness, and the importance of laughter! This includes the individuals she encounters in various roles within the hotels, from owners and general managers to those in front desk, housekeeping, and breakfast service roles, who excel in their positions with positivity, while managing life’s other demands. She feels extremely lucky to be surrounded by such incredible people and believes in the importance of seeking guidance and support from them when needed.

As a lifelong volunteer, Tam deeply values continuous learning and growth, asserting that discomfort often accompanies growth. She has lived abroad in Australia and Scotland, challenging herself by relocating to these countries without knowing anyone there. Additionally, she was a competitive ballroom and Latin dancer for many years, confronting discomfort and learning to manage stress while performing in front of judges and audiences.

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SHARON JOO

Owner, Comfort Inn & Suites Terrace, BC (2023 Choice Hotels Canada Hotel of the Year)

Sharon Joo’s professional journey commenced with her tenure as an Account Manager at RBC after graduating from Simon Fraser University, followed by a significant hiatus devoted to nurturing her two children. The trajectory of her career took a dramatic turn in the summer of 2018 when the family’s investment in the Comfort Inn & Suites Terrace faced the threat of receivership. With determination, Joo and her family relocated to Terrace on two weeks’ notice, embarking on a new venture. She rapidly acclimated to the diverse demands of hotel management, encompassing oversight of front desk operations, housekeeping, sales, accounts receivable and staff training, among other responsibilities.

One of the most valuable lessons Joo has absorbed in the business is the paramount importance of

Joo firmly believes in equal opportunities within the hospitality industry, asserting that success hinges on hard work, dedication, and perseverance.

cultivating and sustaining positive relationships and experiences with all stakeholders, including customers, employees, contractors, and delivery personnel. She strives to ensure that everyone receives the finest hospitality and support, aiming to leave a lasting, positive impression.

Joo firmly believes in equal opportunities within the hospitality industry, asserting that success hinges on hard work, dedication, and perseverance. She views the industry as a competitive field where survival depends on possessing traits that are highly valued in hospitality.

The journey has not been without its challenges, particularly in the face of the pandemic, labour shortages, and market shifts. Despite these hurdles, Joo takes pride in her ability to adapt, innovate, and most importantly, retain and support her staff through tumultuous times.

Inspiration for Joo comes from Kathleen King, the founder of Tate’s, a beloved cookie brand known for its crispy and buttery cookies. King’s journey from baking at her family’s farm stand at age 12 to overcoming adversity and establishing a nationally recognized brand exemplifies the focus, business acumen, and perseverance that Joo admires.

Joo’s advice to future women in business is to have confidence in their abilities and value. She highlights the hospitality industry’s accessibility for women, noting the long and unconventional hours but also pointing out the natural advantages women have, such as higher emotional intelligence and a knack for anticipating guests’ needs with a feminine touch.

28 SPRING 2024

NIMFA BAUTISTA

General Manager | Director of Sales (2021 Choice Hotels Canada Leader of the Year APEX Award Winner)

Halifax Tower Hotel & Conference Centre Comfort Hotel Bayer’s Lake (2020 Choice Hotels Canada Hotel of the Year)

Nimfa Bautista’s foray into the hospitality industry was marked by a cooperative training program in Human Resources at the Ramada Hotel Manila, Philippines, which she started before completing her AB Psychology degree. Transitioning to a Psychometrician role within the same hotel, Bautista’s fascination with the front office’s elegance led her to pivot toward guestfacing roles, igniting a lifelong passion. Her career trajectory saw her refining her craft at prestigious organizations and hotels like Millennium & Copthorne and Sofitel Philippine Plaza Manila, under the mentorship of a General Manager at Sofitel who helped her cultivate a profound passion for exceptional customer service. This journey of cross-departmental roles enriched her understanding of hotel operations.

Upon relocating to Nova Scotia, Bautista seized the opportunity to continue her passion in the hotel industry, starting at Comfort Hotel Bayer’s Lake as one of the first guest services associates and eventually ascending to General Manager. Today, she oversees sales and operations at both Comfort Hotel Bayer’s Lake and the Halifax Tower Hotel & Conference Centre, Ascend Hotel Collection, a testament to her dedication and the empowering influence of hotel owner Stephanie Giannoulis, who champions women in leadership roles.

For Bautista, the essence of her role in the hospitality industry lies in the profound value of outstanding customer service. She cherishes creating genuine connections with guests, aiming to transform each interaction into a warm, memorable experience that fosters loyalty and satisfaction.

Observing the hospitality landscape, Bautista notes a significant advancement in female leadership, attributing this to a cultural shift towards inclusivity and gender equality. This evolution not only acknowledges women’s invaluable contributions but also opens unprecedented opportunities for growth and leadership within the industry.

The challenges Bautista has navigated, especially during the COVID-19 pandemic, highlight the complexities of managing staffing transitions and maintaining service excellence amidst adversity. These experiences underscore the importance of a supportive work environment and strategies to retain and nurture talent.

Inspirational figures like Oprah Winfrey and Michelle Obama resonate with Bautista, who admires their empathy, empowerment, and advocacy, which have influenced a generation of women to pursue positive change in their communities and beyond.

Bautista’s advice to future women in business underscores the importance of passion, continuous growth, and valuing employees. She advocates for a company culture that embraces diversity, creativity, and innovation, principles she believes are essential for thriving in business and inspiring others to achieve their potential.

LEADING WOMEN OF THE FUTURE

As these women share insights into their personal journeys, the evolution of the hospitality industry for women, and the challenges they faced—their advice to future women in business is a testament to experience, boldness, resilience, and the joy of hospitality. Each leader, in her unique way, contributes to a more inclusive, dynamic, and compassionate hospitality industry.

The stories of Geneviève Milot, Karen Tam, Sharon Joo, and Nimfa Bautista serve as powerful reminders of the progress made and the path ahead for women in hospitality and beyond. Choice Hotels Canada is honoured to highlight these inspiring journeys, reaffirming its commitment to fostering diversity, empowerment, and excellence within the industry.

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Executive

GALLAGHER President

ED KHEDIGUIAN Senior

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& COO, Realstar Hospitality

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THE 2024 CANADIAN HOTEL INVESTMENT OUTLOOK

From interest rates to business travel to remarkable hotel sales, there are many important trends for the hotel industry to consider as we gather again for the Canadian Hotel Investment Conference. STAY Magazine has surveyed the top movers and shakers in the Canadian industry to get their insights. Here are their responses.

The Interviewees Real Estate Transactions and Valuations Leader, EY Canada
PENDLEY
Managing Partner, HVS
of Hospitality Analytics — Canada, CoStar Group
RUSSELL Director
BAXTER
and CEO, Hotel Association of Canada
and CEO, Tourism Industry Association of Canada
GRYNOL President
President
& CEO, Knightstone Capital Management
President
President, Development — Canada, IHG Hotels & Resorts
Vice-president, Operations, Germain Hotels
Vice President, CWB Franchise
GERMAIN Senior
Director, Colliers Hotels
Vice President and Practice Leader, Hospitality and Gaming, Valuation & Advisory, Cushman & Wakefield BRIAN FLOOD
FRASER MACDONALD Vice President, Sales & Distribution, Canada, Marriott International
Executive Officer, Choice Hotels Canada
LAURA PALLOTTA Chief
Principal, Canadian Hospitality Lead, Avison Young
BRIAN LEON
CURTIS
PresidentPrincipal Broker, CFO Capital
IRWIN PRINCE
MARK KAY
OCCHIUZZI STAYMAGAZINE.CA 31
SYLVIA

YEAR-OVER-YEAR CHANGES IN TRANSACTION ACTIVITY: WHAT ARE YOU SEEING?

