The impact of high inflation and a recessionary environment is not as severe in the lifestyle space as it may be in other segments. The majority of the lifestyle segment and leisure guests tend to weather these periods of economic uncertainty quite well.

We are also in such multi-variable environment now – in certain markets ADRs have grown upwards of 30% from 2019, therefore offsetting increasing operating costs. Pent up demand after two long years of suppressed travel under the pandemic is overcoming air traffic challenges (prices, delays), and there are longer lengths of stay as travelers are working remotely – and these factors are helping margins. We believe this recovery momentum from people returning to travel may well take through to the other side of the current market conditions, as maintaining rates help hotel recover faster.

Our latest data shows ~1.6% US market growth in the next two years. First, we see a shift in what is being built: a “commodity-type” hotel is not as attractive on a P&L and there’s an abundance in supply in most markets. Second, we see many developers turning away from those big box brands and looking to reposition with lifestyle brands to maximize returns. Third, developers are more willing to combine hotel assets with other uses, such as branded residences, extended stay concepts, co-working spaces and searching for ways to differentiate their property.

Ennismore is an integrated lifestyle collective with Carte Blanched F&B division, AIME Design Studio, Partnership Studio, and the largest portfolio of hotel brands exclusively in the lifestyle space, which is benefiting from this shift in demand in our industry. We are well positioned to take advantage of the market preference and expect to see our portfolio grow exponentially in the next two to three years.

We see strong demand for clearly differentiated product and specifically, lifestyle hotels. When a brand can connect with guests on a cerebral level, it builds a strong following and lasting loyalty. The unique experiences guests take away from their stay result in the best direct marketing for the hotels.

We bring hotels to life with their own personality and energy. Whether it is Hyde Beach Club at SLS South Beach or the Hoxton Chicago as a central hub and melting pot for the neighborhood, a lifestyle hotel takes focus and vision to create. Ennismore has been built around the challenge of being able to create these unique, founder-built, 14 lifestyle brands and grow them with scale without losing what the brand set out to deliver. About 45% of our company is focused on building and creating content (through design, restaurant & nightlife/entertainment concepts, digital marketing, and partnerships), while collaborating with Accor’s global infrastructure for sales, distribution, and IT.

We define a lifestyle hotel as a multi-faceted offering that can anchor a neighborhood as a destination in itself; can bring in locals and travelers; that has design elements that create its own personality and identity; create authentic experiences; and has restaurants and bars that actually make people want to stay there.

With the right activation to create a highly profitable hotel – programming which maximize revenue generating space, F&B concepts which drive room nights and higher ADR index, creative design which incorporate local culture, lifestyle hotels are one of the most compelling in the industry. These offerings become attractive for both developers and guest alike. Also, lifestyle hotels have also experienced the benefit of bleisure travel (blending of business and leisure) as consumer expectations and behaviors have profoundly shifted. Ultimately, developers have come to realize lifestyle hotels maximize revenue resulting strong industry leading ROI.

I suspect the industry will struggle with the labor shortage for the next few years as we will need to work hard to compete and attract talent from other industries. It is encouraging that people are going back to work and encouraging to see a new equilibrium with people working remotely from home or wherever they chose to be.

There are many variables why someone chooses where to work – attractive comps/benefits, a safe and inclusive work environment, providing job satisfaction and upward mobility, (the list goes on) – it’s not enough to get just one or two of those right. Our perspective is that you need to make a place where people enjoy working, are inspired by the product and engage in a strong corporate culture while allowing their individual personality shine.

It’s all connected. The labor shortage contributes to the supply chain issues, all the way from production to delivery and installation. Contractors and subcontractors, being short staffed has been a challenge, and even in some cases backlogs in local government organizations have caused delays in getting permits.

We have seen this affect hotel developments anywhere from 6 to 12 months but may be seeing that delay coming back down and stabilizing. This makes projects take longer and stresses developers’ balance sheets in the process. Getting a strong and motivated project team and the right consultants on board can really help speed the process up. Working with a global company brings with it global solutions … if you can’t get your furniture from one supplier, having a global network of suppliers in place can really help.

Travelers have too many choices and developers are always trying to keep up with shifting preferences and trends. Today’s travelers are all looking for brands they can identify with or experience a local culture. Developers can see many of the big brands have oversaturated most markets and diluting brands to keep growing. They are mired in their own exclusivity areas. There are city centers out there with literally more than 100 hotels from the same group. It can be hard to get excited about a world class distribution system when you share it with 100 neighboring hotels.

I have to pick two: The first is F&B. F&B is traditionally included as an amenity to define hotel chain scale, and generally is an afterthought in most hotels. Ennismore views F&B as transformative – it can define a property, can provide outsized ADRs, and increase total revenue generated when done right. F&B is as important as the hotel rooms themselves, yet we often see amazing properties completely miss this. When you bring in the right expertise, understanding of the business model and creative minds together, you can see significant benefits.

The second point is the online, digital footprint. Ninety-one percent of guests 35 and under book hotel stays through online channels. These travelers make up 46% total hotel stays and will account for a larger portion of the traveling pie in the future. Meeting those customers in that space and delivering interactive experience is becoming more critical. Ennismore as a dedicated digital studio focused on the booking experience to creating synergies with our external brand partners, we want to build an online ecosystem that meets consumers’ expectations.