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The dual-branded hotel model has been attractive to many hotel players since the early 2010s, but the idea of doing more with less has garnered particular favor in the current environment – for good reason.
High interest rates, labor shortages, the increasing appeal of mixed-use developments, less available land, heightened material and construction costs and the ability to pull in different but complementary types of travelers have put this efficient model front and center for certain hotel investors in certain markets.
Mark Kallenberger, principal of hotel investment consultant firm Kallenberger Jones & Co., believes the dual-branding approach can be win-win-win.
“It is market-driven in that it benefits hotel guests, franchisees and franchisors,” he explains. “Hotel customers are afforded more purchase choices, increasing the possibility they’ll find ones that better meet their needs. Franchisees are often able to realize higher financial returns and possibly limit competition from other developers. Franchisors are able to enhance the distribution of their brands, especially when launching new brands.”
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