We estimate that transaction volume was similar to 2022 levels, despite a decline in the number of transactions from 160 to 123. Average deal size increased to $13 million from $10 million in 2022 based on an increased number of larger assets trading.

We tracked over $1.72 billion of hotel transactions across the country in 2023, pacing ahead of 2022 levels ($1.63 billion) with some 90 per cent generated from deals for continued hotel use. While not a stand-out year for overall volume, it was encouraging to see hotel investor sentiment and investment levels remain resilient yearover-year given the higher interest rate environment. In addition to major players, we saw a number of new buyers eye the hotel space for investment, looking for cash flow and more attractive yields compared with primary CRE classes. Overall operational conditions are strong, and this should continue to support hotel investment activity in 2024.

Values are at all-time highs driven by increased revenues, despite the increase in interest rates and slower economy. Average sale price per room was $179,200 in 2023 vs. $136,500 in 2019.

Last year marked a new record for average price per room, which trended at $175,000 for the year based on acquisitions for ongoing hotel use. Looking beyond headline deals, both the limited and focused-service segments saw 15-20 per cent growth in average price-per-room metrics versus 2022. Based on deals closed so far in 2024 and those in the pipeline, we expect pricing trends to remain strong this year.

Thoughts on how these factors may change over the next 12-24 months and what could derail this?

We anticipate transaction activity to increase this year. Hotel performance results will continue to progress over the prior year but at a muted pace. As lender confidence improves and more participants enter the industry, the enhanced liquidity will bolster trades. Borrowers will be faced with higher interest rate quotes on new or maturing loans, but the general opinion is that rates have reached their peak and are likely to come down modestly in the next 12-18 months. All these factors will lead to reasonable transactions which is important for a healthy hotel investment market.

I think 2023 was the strongest year for the hotel industry ever. Everyone is optimistic, but I think there are a few things to keep in mind. People had hoped that we’d start seeing interest rates being lowered earlier this year, and obviously, they’re not and everyone is now anticipating later in the year. How that pans out is yet to be determined. When you hear everyone saying ‘2024 is going to be better than 2023, and 2025 is projected to be better than 2024,’ I get a little scared when everyone just sees up and ups. Because you do have these interest rates lasting longer than people anticipated. You’re seeing layoffs. You’re still going to see weakness in housing and commercial real estate markets. The hotel world has done incredibly well on growth of leisure, and I think you are starting to see cracks. You can’t keep charging leisure people forever, and corporate travel has not come back as fast as people had hoped to make up for the slowdown in leisure.

The outlook for the next 12 to 24 months is fairly optimistic. If interest rates remain high that will impact consumer spending and put pressure on the leisure travel segment, which has been remarkably resilient. After many months of restrictions people made it clear that travel is important. That said, the cost of travel has escalated to a point where many people may have to scale back. Given this trend, hotels are going to be shifting their focus to capture group travellers and the corporate segment. The expectation is that this will be a manageable shift, but if economic conditions go sharply negative that would put a damper on hotel performance and ultimately hotel values.

Existing hotel performance will continue to be strong because of the limited new supply environment versus the high cost of development that will continue to allow existing owners to drive rate. At some point, combined with rate cuts we will see increased new development activity. But material activity won’t happen until the tail end of the 12 to 24-month period in question, with supply impacts not taking effect until 36 to 48 months after that.

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INFLUENCING FACTORS TODAY. WHAT ARE THEY?

I would say interest rates and the impact on capitalization rates and expected rates of return for debt and equity in investment decisions. The cost of development outstrips values but drives values up given the inability to replace assets. Also, the limited new supply environment for the last several years, which is expected to continue in the near to medium turn, allows existing owners to continue to drive rate that outpaces the operating cost escalation. The last 10-15 years saw ownerships of hotel assets consolidate more than ever before, driving more sophisticated, nimble, and better capitalized owners.

Headwinds in Canada’s hotel development pipeline, such as high development and financing costs, are still in place, constraining the number of new-build hotels. This keeps replacement costs high, making investors even more focused on acquisitions as the most straightforward entry point. Even though demand to acquire hotels in Canada is high, opportunities to acquire have been limited over the past few years. Generational owners in Canada that typically deploy a long-term hold strategy also limit opportunities.

Coming off a record year for hotel performance in Canada, today’s hotel buyer remains focused on investing in markets with lasting strength and in properties where they can capitalize on operational upside. In circumstances where a property has been under-invested, hotel buyers are focused on the all-in acquisition costs, which include realistic estimates for PIPs and/or full repositioning scenarios.

There isn’t any distress in the market that is forcing owners to sell. There is some uncertainty about hotel performance following such a swift recovery from the pandemic lows. Our expectation is that growth will continue for hotels, but at a much more moderate pace than the market experienced in 2023.

Now that interest rate hikes are behind us, investors and buyers are starting to get comfortable with the overall cost of capital, and the bid/ask spread between buyers and sellers is narrowing. The outstanding operational performance of hotels is also attracting investors to a sector that perhaps never viewed hospitality as a desirable asset class. With investors and lenders souring on office, hospitality may benefit.

What asset classes or geographic markets are driving activity?

There has been an uptick in activity in some urban markets, particularly in the Ottawa, Montreal and Toronto markets, but demand is good in all markets. It’s really a question of availability. Most offerings continue to generate multiple bids, indicating a high level of interest from investors. Leisure-based resort markets continue to be very desirable to investors, including the Maritimes and the Rocky Mountain areas.

and Gaming, Valuation & Advisory, Cushman & Wakefield

34 SPRING 2024

I don’t think there’s any real trend. Buyers are typically more active in the major cities, but there haven’t been a lot of properties come to market in the downtown core of the country’s major cities.

Resort offerings continue to attract significant interest from investors. Whether it’s the Fairmont Hot Springs and Rimrock Resort, or the Hazelton Hotel, unique hotels in iconic Canadian locations will always attract interest from investors because they are irreplaceable assets. Limited-service hotels have really impressed hotel owners. They present a more affordable travel option when the cost of travel has grown so exponentially. They were also the best-performing segment during the pandemic. In the past, some hotel investors would shy away from limited-service product because of lower barriers to entry and difficulties distinguishing between brands. But, now, hotel investors view them as a stable and safe part of any hospitality portfolio.

The pandemic fuelled a fundamental shift in the industry, pushing us to be less reliant on business travel and more on either necessitybased or leisure travel. The strong recovery is really concentrated in Canada’s major markets, which account for more than 42 per cent of all hotel rooms across the country. Major cities like Vancouver are really catching the attention of hoteliers around the world; this is a market that needs more hotel product. For the first time in years, we’re starting to see many developers advance plans to add more hotels in hot markets like Vancouver.

