Red hotels will have a modern look and the ability to personalize rooms. Carlson Rezidor Hotel Group
The Radisson is creating a youth-oriented hotel brand, making its parent company, Carlson Rezidor Hotel Group, the latest entrant in a scramble to attract the millennial traveler.
The new brand, known as Radisson Red, will open its first location next year and plans to be operating 60 hotels around the globe by 2020, Carlson Rezidor executives say. The company says it will spend $140 million on building or acquiring the first five hotels and developing the Radisson Red brand.
Radisson, often considered a reliable, no-frills choice, plans for Red to be more daring. It will feature modern design with a large bar area. The hotel will allow guests to personalize their rooms to a larger degree than many of its peers.
Visitors, Carlson Rezidor says, will be able order a car to pick them up at the airport, request that the room's minibar be stocked with certain drinks, order a sandwich to be waiting at the hotel's 24-hour deli, and arrange for family photos to beam from the television screen when they enter their room. Guests will pay for these additional amenities on an a-la-carte basis.
"Red will focus on the younger traveler, but we see this as a long-term play," says Gordon McKinnon, Carlson's chief branding officer. He said the company expects the brand to evolve to keep up with "changes in attitudes and technologies."
Millennials, often defined as the group born between 1980 and 2000, are becoming increasingly important to travel brands as baby boomers age. The millennial generation is expected to account for nearly 50% of business-flight spending by around 2020, according to the Boston Consulting Group.
Carlson Rezidor is behind several rivals that already started new brands focusing on modern design and use of technology to lure the millennial generation.
Marriott International Inc. in 2011 joined with a Spanish hotel operator for a youth-oriented brand in Europe called AC Hotels by Marriott. The venture plans to bring AC Hotels to the U.S. later this year. Hyatt Hotels Corp. has been expanding the luxury-hotel brand Andaz, where roaming staff members use iPads to check in guests.
Starwood Hotels & Resorts Worldwide Inc. recently said guests at some of its Aloft hotels will be able to use their mobile phones as virtual room keys. Hilton Worldwide Holdings Inc., meanwhile, is gearing up to introduce a new boutique brand this year.
"Several of the brands are trying to anticipate the future and are putting in a lot of time, resources and energy," says Cathy Enz, a professor at the Cornell University School of Hotel Administration.
Some hospitality analysts say big brands face a challenge in trying to achieve cost efficiencies through scale and scope while also creating new hotels that feel local.
Michael Medzigian, chief executive officer for New York City-based lodging investor Carey Watermark Investors, says his firm spent $77 million last year to acquire and renovate the independent Hutton hotel in Nashville, Tenn., that has been popular with guests in the music industry.
"The success of some independents suggests that many millennial travelers prefer the authenticity of a one-of-a-kind property that's not part of a chain," he says.
The launch of Radisson Red is part of a major overhaul of Carlson Rezidor that started in 2010. By the end of next year, the company and its franchisees expect to invest as much as $1.5 billion on property upgrades, newer technologies and the introduction of new brands, Mr. McKinnon says. Carlson also is working on a new luxury brand known as the Quorvus Collection, with plans for 20 hotels by 2020.
Radisson Red is Carlson Rezidor's seventh brand, which includes its flagship full-service hotel Radisson and the midmarket Country Inns & Suites.
Red will feature public space meant to resemble a modern loft apartment, with concrete floors and adjustable lighting. The common area will be designed to feel like an art gallery with a reading room that becomes a lounge at night, a billiards room and a bar that will be open day and night.
Mr. McKinnon says room rates would vary depending on location, but as an example, he suggests that a Radisson Red in Manhattan could charge around $300 a night, while one in Minneapolis could charge around $125 a night.
via:http://online.wsj.com/news/articles/SB10001424052702304899704579390852044118462?mod=residential_real_estate&mg=reno64-wsj&url=http%3A%2F%2Fonline.wsj.com%2Farticle%2FSB10001424052702304899704579390852044118462.html%3Fmod%3Dresidential_real_estate