RED ROOF INN this month launched an extended-stay brand, HomeTowne Studios, stepping into a growing sector of the hotel industry. The phased launch of the brand will include $50 million in renovations of more than 30 properties with 4,000 rooms in around 20 markets. Red Roof Inn plans to open another dozen HomeTowne Studios properties over the next 12 months.
Citing data from Lodging Econometrics that show extended-stay projects make up more than a quarter of developments in the U.S. pipeline, Red Roof said the sector’s recent growth over the past few years motivated the development of the brand.
“The extended stay category continues to grow as consumer preferences continue to evolve,” Red Roof President Andrew Alexander said. “The launch of HomeTowne Studios by Red Roof is a natural progression, and key milestone, as we extend our portfolio for a range of guests.”
Red Roof expects franchisees to embrace the brand because it positions them to invest in a growing segment, said Chief Development Officer Phil Hugh. “This new sub-brand will create additional brand awareness, giving our franchisees access to a new customer base while still benefitting from the strong brand equity, attributes, benefits and proven support system of Red Roof.”
HomeTowne Studios suites will feature standard extended-stay amenities, such as kitchenettes with full-size refrigerators, microwaves, sinks and kitchen tables. Other features include high-speed Wi-Fi, flat screen HD TVs, on-site laundry and free U.S. phone service. Guests also will have the option to purchase a kitchen kit that includes dishes and silverware, and they will be eligible to participate in Red Roof’s RediCard loyalty program.
Extended-stay properties generally attract travelers in project-based industries, such as construction and health care. Families of patients at nearby medical facilities and relocating professionals are other key demographics for the model.
According to the brand’s franchise disclosure document, the cost to convert a 65-room hotel into a HomeTowne Studio by Red Roof ranges from $215,700 to $1 million. Application fee is $5,000, and initial fee is $30,000. Royalty fee is 3 percent of gross room revenue; marketing and reservation fee is also 3 percent.