Canada’s largest metro markets (+1M population) accounted for close to 50 per cent of volume in 2023, including downtown and suburban submarkets. Primary downtown core acquisition opportunities are quick to pique investor interest. However, these assets are generally bought to hold and are rarely put on the market. Major resort markets such as Banff and Muskoka drove the lion’s share of resort activity, hovering just under 25 per cent of national volume. Over the long term, trading in secondary and tertiary markets has driven the bulk of Canadian hotel investment activity, generally accounting for some 60 per cent or more of hotels trading in any given year.

Transaction volume was split fairly evenly across the country in 2023, with eastern Canada slightly outpacing the western provinces’ volume by about 10 per cent. Ontario, which typically drives half of national hotel volume, slowed to a third of overall volume while Quebec, British Columbia and Alberta saw double-digit growth year-over-year.

Resorts performed well operationally throughout the pandemic and therefore attracted attention from investors. Given the rebound in operating performance in urban markets over the past couple of years, combined with limited transactions recently, there could be more urban trades this year.

STAYMAGAZINE.CA 35

WHAT WAS THE MOST COMPELLING SALE IN THE LAST 12 MONTHS AND WHY?

I would say the Hazelton Hotel Toronto. The sale demonstrated the depth of the Canadian market for trophy assets, setting a new price per room ceiling. From a portfolio perspective, InnVest Hotel’s acquisition of the Morguard hotel portfolio in early 2024 is another hallmark transaction that really solidifies hotels as institutional quality assets.

The Morguard sale of 14 assets to InnVest Hotels and Manga Hotels was the largest and most compelling sale in the past 12 months. The portfolio was made up primarily of focused service hotels in the GTA together with the Marriott Toronto Airport and the Prince George and Cambridge Suites in Halifax. The purchase filled some voids in the InnVest and Manga portfolios and added assets to their existing management portfolios.

Oxford Properties' acquisition of the Rimrock Resort in Banff was a compelling purchase. Because it is institutional money that is being invested in a resort market with a significant capital investment to follow it shows the underlying strength and desirability of both the hotel industry and the Canadian market. Other significant transactions for the year were in Toronto with the sale of the Hazelton Hotel and in Montreal with the InterContinental Hotel. The GEC Suites trade in Vancouver was the first trade in that market in several years, and there have been a variety of transactions in secondary and tertiary markets.

What does today’s buyer look like. Who’s investing and why?

The majority of buyers continue to be private purchasers, either individually or as part of small investor groups. Hotels have demonstrated that they’re an excellent hedge against inflation and provide opportunities for value-added growth to experienced, hands-on investors.

Many significant trades over the past few years were focused on resorts in Canada. At the end of 2023, BlackRock’s $300 million loan to Freed Corp. was announced, solidifying private equity interest and belief in Canadian resort upside. As a part of the deal, Freed acquired the remaining 29 per cent of its resort portfolio from Skyline Investments. It was also announced that the loan provides growth capital for Freed to develop and renovate the portfolio of resorts in Ontario, including Deerhurst, Horseshoe, Muskoka Bay, and Blue Mountain development lands.

Over the past couple of years, while interest rates have been elevated, the sector has cemented its reputation as a strong hedge against inflation, which has piqued interest from real estate investors who have historically considered hotels to be too risky and volatile. ADR growth exceeding inflationary growth highlighted that dynamic nightly pricing allows hotel operations to react to inflation quicker than other property types that only have this opportunity yearly at most. When coupled with the underperformance of other property types, there has been a shift in investment capital toward hotels.

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LENDING AND FINANCING

How are borrowers adjusting financing terms?

I think the real question is, what are people doing with refinancing? Us personally, we’re looking for shorterterm length of refinancing. Typically, we would refinance for five years plus. Now we’re looking at extending our terms by anywhere from 12 to 18 months or maybe 24 months. We do think interest rates are going to come down. I do think there’s an opportunity for some assets to take on a little more debt, especially if they have to do renovations, PIPS, and things like that. There is incremental value that has been built up in a lot of assets.

WHAT ARE SOME OF THE FACTORS THAT LENDERS LOOK AT THAT ASSESS LOANS AND AMOUNTS?

In this environment, some people are even more scared in regards to the type of asset they’re lending to, and who they’re lending to. So, it’s even more important to be urban, good brand, have good management, and be experienced.

On the heels of a strong hotel transaction market in 2023, we continue to witness positive sector investment sentiment for both acquisition and new construction opportunities in 2024. Despite some headwinds, confidence in the hotel asset class was evidenced by a diverse investor pool including new entrants eyeing hotels for their strong cash flow. Debt liquidity from a broad cross-section of regional, national and international lenders has been one of the primary drivers of investment activity.

The DSCR (Debt Service Coverage Ratio) is one of the most important financial tests for a hotel. The lender DSCR expectations range from 1.2 to 1.5. If the DSCR is higher, the stronger the hotel performance and ability to service the debt.

Acquisitions: LTP (Loan to Purchase) for acquisitions has reached as high as 80 per cent! The highest we have ever seen.

Construction/Rebranding: LTC (Loan to Cost) for construction is up to 75 per cent provided the completion valuation is equal to or greater than the total construction budget and the projected cash flow meet the required DSCR.

We have seen a surge in non-hoteliers developing hotels for two reasons:

Condo/apartment developers: For the developers to achieve maximum density for their urban projects, the municipalities are insisting on mixeduse zoning which includes office and/or hotel. Developers acknowledge they are not familiar with the hotel space and will either arrange 3rd party management, joint venture partner or sell the hotel-condo. With all the mixed-use office and residential space that is coming to market, developers and municipalities are working together to rezone the office to hotel due to higher demand in the hotel space.

Entrepreneurs: Existing successful businesses (non-hotel) want to enter the hotel market for portfolio diversification. These new investors/ hoteliers will participate in both acquisitions and construction. Due to a lack of supply in the market, there is a surge of new entrants entering the construction space.

STAYMAGAZINE.CA 37

WHAT FACTORS ARE INFLUENCING THE LENDING ENVIRONMENT?

One of the interesting things is the big deal that BMO and I think HSBC financed with Morguard. They put a lot of money up. Does that reduce the amount of liquidity in the market? Because you only have so many hotel lenders to begin with. Did that take the liquidity out of two of the lenders, and probably the biggest one, BMO? Or are they going to use that as a growth platform to expand their hotel lending?

What are the major demand segments, and how do these differ for urban and suburban, primary and secondary, and resort and conventional hotels?

What hotel asset classes are most successful coming out of COVID?

What type of guests are they attracting and why?

Pent-up domestic leisure demand has driven growth across all asset classes. Full-service and upscale hotels specifically have experienced the largest year-over-year growth postCOVID, (over 15 per cent increase in 2023), as travellers are gravitating towards full amenities and more tailored experiences. Domestic leisure travellers surpassed 2019 levels by the end of last year, while international visitors are still only at 80 per cent. We are being outspent by our international competitors in both tourism destination and business events marketing. Studies show that 70 per cent of travellers are seeking sustainable travel options and 42 per cent are willing to spend more for it. We’re helping more hotels unlock that potential through the expansion of our Green Key Global certification program, which provides properties with the third-party credibility they need to market their green commitments.

