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Moving Into New Territory

Homewood Suites Begins To Execute On Expansion Strategy in Latin America

Tuesday, March 06, 2018
Miss Kerry Medina
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After launching the brand's expansion strategy for Latin America in May 2015, Homewood Suites by Hilton unveiled its first new-build property for the region. The Homewood Suites by Hilton Silao Airport officially opened in Mexico in November, a showpiece for the Latin America prototype that will inform certain aspects of the design at the additional eight properties in Homewood's Latin America pipeline.

Additional new construction is set for Monterrey, San Miguel de Allende, Saltillo and Tijuana, for a total of six locations across Mexico, including the Silao hotel and a 97-room Queretaro property that converted to Homewood in 2016. Also to come are two properties in the Dominican Republic-one in each Punta Cana and Santo Domingo-as well a property in Lima, Peru and San Jose, Costa Rica.

"We'd like to build another 65 Homewood Suites in Latin America, but those properties won't survive without the breadth and critical mass of Hilton products that are already there," noted Adrian Kurre, global head of Homewood Suites and Home2 Suites by Hilton.

In fact, Homewood's Latin America agenda is a hub in the spoke of Hilton Worldwide's expansion efforts in the region. In 2017, Hilton signed approximately 30 new deals in Latin America and opened 15 new hotels, spread across Belize, Brazil, Colombia, the Dominican Republic, Mexico and Uruguay. Today, the Hilton portfolio totals 130 properties in Latin America and the Caribbean, with approximately 80 more in the pipeline.

According to Juan Corvinos, Homewood's vice president, development, Latin America and the Caribbean, each of Hilton's 13 brands meet various market demands, depending on the market where it's located. In Homewood's case, the brand offered a solution to extended stay travelers who were previously making a habit of staying at Hampton Inn and Hilton Garden Inn hotels while in Latin America. Introducing Homewood to the region provided these guests with "a product that is intended specifically for their type of stay," he said.

Corvinos also believes the region is ripe with development opportunities for Homewood, noting that North American travelers are likely embarking on long-haul trips to Argentina or Chile for at least five nights while intra-country travel within Latin America is the engine driving the region's international arrivals. Meanwhile, he dismissed talk of overdevelopment in Brazil, explaining "not all inventory has been properly invested in to make it a viable option for international travelers and that reduces the spectrum of available rooms."

Corvinos and a development team of eight, focused on Caribbean and Latin America development, work with the region's many government entities that promote tourism, like Mexico's Fonatur, to focus on future development sites. But he's also casting a wide net in terms of prospecting the next wave of Homewood locales in Latin America. Beachside venues are an option "because there's travel there," he said. However, he offers a more granular example in the Homewood Suites Santo Domingo that's slated to open by first quarter next year. The property sits at the intersection of an existing JW Marriott and an InterContinenal and is also expected to remedy the neighboring Embassy Suites' overflow issues. "We try to pick winning locations, but that can differ from depending on the area of Latin America," Corvinos added, citing the Silao location's proximity to the airport as well as to the many industrial parks that sit on the airport's perimeter is a successful realization of Homewood efforts to target Latin American cities with production plants.

Yet, Homewood Suites' Latin America strategy takes more into account than simply location. The Homewood Suites Silao Airport was designed to the specifications of the brand's new Latin America prototype, which requires less square footage to develop than its North American counterparts, but still maintains core brand standards such as complimentary breakfast and evening reception, a communal "wings" or v-shaped table in the lobby, a sports facility like an outdoor sports court or miniature golf, an outdoor community space with an outdoor kitchen and a fitness center. As in North America, Homewood Suites in Latin America also allows for studio suites to comprise as much as 85 percent of room inventory.

But there are also adjusts to the regionalized prototype. The brand's "home office" will include a library in Latin America. Breakfast offerings will cater to local palettes rather than feature North American Homewoods' standard fare of eggs, bacon and pancakes. Additionally, Homewood Suites in Latin America will also offer a bar and full-service restaurant; to drive F&B revenues, the evening reception will be scaled back to an hour-long event offered twice or thrice weekly, with complimentary beer, wine and very light appetizers.

"In North America, Homewood Suites only has bars in urban locations, but in Latin America, our research shows that without a bar, travelers will make the decision not to stay with you," Kurre pointed out. The brand chief also expects the prototype will be refined as more Homewood Suites open in the region and thus, more available property data can direct greater product and design efficiencies. Kurre and Corvinos are also anticipating Latin American owners to surpass the prototypes requirements, based on the development of the Homewood Suites Silao Airport. "The innkeeper's tale in Latin America is very akin to luxury development in North America," Corvinos said. "There's a sense of pride in hospitality among owners in the region who go with us because of our name and feel that our hotels are reflections of their business acumen."

Another difference between Homewood properties in North and Latin Americas is the design. The interiors of Latin American properties will highlight the location of each hotel as properties will be more widely distributed throughout the region than they are above the Mexican border. At the Homewood Suites in Silao, San Miguel de Allende-based architectural and interior design Sebastian Zavala brought to life the area's recent past as a center of agriculture and automotive manufacturing through pictures of local farms and elements such as overhead lights suspended on pulleys.

The comforts of the Homewood brand are there, but Zavala created an overall effect that hints at modern industrial design-and that was entirely the owner's preference. Kurre said the grandeur of the library's floor-to-ceiling bookcase-spanning an entire wall from end to end-is not likely to be replicated in other Homewood Suites in Latin America, nor are owners obligated to exceed the prototype requirements.

But if Corvinos' parallel between Latin American property developers and North America's luxury hotel developers is at all accurate, future Homewood Suites in Latin America could also go above and beyond what the prototype dictates. Regardless, the brand's top development executive for the region indexes success for Homewood Suites in Latin America as "50 to 100 hotels in the region over the next 10 years."
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Miss Kerry Medina
Freelance Writer
Other (not listed above)
Kerry Medina, Freelance Writer
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