DALLAS—Elevate, the theme of the 2017 La Quinta Conference, held here at Hilton Anatole, dominated the discourse throughout the first day of the event.
President/CEO Keith Cline elaborated on that theme in the general session. “Elevate means to raise or lift up to a higher position, and that is certainly our goal,” he said, noting that the company has had three strategic priorities: driving consistency of product, driving consistency in the delivery of guest experience and driving engagement with the brand.
“All of these priorities are designed to drive revenue. We’re transforming our brand in a very intentional way,” Cline said.
With regard to consistency of product, Cline noted, “2016 was a year of significant investment in La Quinta. We invested in our people, in our hotels and in laying the foundation for the future of the brand… Late last year, we began our investment to reposition approximately 50 company-owned hotels. They will be repositioned upwards within their respective markets to drive enhanced revenue.” Cline added that company-owned assets would follow one of three paths: they’ve undergone or are undergoing renovation to be properly positioned; they have the opportunity to be part of the second wave of incremental renovations; or they aren’t properly positioned and the company should open the market up for potential future development.
“Since we launched this strategy about a year ago, on the owned side of our business, we sold 19 hotels, and about 50 are undergoing significant reinvestment. As part of driving consistency for the brand, we also removed 25 franchise hotels in 2016. In addition, over 100 franchise hotels have either undergone or begun renovation,” Cline said. “By the close of 2017, just this first strategy will have meaningfully impacted almost 20% of our brand by either removing the hotels or significantly improving the hotel.”
Cline pointed to the company’s property in Clifton, NJ, which completed its renovation in November 2016; in the subsequent three months, net promoter scores almost doubled, RevPAR was up 14% and market share was up almost 1,000 basis points against the comp set.
The renovations being done help align existing Inn & Suites properties with the company’s Del Sol prototype. Areas of focus include the exterior, great room concept, fitness room and guestrooms. At the franchising session, the brand noted it expects these enhancements to be in place by Dec. 31, 2018, but it will work with franchisees who recently opened a hotel or went through a renovation.
John Cantele, EVP/COO, added, “This isn’t only about renovating our hotels; to varying degrees, our plan is to elevate every one of our hotels at some level.” For instance, the brand is introducing LQ Up, which, among other things, will enhance breakfast offerings and introduce a focus on coffee offerings, with a dedicated serving area featuring higher quality brews.
Cantele added that La Quinta is also looking at how to improve the Inn properties. “They represent a significant contribution to our fees and our earnings. We’re exploring a plan to elevate the Inns as well. It would ideally include a significant capital investment of a yet to be determined amount, and the investment will take place over time, but it has to happen,” he said. “As we further develop our plan, we’ll share more at the appropriate time.”