For urban and suburban hotels, business travel used to be a significant segment, complemented by leisure travellers. These hotels also cater to conventions and business events. In contrast, resort and conventional hotels primarily attract leisure travellers looking for relaxation or recreational activities, with a particular emphasis on family or wellness vacations. The distinction between these segments has evolved, with a notable increase in ‘bleisure’ travel. This trend has blurred the lines between traditional demand segments.

HOW DOES THIS DIFFER FROM PRE-PANDEMIC MARKETS?

Since the pandemic, there’s been a shift towards domestic and leisure travel, with a slower recovery in business travel. The booking cycle for business events usually begins at least four years out from a particular event, which is why we are not anticipating the sector to recover for several more years. Health and safety concerns, the rise of remote work, and the efficiency of virtual meetings have transformed traveller priorities, leading to a surge in demand for destinations that offer outdoor and nature-based experiences, benefiting resort and rural locations.

38 SPRING 2024

AFTER TWO BOOMING YEARS IN LEISURE TRAVEL, WHAT WILL THE SUMMER AND FALL OF '24 LOOK LIKE?

City-wide convention activity is doing quite well. Is this sustainable?

Canadians continue to prioritize travel and we expect a strong summer season in 2024. We are also hoping to see our international visitation numbers grow as these visitors spend more and stay longer. They will also serve as a counterweight to any possible slowdowns in domestic travel due to rising costs and household debt. The biggest concern for this summer is our members’ ability to staff up for those lucrative summer months.

Why is business travel slow to recover and what will truly kick-start it?

A kick-start to business travel will likely require a multifaceted approach, including highlighting the benefits and necessity for in-person interactions to foster relationships and collaborations that virtual meetings cannot replicate. We are starting to see this return. While it’s challenging to predict if business travel will return to pre-pandemic levels, a gradual recovery is anticipated, potentially taking several years as companies reassess their travel policies and priorities.

Although booking data shows we are on track for a healthy recovery, we are seeing shorter booking windows, which means we haven’t regained the predictability we had pre-COVID. Consideration of Canada is especially high from U.S. companies, but we have room to grow on overseas business events.

WHAT ARE THE HOTEL ASSOCIATION OF CANADA'S KEY ADVOCACY PRIORITIES?

Over 62 per cent of HAC members identify access to affordable housing as a barrier to attracting and retaining employees. We were proud to lead a lobbying effort in the fall that resulted in a commitment from the federal government to reign in short-term rentals through the establishment of a new fund to help provinces and cities enforce regulations that limit commercial operators, or ghost hotels. This effort will see tens of thousands of units returned to the long-term housing market. More hoteliers are considering the development of mixeduse hotel and housing projects. HAC has taken on a new initiative to get mixed use projects included in CMHC and GST rebate housing incentive programs. Hoteliers continue to focus on labour challenges by increasing wages and benefits, offering more flexibility, and investing in innovative tech solutions, but shortages continue. Last year the Association’s advocacy work opened up 110,000 new positions for the sector through various immigration channels. We continue to build on this momentum in 2024, focusing on mobilizing these new Canadians into available hotel jobs. We hope to share good news on this initiative soon.

STAYMAGAZINE.CA 39

What is in your development pipeline?

Marriott continues to expand its leisure offerings and has recently introduced Moxy Hotels to the Canadian market. The first new build in the country, Moxy Halifax Downtown opened in January 2024 and will soon be followed by Moxy Banff, a $30 million conversion of The Voyager Inn, later this spring. This year, we look forward to expanding our Marriott Bonvoy portfolio of hotels in Canada with the openings of Courtyard Montreal Laval, Courtyard Regina Downtown, Fairfield Inn & Suites Newmarket, Four Points by Sheraton Sarnia, AC Hotel by Marriott Ottawa and Moxy Hotel Montreal, among others.

As leisure demand continues to rise, particularly in destinations such as Metro Vancouver, the Okanagan Valley, Vancouver Island, the Canadian Rockies, Muskoka and the Niagara Region, lifestyle brands are driving market share. Weekend occupancy has grown across Marriott’s portfolio of hotels in Canada compared to 2019, and Marriott continues to lean into brands that help address the demand for blended trip purposes.

Following the pandemic, we were happy to resume and complete our project at Calgary University District. The other project we had put on pause during the pandemic was the one at Ottawa Airport Terminal (opening summer of 2025). Our main focus on the development side is to increase our presence in the Greater Montreal Region, Greater Toronto Region and British Columbia, where we have yet to open our first hotel.

Over the past few years, we have had a surge in dual brand projects. We have also seen a trend in owners of Holiday Inn Express properties taking advantage of excess land on their sites and developing either standalone extended concepts or adding to the existing hotel under either the Candlewood Suites or Staybridge Suites brands. Beyond dual branding, extended stay rooms continue to be a theme for new deals. In 2023, we executed new construction Holiday Inn agreements in the B.C. interior, the Greater Toronto area and suburban Ottawa. We also signed and opened a fully renovated Crowne Plaza property in Saint John, NB and are in advanced negotiations on more Crowne Plaza hotels, both new construction and conversion, across Canada. We will continue our focus on the midscale segment through prototypical new construction projects under the avid hotels brand and conversions with the newly launched Garner midscale brand, which will be on sale in Canada very soon.

WHAT ARE OWNERS LOOKING FOR WITH A BRAND?

Owners invest with us because they trust our brands, our ability to drive returns and the strength of our entire enterprise. In turn, we leverage our scale to help our owners run more efficient businesses. We are focused on enhancing every aspect of the hotel lifecycle, while also working with owners to identify ways to reduce costs to build, open and operate hotels. This includes programs designed to reduce supply chain, labour and operational costs, such as an F&B procurement initiative that offers more competitive food and beverage pricing for nearly 4,100 participating Americas hotels. We also have lowered costs to build through more efficient design prototypes, namely across our Holiday Inn, EVEN Hotels and extended stay brands including Atwell Suites, Candlewood Suites and Staybridge Suites.

& Resorts

40 SPRING 2024

How are you currently balancing equity growth with management and brand renovation objectives?

IHG continues to work with owners to update the look, feel and facilities of our hotels and resorts. Our tracking shows that owners see significant increases in guest satisfaction scores and RevPAR following renovation. General availability and cost of capital concerns remain, but we are seeing more owners find ways to reinvest back into their properties and get their renovations completed. We were very thoughtful during the pandemic and the transition out by allowing owners to delay the start or completion of a renovation. We now expect owners to move ahead with delayed renovations.

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TELL US ABOUT YOUR ORGANIZATION'S OUTLOOK FOR THE NEXT SIX MONTHS

I think we’re heading into a period where we have a convergence of more positive factors supporting hotel development than we’ve had in many years, all happening simultaneously. With pandemic-era supply chain issues largely behind us, we’re seeing stabilization in construction costs.

Hotel operating fundamentals, with record levels of RevPAR, have become much stronger. From a development standpoint, we’re in the midst of a period of a very favourable relationship between continued growth in room demand and limited expansion of supply, with the ripple effect from the pandemic supply disruption still working its way through the cycle.

While construction costs for new build hotels are stabilizing at levels well in excess of pre-pandemic levels, the overall viability of those projects is supported by stronger than ever hotel revenue trends. We’re seeing feasibility studies for new hotels that are significantly higher than they would have been a few years ago.

