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Critical Mass Is Coming

Tru by Hilton Hits 50-Property Milestone With Many More On The Way

Tuesday, January 08, 2019
Dennis Nessler
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Well on its way to reaching critical mass some three years after being formally introduced, Tru by Hilton recently opened its 50th hotel and continues to gain momentum among developers with a pipeline that’s exponentially larger.

In fact, the midscale brand – which opened its first property in April of 2017 – ended 2018 with 53 hotels open and more than 300 properties in its pipeline. The Tru by Hilton in Shepherdsville, KY, debuted in the fall and represented the brand’s 50th hotel.

Bill Duncan, Hilton’s Global Head of All Suites and Focused-Service Category, touted the brand’s massive development potential acknowledging that he agrees with Hilton CEO Chris Nassetta’s early assessment of Tru when he noted “it could be one of our largest brands globally.”

Duncan, who described the brand as “fun, energetic, cutting-edge and innovative,” elaborated on Hilton’s decision to enter the midscale segment by pointing out the company took a similar approach when it launched its Home2 Suites extended-stay brand.

“We brought a bunch of owners together to help us create a brand that they would want to develop and grow their relationship with Hilton. So we uncovered white space that we felt we were not serving based on guest demand and research figures and that was this midscale space and we realized it was a hole in our offering,” he said.

Duncan further commented on what he described as “the fastest brand launch ever” with Tru. “When you combine the white space with the customer research and developing a brand that owners want to build and then you wrap that all around this amazing Hilton engine it has just been wildly successful for us. We are tremendously thrilled and we’re seeing very strong development,” he said.

The new construction, pure-franchise brand features slightly smaller, more efficiently designed guestrooms, which are 10-feet wide as opposed to the standard 12-foot width and 228 square feet in total. The properties also feature a 2,880-square-foot lobby with areas for guests to work, play games, eat and lounge and a 24/7 market with gourmet snacks and drinks.

Duncan noted the brand has been tweaked slightly following the launch of its first couple hotels and after eliciting feedback from owners and guests. For example, the breakfast program was redesigned and redeployed with a breakfast meat and egg upgrade to add more protein. In addition, the brand changed out the desk and chair in the guestroom for a larger version. There were also a couple of small physical property upgrades, according to Duncan. “Customers are responding very strongly to the changes we made and to the brand,” he noted.

Duncan, meanwhile, talked about the development mix for the nascent brand.
“Quite a few of our Tru’s are with existing partners, but we are seeing a nice number and are looking to grow new Hilton owners as well. We feel like this is just such a great pricepoint for owners to enter into a relationship with Hilton in this segment. We are seeing some great movement and are going to continue to grow that focus for the company. We think this is great brand to do that because of the pricepoint to build,” he said.

Duncan maintained the brand is primarily focused on primary and secondary markets, but has also considered urban locations when “there was the right opportunity.”

Some of the urban markets that Tru has already entered include Salt Lake City; San Antonio; Louisville; Oklahoma City; and Las Vegas. In addition, there are locations scheduled to open this year in Denver; Nashville; and Cleveland. Other urban locations under construction include Austin; Charlotte; Charleston; and Savannah.

The brand is also poised to debut in Canada this year in Edmonton Windermere.
Duncan acknowledged that while the brand has been focused on the U.S. and Canada, international expansion is also on the horizon as well. The brand has inked a development deal in Puerto Rico and is looking at another opportunity in Latin America. However, Duncan described those forays as “just a toe dip.”

He elaborated. “We want to be really comfortable with the commercial performance in the U.S. and Canada, specifically, before we get too far into a launch anywhere else, because we do feel that’s going to be the hub of growth for the next couple of years. Then we can take some of the emphasis to focus on other parts of the world,” he said.

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Dennis Nessler    Dennis Nessler
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