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U.S. Hotel Groups Still Dominate at Home with Hilton Leading the Pack

With Market Saturation Nearing, Groups Looking Abroad to Promote Products and Concepts


September 6, 2011 - US based hotel groups and brands continue to dominate at home. However, as the local market is the most mature hotel mare, future development growth is being explored abroad, with Europe and Asia the priority.


The US hotel industry continues to be dominated by locally based groups, completely made-up of household and locally developed brands. According to latest research conducted by industry experts MKG Hospitality, Hilton Hotels remains the number one group in the US with over 486,000 rooms. Making up the top three groups is Marriott International with over 480,000 rooms and Wyndham Hotel Group with over 455,000. The number one hotel brand in the US is yet again Hampton Inn with almost 171,000 rooms, followed by Best Western with over 165,000 and then Comfort Inns & Comfort Suites with over 160,000.


“The US hotel industry is very much controlled by locally based companies. Indeed, the corporate chain hotel structure was born and perfected in the US, so it is logical that local names have such a strong presence in their own market,” states Director of Development, MKG Hospitality, Vanguelis Panayotis. “However, the US hotel market is fast approaching saturation. Thus, groups are seeking expansion in international markets, exporting their products and concepts.”

In fact, almost two thirds of room stock among the top 12 hotel groups is found right here in the US. Of the top 20 hotel brands, almost three quarters of stock is based here in the US – many brands having little or no presence outside the country. The only exceptions are purely due to acquisitions (and again of US manufactured brands), with InterContinental Hotels Group taking over Holiday Inn and Express by Holiday Inn and Accor purchasing Motel 6 (Redd Roof being sold in 2007). After this, you have to go way down the list to find another foreign brand, namely Canadian based Fairmont Raffles and Four Seasons Hotels & Resorts in 25th and 26th position, respectively.


Looking at pipeline growth, US brands are now very much focused abroad. Europe is a prime choice due to being the second most mature hotel market after the US, as well as having ideological and cultural similarities therefore better suited to product concepts. Meanwhile, Asia and the Middle East are also hot development markets. There are however many challenges to overcome for US hotel groups seeking expansion to other worldwide markets. For starters, adapting their structure to fit local laws and regulations, as well as consistency with real estate values, hence investment strategies. Then there is existing competition from domestic players that are well represented, especially in Europe.

“The key to success will be how quickly they can reach a critical network size even somewhat similar to what they have in the US. This is especially true for economy and budget brands where such factors are crucial in order to make business sense,” adds Panayotis.

ABOUT MKG Group
Established in 1985 by Georges Panayotis, MKG Group has built a solid reputation for business expertise and substantial European-based know-how in the fields of tourism, lodging and food service. MKG Group meets the needs of each of its clients by providing valuable analytical and decision-making skills necessary for success. www.mkg-group.com

For further information , please contact :

MKG Group - International Development Department
Vanguelis Panayotis
T. : +33 (0)1 56 56 87 87
v.panayotis@mkg-group.com

MKG Hospitality - Media Contact
Michael Komodromou
Tel: +44 (0)20 7624 4030
press@mkg-group.com
Web: www.mkg-hospitality.com

 


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Middle East & North Africa Hotel Markets End 2010 with Great Disparity, Uneasy Hotel Growth is Forecast / February 2011

Poland's Hotel Industry on Upward Trend with RevPAR and Occupany Steadily Growing / November 2010

The Top 10 Hotel Groups in the World; IHG Retains Top Spot With Nearly 650,000 Rooms / July 2010

The Top 10 Hotel Groups in the World; IHG Retains Top Spot Surpassing the 600,000 Room Mark / May 2009

Top Twenty Hotel Brands in the World at January 1, 2008, Also Top Ten Hotel Groups in the World / April 2008

The 2008 Top 20 European Hotel Brands Ranking and the Top Ten Hotel Groups Ranking / March 2008

Ranking - Top Ten Worldwide Hotel Chains Growth 1995-2005 / October 2005
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