Added to that, there is strong interest from potential hotel investors seeking to either get started in hotel investing or in expanding their portfolios, as well as a more receptive debt market with financing terms getting progressively more favourable.

This indicates a lot of positive tailwinds that bode well for hotel development. With all that happening, we’re very optimistic that we have some great development opportunities in the years ahead.

We’re confident in the industry’s continuing growth. We fully expect to see increases in both ADR and occupancy this year. Although the growth rates might not exhibit the same level of dramatic increase seen in the past couple of years, the positive upward trajectory of both is a promising sign. Balancing guest expectations, increased costs of operation and capital expenditures has never been more challenging and important. Our team is laser-focused, working with our owners and managers to effectively balance all three, to maximize results in each metric.

Realstar Hospitality continues to focus on strategic growth across the country, adding hotels to the Days Inn, Motel 6 and Studio 6 that are positive fits for each brand. We are keen to work with owners as they recognize the benefits of joining a brand with strong consumer awareness and outstanding made-in-Canada support. Whether re-positioning from another brand or from being an independent, the benefits of joining a strong franchise company are compelling. With an increasing roster of conversion and new construction hotels on the horizon, the Days Inn, Motel 6 and Studio 6 brands continue on a path of robust and accelerated development in 2024.

Travel demand remains healthy and we’re optimistic for the year ahead. Our outlook is focused on one word—growth. IHG remains confident in the strength of our business model, scale and strategic priorities to capture profitable growth. With more than 6,200 global hotels spanning 19 brands globally, IHG has a fuller, more robust brand portfolio than ever. That includes powerhouse mainstream brands like Holiday Inn Express to well-performing extended stay/ suites brands such as Staybridge Suites, to strong premium brands like Crowne Plaza and upper luxury brands such as Six Senses.

WHAT DOES TODAY'S BUYER LOOK LIKE? WHO'S INVESTING AND WHY?

Investors that typically focus on other commercial real estate sectors such as retail, office or industrial have shown interest in hotel real estate, especially as operating fundamentals strengthen, and cap rates appear attractive compared to these other sectors. Well-capitalized groups with commercial development experience and who are looking to diversify their portfolio are considering hotels since the opportunity to acquire existing properties remains limited. Conversely, hotel owners are expanding their real estate portfolios and diversifying into complementary sectors such as student accommodation and senior housing.

42 SPRING 2024
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DEFINING & UNDERSTANDING THE ROLE OF THE HOTEL ASSET MANAGER

The deal is done, the purchase of a new hotel has happened and the congratulatory message from the broker, financing company and hotel owner celebrating the accomplishment has been sent out—now what?

If the new owner was an institutional investor or one that owns multiple properties in Canada, it is likely that a hotel asset manager was involved in this project and will now be responsible for representing the owners’ interests. So, what does an asset manager do and who are they?

ROLE OF ASSET MANAGER

A hotel asset manager bridges the worlds of hotel operation/management with that of real estate management. They typically represent the interests of the owner and are responsible for the

enhancement of the hotel’s value. The role of the asset manager came about in the 1980s and 90s with the separation of ownership, management functions and the increase in lodging franchises, and third-party and brand managers. In the 1980s institutional investors, insurance companies and banks frequently found themselves with troubled loans. The way out from the troubled loans was to have people with industry-specific expertise help them.

Compared to other real estate asset classes like commercial or office, hotels are complex operating businesses that manage a new tenant with every room rental rather than a monthly rent cheque for a tenant based five- or ten-year lease. With shifts in tourism demand, labour cost controls, complex hotel management contracts and ongoing capital expenditures, the ownership of hotels requires operational expertise to enhance the value of the hotel. This professional discipline has become known as hotel asset management. As a profession, industry representation and education began with the Hospitality Asset Managers Association (HAMA) in the 1990s.

Today, HAMA represents about 200 asset managers overseeing an estimated 3,200 hotels with 760,000 rooms. They are primarily a United States based membership with affiliates now in Europe, China, and Middle East & Africa. As a much smaller economic market, Canada does not have a local chapter of HAMA nor do we have an official list of asset managers. Within Canada, asset managers are often employed by large hotel ownership groups like InnVest Hotels, Barney River Investments and SilverBirch Hotels & Resorts or for large institutional investors like Oxford Properties.

ASSET MANAGEMENT
44 SPRING 2024

At InnVest for example, James Wolfe, vice president of asset management, moved into an asset management role with InnVest after being a hotel general manager. With a comprehensive hotel background, Wolfe sees the key drivers in asset management as being the liaison with the owners and someone who can sort through many different priorities. However, the most intangible and valuable benefit for owners is the ability for the asset manager to work collaboratively using best practices and financial information to improve the overall hotel revenue, guest experience, hotel valuation and employee experience.

The time and responsibilities of the asset manager vary depending upon the hotel investment cycle and owner. This question of where asset managers spend their time has been answered by HAMA research. The association conducted a survey of their members in 2015 to understand the profile and functions of asset managers. The survey highlights that a primary function of the hotel asset manager is constant performance measurement.

Source: A Current Profile of the Hotel Asset Management Profession; Robert Kline and A.J. Singh with Hospitality Asset Managers Association ASSET
DISTRIBUTION % of responses that ranked Most Time Spent as 1-3 Monitor the financial performance Revenue management Advise ownership on investment strategies Contracts Loan compliance Capital expenditures Operational reviews Advise ownership on management issues Monitor investment community Franchise affiliations 81% 58% 55% 52% 38% 35% 15% 9% 5% 2% STAYMAGAZINE.CA 45 EXPERIENCE .... the difference Hotel - Apartment - Long Term Care Renovations and New Builds www.bayconconstruction.ca 416-578-9997 | 403-483-6968
MANAGERS TIME

ASSET MANAGER PROFILE

As a professional discipline, hotel asset management has only been around for about 30 years. The role is so new that only seven per cent of HAMA members have more than 20 years’ experience. While there are many professional designations relevant to operating hotels such as Controllers (Certified Public Accountant), Professional Engineer (Building Management) or Gold Seal (Chef’s), there is not one that recognizes the unique knowledge and skills for hotel asset management. Some designations and education that are commonly found to be a part of an asset manager’s profile include:

• Hotel valuation firms: Many asset managers have a valuation background with firms like HVS, Cushman & Wakefield, CBRE, Colliers, JLL and others. In order to sign off on an appraisal they are required to be certified by the Appraisal Institute of Canada which is most commonly backed up with education from UBC’s Postgraduate Certificate in Real Property Valuation.

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• Cornell University: Recognizing the unique nature of Hotel Asset Management, eCornell offers certificates in Hotel Real Estate Investments and Asset Management. This certificate is available online and offers a good overall background into understanding the motivations of the owners, operators and lenders.

• Undergraduate degree: The most common university education that is found amongst asset managers is a Bachelor of Commerce. Within a hospitality context in Canada many have a background from the University of Guelph or Toronto Metropolitan University (TMU) hospitality degree programs. Recognizing this niche industry, TMU started a Hospitality Asset Management course almost ten years ago. That course has now transformed into a Hotel Real Estate Management course for both Hospitality and Real Estate Management students.

