STARWOOD CAPITAL GROUP opened its first midscale extended-stay brand, Uptown Suites, in April with plans to open 10 more in the next two years.
With the opening of Uptown Suites in Concord, North Carolina, and Smyrna, Tennessee, in May, Starwood Capital is adding to what some experts say is a significant pipeline of supply in the U.S. extended-stay sector.
All major hotel companies each have one or more extended-stay brands that collectively span across the chain-scale segments. Midscale to upscale brands saw the most development in the fourth quarter of 2016, reports the Highland Group in its annual extended-stay report. The segments saw three times as much development as their economy level counterparts.
For 2o16, upscale extended-stay outpaced its lesser peers in new construction, adding more than 12,300 rooms, the “greatest we have ever reported,” said the report.
Not to be outdone, midscale supply grew by 12,000 rooms, the largest net gain since 1998; and the economy segment added more than 2,000 rooms, the “largest gain from new construction alone in six years.”
Within this framework enters Uptown Suites, a midscale brand launched by Starwood Capital several years after its acquisition of then-troubled InTown Suites. The private equity investor poured money into reviving InTown Suites through renovations of its 188 hotels in 22 states, totaling more than 24,000 rooms. The properties are privately owned although Starwood Capital has hinted at developing a franchising platform in the future.
InTown Suites are strictly economy priced, and, while Starwood Capital touts Uptown as an economy brand, rates at its two hotels average around $90 a night and $430 a week.
Starwood Capital plans to open 10 more Uptown Suites by 2019 in such markets as Denver/Centennial, Colorado, Miami/Homestead, Florida; and Austin, Texas.
It is primarily a new-construction brand although an existing InTown Suites in Newport News, Virginia, is being repositioned as the higher-priced peer. Starwood Capital says Uptown Suites’ target markets are near cities and in smaller markets that have strong job and population growth.