EDMONDS, WA—With a trio of new-build projects in the offing and a number of other signed deals in the development pipeline, as well as a number of renovations within existing properties, The Hotel Group’s portfolio continues to evolve.
Doug Dreher, president and CEO, The Hotel Group (THG), based here, expressed enthusiasm about the owner/operator’s unprecedented flurry of activity. “Right now, we have the most robust pipeline on business development in our 30-plus-year history, so that’s real exciting,” he said, adding, “We’re also busy on all fronts.”
The company has some 27 properties currently open and operating, six of which are company owned, while the rest are third-party managed. THG—which maintains a strong management presence in the Northwest—operates full-service and select-service hotels within many of the major brands, such as Hilton, Marriott, IHG, Choice Hotels International, Wyndham Hotel Group and Accor.
THG is poised to add some 10 properties in total when you factor in the three new-construction hotels, six pipeline projects and a potential acquisition of a “Midwest airport property,” according to Dreher. In terms of markets, Dreher noted the company tends to lean toward secondary markets. However, when it comes to the pending properties, they are more evenly split between downtown urban markets, secondary areas and tertiary locations. Of the six projects in the pipeline covering such states as Hawaii, Alaska, Oregon and Washington, Dreher estimated that roughly half will break ground this year.
All three of the company’s new-builds are in Washington. A SpringHill Suites by Marriott in Kennawick is under construction and scheduled to open in May. Linked to the convention center, it will represent THG’s third property in the market. The company operates a Hilton Garden Inn across the street and a Courtyard by Marriott as well.
Meanwhile, in Seattle, the company has a 222-room Hilton Garden Inn under construction, which is slated to open in June. “It’s right in the heart of downtown, pretty close to a lot of activity. It’s a really hot market and very diversified,” said Dreher, adding it will represent the only Hilton Garden Inn in downtown Seattle.
Lastly, slated for completion this summer is the Homewood Suites by Hilton in Issaquah. The 122-suite, eight-story hotel will be owned by Rowley Properties, Inc. and managed by THG. The company already has a Hilton Garden Inn in the market, which Dreher described as a bedroom community to Seattle and Bellevue. He noted that having both properties will give THG some “economies of scale and synergies.”
Dreher noted a number of renovation projects are keeping the company’s project team busy. THG is nearing completion of a lobby renovation on the Holiday Inn Express in Pullman, WA, and is in phase two of a renovation for its Hilton in Brentwood, TN. He added, “We have a lot of CapEx going on as well.”
Dreher maintained that, when it comes to overall portfolio growth, “40 is a comfortable number to reach within the next few years.” However, he added that the company continues to emphasize quality over quantity, in addition to selecting the right deals. “The most important thing is aligning with the right client. Of those that are under construction or in the pipeline, some are with existing clients where they’re doing more than one, and that’s always encouraging, and some are new clients,” he said. HB