From an overall background perspective, asset managers in Canada tend to come from two profiles; hotel operations and real estate advisory. For those from a hotel operations background

they will have worked at the property level and have a strong background in understanding of revenue management or financials for hotel properties. With investment skills being one of the most important for an asset manager, many have worked through the ranks of hotel valuation consulting before transitioning to an asset manager.

HOTEL ASSET MANAGEMENT FUTURE

The future need for asset managers in Canada will be strong. As more hotel investors adopt thirdparty management agreements, they will need the specialist advisory that comes with the hotel asset managers. For family-owned hotel operations who add new hotels to their portfolios, there will be a time that they will need the specialist knowledge and professional expertise that is beyond their organization’s original expertise. As a community, hotel owners in Canada need to think about this specialist role and either nurture the professional development of existing hotel managers or develop undergraduate students through cooperative education programs.

As more hotel investors adopt thirdparty management agreements, they will need the specialist advisory that comes with the hotel asset managers.”

ABOUT THE AUTHOR

Dr. Chris Gibbs is an associate professor at the Ted Rogers School of Management at TMU where he teaches a course in Hotel Real Estate Management. He is a proud alumnus of TMU’s School of Hospitality and Tourism Management and has a certificate in Hotel Real Estate Investments and Asset Management from Cornell University. His 20+ years of diverse experiences prior to teaching at university, help him bring a 360-degree view of hospitality, tourism and entertainment industries to students.

STAYMAGAZINE.CA 47

REVOLUTIONIZING EXTENDED-STAY HOSPITALITY

Hybrid work and the blending of leisure and business travel have generated strong demand for longer hotel stays, increasing the popularity of cost-effective extended-stay hotels.

This segment is now one of the fastest growing in hospitality and last year, Hyatt announced its entry into the category with the Hyatt Studios brand.

To serve Hyatt guests on more stay occasions and introduce new guests to the portfolio, the Hyatt Studios brand is rapidly growing with significant interest from the development community. Hyatt has approximately 200 deals in various stages of negotiation, including executed deals representing approximately 2,000 pipeline rooms across North America. This also includes both single-unit developers and multi-unit developers.

One of those executed deals includes plans to build the first Hyatt Studios hotel in Canada. In collaboration with Sigma Group and Midroc Holdings, a Hyatt Studios hotel in Mississauga, Ont. is expected to open in 2026.

Sigma and Midroc Holdings have a track record of making history with Hyatt and previously were the first to bring the Hyatt Place brand to Ontario with the development of Hyatt Place Toronto/ Mississauga Centre.

“Our decision to expand our long-term relationship with Hyatt was easy and propelled by the strong return on investment we’ve seen from working with Hyatt and the team’s commitment to understanding the needs of guests, customers and owners,” said Arjun Jasuja, Chairman, Sigma Group. “Care is at the heart of everything Hyatt does and is reflected in how Hyatt has developed the Hyatt Studios brand in collaboration with owners. We’re transforming the upper-midscale extended-stay experience together.”

48 SPRING 2024 SPONSORED CONTENT

The launch of the Hyatt Studios brand will stand as a testament to the Mississauga market’s potential. With its robust economic landscape and strategic location just 30 minutes from downtown Toronto, Mississauga presents an ideal canvas for innovative hospitality concepts. The Hyatt Studios brand, with its blend of convenience and comfort, is primed to resonate with both transient and long-term guests visiting the city.

″We’re proud to be the first to bring a Hyatt Studios hotel to the Canadian market,” said Javaid Akhtar, CEO, Midroc Holdings. “This project epitomizes our dedication to guest-centric design, setting new standards for extended-stay hospitality. With plans for additional hotels underway, we look forward to growing with Hyatt and delivering exceptional experiences to guests across Canada.”

The Hyatt Studios brand, which was conceived in direct collaboration with hotel developers and by listening to the needs of target guests, offers developers three main components: efficient design with a focus on minimizing construction costs, an operating model designed to be lean, streamline operations, and generate outsized

returns, and flexible brand and design elements that can be tailored to guest profiles and local market needs.

Committed to catering to the evolving demands of diverse markets across primary, secondary and tertiary markets, each hotel will represent an approximate 122-room prototype meticulously crafted to accommodate both extended-stay and transient guests, with the versatility to scale. The brand’s flexibility enables developers to tailor each hotel’s design and programming to meet the unique needs of various markets, whether by incorporating leisure amenities like a pool or catering to group business with meeting space.

Guests staying at Hyatt Studios hotels can expect simple necessities that make everyday living and travelling more comfortable. Guestrooms will exude the warmth and functionality of a studio apartment, providing a dedicated space for work, relaxation, and dining. Setting itself apart with innovative self-service amenities, highlighted by a state-of-the-art grab-and-go marketplace, the brand prioritizes guest convenience while empowering owners to achieve robust operating margins. Each hotel will deliver must-have extended-stay features, including laundry and fitness areas, complimentary Wi-Fi, outdoor spaces, and pet-friendly accommodations.

As Hyatt’s first upper-midscale brand in the Americas, Hyatt Studios fills a crucial niche in the extended-stay category, catering to the high-end guest within its segment. With a focus on collaboration and market insight, the Hyatt Studios brand can serve as a catalyst for growth. On average in markets where there are Hyatt hotels, there are four Hyatt hotels whereas Hyatt’s largest competitors average 14 hotels, meaning fertile territory for developers who don’t want to worry about intra-brand competition.

“Backed by Hyatt’s global resources, renowned quality of care, and the industry’s fastestgrowing loyalty program, World of Hyatt, the Hyatt Studios brand promises to elevate the traditional extended-stay experience, becoming the preferred brand for discerning guests,” said Chrissy Dizon, Director of Development, Hyatt, Canada. “With its commitment to simplicity, comfort, and convenience, the Hyatt Studios brand heralds a new era of hospitality, setting the stage for memorable stays in Mississauga and beyond.”

As Hyatt’s first upper-midscale brand in the Americas, Hyatt Studios fills a crucial niche in the extended-stay category, catering to the high-end guest within its segment.”

chrissy.dizon@hyatt.com

(312) 785-3253
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THE BALANCING ACT

The symbiotic relationship between hotel asset management and revenue optimization

In a recent conversation I had with an asset manager who was underwriting a hotel in the metro Atlanta area, it was determined that for each incremental 50k of profit achieved, the hotel asset value went up approximately 600k. Imagine if your revenue team fully understood this.

Hotel asset management and revenue optimization are two critical components of a successful hotel operation, each playing a unique role yet deeply intertwined in maximizing profitability and ensuring the long-term viability of the property. This symbiotic relationship can be likened to a delicate balancing act, where strategic decisions in one area can significantly impact the other.

A good portion of my work involves helping revenue teams build topline revenue strategies and utilize tools to better analyze overall strategy from a total hotel perspective. One thing that continues to surprise me is the fact that revenue

REVENUE MANAGEMENT
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Hotel asset management and revenue optimization are two critical components of a successful hotel operation.”

teams do not always understand their owners’ investment objectives and what their short or long-term objectives are.

Conversely, when collaborating with asset managers, I notice a tendency for them to step into revenue meetings without fully grasping their market context and then influence strategy decisions that may hinder the overall success of their asset performance.

