NYC’s Only Red Roof Owner Bringing First Super 8 To Big Apple; Ramada Also On Tap

DALLAS— Vijay Dandapani, whose New York-based Apple Core Hotels owns Manhattan’s only Red Roof Inn, is making a quick trip of Accor Lodging North America’s 2002 convention going on here at the Hyatt Regency Reunion. On Saturday, March 16, Dandapani will be back in the Big Apple to raise the flag on another first, the city’s first Super 8. Apple Core is reflagging of the group’s 206-room Quality Hotel and Suites on 46th St., where it completed major renovations, including guestrooms and the lobby, toward the end of last year. “It’s the antithesis of the boutique movement, which is what we do technically,” Dandapani told HOTEL BUSINESS®, referencing Apple Core’s strategy of acquiring and repositioning tired and/or undervalued properties. “And the market being what it is, I think, is highly receptive to a budget, value-oriented hotel, which is what the property is. Every room is brand new.” Another “really dynamic reason” for making the switch, said the COO, centers on the Cendant brand’s base of loyal customers. “Super 8 has the second largest affinity card holders [base]for any hotel company in America,” he stated. The property, which will be known as the Super 8 Hotel-Times Square, had been a Choice Hotels International brand since 1997, but after the severe occupancy and rate drops in New York following the terrorist attacks on Sept. 11, Dandapani said the group started rethinking the property’s positioning. “People are being almost forced— that’s a strong word— to not stay in a name-brand hotel, owing to the sense they’re being told they’re profligate, they’re spending too much —particularly in business. People want to stay in a place that essentially has all of the amenities we do offer, but at the same time, it doesn’t have a boutique-y, chichi connotation. More than anything else it’s the fact that Super 8 is price sensitive, but we also offer value for that price.” Apple Core’s portfolio has seen steadied occupancies, “still in the low 90s,” said Dandapani, with the Quality Hotel & Suites doing 87% in February. The group’s other thus-far unique Manhattan property, the Red Roof Inn in Midtown, posted 92% occupancy for that month. “Being the only Super 8 would get us up there in occupancy, and it will also give us tremendous name recognition. Being the only one is better than being one of a handful of such product and that was our inclination. And Sept. 11 certainly made the decision for us.” He expects to get a rack rate in $120 range, which he doesn’t expect will give loyal Super 8ers sticker shock, given the Manhattan market. He said his Red Roof Inn, also considered a “roadside brand,” has proven to be “the most resilient of our products that we have in our portfolio. Inelastic, almost, in terms of demand. So I don’t think there’ll be a price problem with Super 8. People will realize this is not Podunk. It’s just Manhattan and prices are going to be different.” Nonetheless, he added, the property will still represent value for someone who would have to pay far more in a boutique or another national chain. “We’ve already seen bookings coming in and the rates are pretty good,” he said The property is set to have its grand opening April 11. A week later on April 17, Apple Core also will reflag its 100-room Quality Hotel Eastside on Lexington Ave. and 30th St. as the Ramada Inn-Eastside. Ramada is also a Cendant brand, and one of several in the city. Dandapani said the reflag deals were done separately. He also indicated Apple Core is not shifting away from Choice product and still maintains a Comfort Inn in the city as well as a 181-room Quality Hotel & Conference Center in Hempstead, Long Island that it converted from a Best Western in June 2001. “I really hope to do other Choice products, but right now there’s nothing on my plate,” he said.