That being said, as the cost of operating and financing a hotel asset continues to escalate, there is more and more emphasis on ensuring that revenue performance is at its peak. Additionally, it’s no longer good enough to say this hotel is performing well from a topline standpoint. Profit has to be on the minds of the entire executive team across all revenue centres.

As we view this unique relationship between owner representatives and revenue leaders, let’s explore why there are still silos today, discover ways to overcome the communication gaps, and better understand how the two groups can take advantage of the strengths each brings to the table to fully optimize the asset value.

WHAT ASSET MANAGEMENT/OWNERS WISH REVENUE OPTIMIZATION TEAMS KNEW ABOUT UNLOCKING A HOTEL’S VALUE

Ensuring your revenue teams understand the investment objectives is really important and allows your team to better gain perspective on what they are trying to collectively achieve with the owners.

Having worked at the property level for many years and even when I worked for management

“ STAYMAGAZINE.CA 51
The key objective behind all of this, of course, is to determine if there is enough unlocked value to ensure a successful acquisition and provide sustained ROI.”

companies at the above property level, I often found myself in the dark regarding the owner’s objective for their assets. It was sometimes the best-kept secret, and we were left guessing. When I moved over to the hotel asset management side, I found myself working with revenue teams to help them gain perspective on why we acquired the asset to begin with, and what we were trying to achieve.

Asset managers will tell you a lot goes into underwriting a new asset. Besides evaluating the overall asset value, owners need to demonstrate to bankers, insurance companies, and investors that the loan risk is not too great and whether the overall deal is a wise investment. This involves looking at parking, retail space, under-utilized space, optimal mix of business, optimal mix of rooms, the appropriate number of keys, rooms to meeting space ratios, expected capex required, determination of brand affiliation or operating as an independent, management companies, management teams, and more. The key objective behind all of this, of course, is to determine if there is enough unlocked value to ensure a successful acquisition and provide sustained ROI.

Investment cycles also play into enterprise goals and objectives. In general, while shortterm investments focus on immediate operational needs and revenue generation, long-term investments emphasize sustainability, growth, and value creation over an extended period. Balancing these short-term and long-term considerations is essential for maximizing returns and ensuring the success of hotel investments. From a revenue generation perspective, if the investment is shortterm strategies will focus more on generating

cash by using the means necessary to obtain a customer base and taking advantage of the peaks and valleys in the marketplace. Conversely, over the long term, hotels may implement strategies to diversify revenue streams, such as investing in conference facilities, spas, or restaurants to stabilize income beyond room bookings.

Finally, asset managers would like revenue teams to focus on all revenue streams in a hotel. Hotel revenue optimization has traditionally focused solely on room revenue, but in today’s competitive landscape, it’s essential to consider revenue from various sources beyond just room bookings. By optimizing these revenue streams, hotels can significantly boost their overall profitability. Revenue optimization strategies that consider multiple revenue streams rely on sophisticated data analysis and forecasting techniques. By leveraging data analytics, hotels can gain valuable insights into guest behaviour, market trends, and pricing dynamics, enabling them to make informed decisions to maximize revenue across all channels.

A HOTEL REVENUE OPTIMIZATION TEAM’S WISH LIST FROM ASSET MANAGERS

In order for revenue teams to be successful in their role, there are some crucial tools, resources, and practices necessary to ensure your team is effective in developing unrealized revenue potential.

• Investment in Technology: Among all the resources required would be cutting-edge revenue management systems and tools. This could include advanced analytics platforms, dynamic pricing software, and, of course, an integrated property management system.

• Investment in People: It goes without saying that in today’s ever-changing environments, continuous training and development programs are essential for revenue optimization teams to stay updated on industry trends, new technologies, and best practices.

52 SPRING 2024

• Access to Data and Integration: Asset managers can support revenue teams by facilitating data integration across different systems (e.g., property management system (PMS), channel managers, customer relationship management (CRM) platforms) and ensuring access to relevant market data and benchmarks.

• Employ Advanced Data Analytics Discipline: Enabling hotel management companies and teams to employ advanced analytics to help solve problems and provide insights will help forecast demand and optimize rooms, banquet, and F&B outlets and better understand customer habits and overall value. Often times finding this unique talent and the tools necessary to employ this is difficult and requires expertise from your management company or a third party to build and maintain.

• Cross-Functional Collaboration: Asset management can help facilitate and support cross-functional initiatives that are focused on

Our Promise to Developers:

Spirit Ridge, Osoyoos, Canada The Unbound Collection by Hyatt Park Hyatt Toronto, Canada
| JdV by
The Walper Hotel, Kitchener, Canada Hyatt Hyatt Centric Ville-Marie Montréal Quebec, Canada
individualized
hyatt.com/development
When you choose to work with Hyatt, you get more than just a development partner. You get an
growth strategy, a global business network, 60+ years of experience and high value guests to fuel your vision.

driving revenue growth and improving guest satisfaction. Today various operational departments often work independently from each other and are not aware of the cause and effect of strategies on other departments. The greater the alignment of goals, the greater the communication among departments, which ultimately leads to greater opportunities for profitability.

• Incentive Structure Alignment: Today’s KPIs need to go beyond revenue objectives. Aligning incentive frameworks with KPIs related to asset investment objectives can inspire revenue teams to meet revenue and profit targets, thereby fostering performance enhancements. Asset managers should advocate for incentive schemes that recognize both individual and collective successes in revenue generation and profitability.

• Provide Flexibility and Autonomy: In today’s ever-changing environment, enabling your revenue generation teams with the ability to shift gears when necessary as well as experiment with the strategies and tactics is crucial for innovation and performance improvement.

THE BOTTOM LINE

Successful asset management firms and owners excel in addressing intricate challenges to uncover untapped profit by aligning themselves with appropriate resources and personnel. They are effective at communicating goals and objectives and involve key stakeholders in setting up strategies. They support them by providing the right technology, education, and resources necessary to solve these tough issues and grant them the autonomy needed to adapt and thrive in areas with growth opportunities.

By taking the time to equip, educate, and communicate the overall objectives from an asset optimization standpoint, the more in sync and tied the teams will be in helping boost the overall objectives of the property.

With more than three decades of experience in the hospitality industry, Timothy Wiersma is recognized as a leader in revenue management and commercial strategy. His company specializes in property and portfolio revenue management, business analytics, distressed-asset turnaround, and asset assessment.

Before Revenue Generation, Wiersma was head of revenue management with Canadian Hotel Income Properties (now Silverbirch Hotels). He was also vice president of revenue management with Host Hotels and Resorts. Other positions held were vice president position at TPG Hospitality, a private equity firm with over 60 full-service hotels, and vice president of Red Roof Group where he oversaw the Revenue Strategy of over 650 economy hotels.

Wiersma is an active board member and past president of HSMAI (Hospitality Sales and Marketing Association International). He is also teaching the HSMAI Revenue Optimization Essentials course on a regular basis. In his spare time, time enjoys spending time outdoors, gardening and flying small aircraft. revenuegenerationllc.com

ABOUT THE AUTHOR
54 SPRING 2024

RENOVATION EXCELLENCE, EVERY STEP OF THE WAY

Sarvin Construction is a privately owned construction and procurement company with over 10 years of experience. We have completed rooms between 250 to 300 guestrooms in a record 4 to 6 months timeline. In Sourcing , we can manufacture custom furnitures , custom lighting, vinyl planks, chandeliers, plumbing fixtures, tiles, granite/quartz/Marble slabs, door fixtures and So on. As there are no middle men, we can guarantee affordable pricing with BEST QUALITY for commercial quality products.

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INTERIOR DESIGN TRENDS FOR HOTELS

The renowned 2024 Interior Design Show celebrated its 25th year in January. The show highlights the best in Canadian design annually, giving attendees a sneak peek into coming trends and providing industry insiders with valuable insights. STAY Magazine was there— following are some of the show highlights and trends in communal and adaptive interior spaces.

ACOUSTIC WALL ART

When it comes to innovation in interior spaces, acoustic panels have come a long way. Acoustic panels absorb sound, improving an interior’s acoustics. A key trend at the Interior Design Show this year was wall art with noise-dampening capability. The following companies have found a way to design wall panels with aesthetic appeal coupled with sound-dampening practicality— ideal for hotel interiors.

The Marie Dooley collection of textile wall art and murals are vibrant artworks that have been designed to embellish interior spaces. Each shape of the design is cut, sewn and assembled by hand in their Quebec workshop and signed by the artist. In its acoustic version, each panel is lined with high-performance 1 1/2” acoustic wool which offers an NRC index of 0.85, to reduce

noise pollution and help make the environment a peaceful place.

Quiet Earth Moss walls use natural materials and plants with a leading acoustic backing material to dampen noise. They are a solution for architects and interior designers looking for design solutions inspired by nature, using green walls, and plants to increase human connectivity with the natural world. The organically preserved natural moss brings custom green spaces indoors.

PURPOSE-LED AND LOCAL DESIGN

Some standout vendors at the show focused on highlighting the people behind the products that bring meaning and connection to interior spaces. Cue textural-heavy and handcrafted vendors, such as Obakki—a purpose-led lifestyle brand

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56 SPRING 2024

that connects people through modern design. Everything curated by Obakki is handcrafted and produced in partnership with its network of artisans—real people making products that bring meaning and connection to an interior space.

Obakki had an impressive booth with a larger-than-life rope sculpture wall hanging. The company is a purpose-led lifestyle brand that connects people through modern design. They offer handcrafted wares ranging from scented candles to furnishings that are produced in partnership with a network of world-class artisans. Sustainable, ethically handmade décor made by artisans from around the world. They place importance on respecting the creativity and technique of every artisan and aim to give communities a stronger sense of cultural independence and pride.

Another standout booth was Pi Fine Art, with over four decades of experience crafting custom artworks, wallcoverings and alternative wall decor. They offer expertise in art consultancy and the precision of fine art craftsmanship tailored to suit the distinct needs of every hospitality project. When it comes to hospitality trends, one of the themes they are highlighting is introspection, celebrating the restorative power of calm environments. The theme encourages guests to slow down and press pause on their busy lives to appreciate the environment they’re in.

Soffi Studio is a Canadian company that creates sculptural blown glass installations and contemporary decorative accessories. They work with interior designers and art consultants from around the world; providing original design solutions for commercial, hospitality and residential projects.

ACCESSIBILITY IN INTERIOR DESIGN

The Canadian National Institute of the Blind (CNIB) presented a panel hosted by the president of CNIB’s Access Labs, David Demers, on how to seamlessly integrate accessibility into the design of built environments. Access Labs is a social enterprise dedicated to supporting businesses, organizations, and government institutions to ensure all Canadians with disabilities can benefit from barrier-free communities and workplaces.

A key takeaway from this session was that integrating accessibility in digital and physical environments during the design process is critical and saves time and money over remediating after the fact. According to the Royal National Institute of Blind People: “When you design for anyone you design for everyone” and improving experiences for everyone means improving a business’s bottom line.

There is a projected increase in the population of differently-abled people, which means a growing market. Building codes are considered the baseline standard but companies should look beyond the basic codes when it comes to accessibility to truly be inclusive. One way to accomplish this is to ensure accessibility is not an afterthought. Clearing our Path is a set of recommended guidelines that bridges the gap between building code standards and inclusive design by incorporating best practices and consulting with differently-abled people. The manual contains information on design basics, and interior and exterior design elements, and is considered a valuable resource for architects and designers, providing insights for them on design elements that are crucial for accessibility.

Demers also mentioned Accessibility Standards Canada as a valuable resource for research into accessibility standards that are recognized as the National Standards of Canada.

For differently-abled people, using textures and sounds to orient is one key to good design. When it comes to acoustics, designers need to consider the dampening vs echo impact of their designs to avoid creating disorientating environments.

Demers mentioned some common mistakes when designing accessible spaces. He cited hotels as an example of often designing with mood lighting in mind that isn’t practical for

COURTESY OF PI FINE ART COURTESY OF ACE HOTEL TORONTO
STAYMAGAZINE.CA 57
COURTESY OF QUIET EARTH MOSS

those with visual impairments. Examples of this are recessed lighting, low-hanging pod lights in eating areas, and lights going from bright to dark repetitively in hallways which creates light and dark zones that can be challenging for a visually impaired person to navigate.

Hotel touchscreens are another opportunity to enhance accessibility as they often have accessibility buttons on the touchscreen and are not created with the user in mind. Elevators with braille and embossed letters and numbers in high-contrast colours are optimal, as not every visually impaired person can read braille. Elevators also need to vocalize which floors to get on and off at and ideally have mirrored interiors which allows people in wheelchairs to be able to see behind them when they reach their desired floor. Accessible spaces include clearly defined paths of travel using either tactile elements or contrasting colours or textures. Guide dogs tend to follow lines, so using carpeting as a pathway can be a helpful strategy.

Overall, Demers advises designers to consider the entirety of a visitor’s journey. Consider a comprehensive approach starting at your business’s website, considering the transit to the building, and the path through that building to the lobby and elevators.

The quote by renowned architect Chris Downey “Nothing for us without us” takes into consideration the incorporation of diverse lived experi-

IMAGES COURTESY OF PI FINE ART
For differently-abled people, using textures and sounds to orient is one key to good design. When it comes to acoustics designers need to consider the dampening vs echo impact of their designs to avoid creating disorientating environments.” 58 SPRING 2024

ences. Social participation, which includes travel and tourism, requires a basic level of accessibility. A key message of this seminar was that accessibility can be a part of the design and can also be beautiful.

CO-CREATION—THE NEXT LEVEL OF COLLABORATION

Robert Cooper, CEO of Alterra, and Brigitte Shim, Canadian architect and founding partner of Shim Sutcliffe gave a seminar on the future of collaboration, using the ACE Hotel in Toronto as a case study. The discussion centred on the potential of symbiotic collaboration between architects, designers, and developers, and how it can shape a compelling vision for tomorrow using the lessons derived from the ACE Hotel, an exemplary project that showcases the power of collaboration. From its custom-designed lighting and furniture that reflect the hotel’s unique character to the meticulous process behind the building’s design, the ACE Hotel collaboration is a real-world example used to inspire and propel sustainable and collaborative industry forward. interiordesignshow.com.

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