HOTELS Interview: Danziger’s dreams for Hampshire

Hampshire Hotel Management (HHM), the New York-based company that currently operates 11 boutique and lifestyle properties under the Dream, Night, Time and Chatwal names, has new leadership from brash industry veteran Eric Danziger, who until earlier this year was president and CEO of industry giant Wyndham Hotel Group.

Danziger, with more than 40 years of industry experience, is boasting about big plans to dramatically extend the reach of the current portfolio and establish Hampshire as a full-service management company. Among his plans:

  • Segment the brands into four levels, including a new 5-star luxury brand
  • Grow the portfolio in national and international markets, especially for the upscale boutique Dream brand
  • Evolve The Time hotel into an upper-upscale brand to complement Dream
  • Create a “lifestyle light” brand in the upper-midscale range
  • Evolve the Night brand to target upper-economy through limited-service
  • Develop a third-party management and asset-management expansion strategy

In fact, over the next few weeks, Danziger — who owns 25% of the company alongside the 75% owned by the Chatwal family trust — is supposed to further explain expansion plans for the company and announce some of the new cities signed for Dream, designers involved as well as names for one or potentially both of the yet-to-be-announced brands launching under the HHM umbrella.

"I think we'll have several hundred hotels in six years. I think Dream's going to be the leader, and I have to say that number could get significantly larger if I were to do something like franchise Night." - Eric Danziger
“I think we’ll have several hundred hotels in six years. I think Dream’s going to be the leader, and I have to say that number could get significantly larger if I were to do something like franchise Night.” – Eric Danziger

HOTELS spoke extensively with the cigar-smoking, scotch-drinking, always quotable Danziger about his plans for HHM and the challenges he faces turning a small, New York-based group with a bit of a checkered past into a global player.

HOTELS: How are you, Eric?

Eric Danziger: I’m great. I’m having fun, too, building a new company. My office is on 55th and Seventh in Manhattan, and I have a six-minute walk — three-and-a-half blocks — to work.

HOTELS: You have big plans. Can you summarize the strategy?

ED: I’ve been here almost six months developing a strategy because the history of the company wasn’t steeped in strategy. Now we have a really exciting strategy that I think will result in several hundred properties. 

The Chatwal is a very successful luxury hotel in New York, and I believe that is exportable although it will have a new brand, which I’ve selected but can’t tell you because I need to file for a trademark and registration. The first one will be in New York with a third-party owner. We will manage.

Brand two is Dream, an upper-upscale lifestyle brand where people want to be seen. So, heavy food and beverage — we do US$20 million a year at the penthouse at the Dream downtown in New York.

But, for a guy like me who goes to bed at 9 p.m. and doesn’t want a scene, we have a brand called Time. It was originally designed by Adam Tihany, but because we were a real-estate company more than we were an operating company, it’s not as pretty as it was 15 years ago. We’ve now hired David Rockwell, and he’s redoing it. Its going to be upper-upscale, lifestyle but elegant, quiet and sophisticated with a nice bar and restaurant.

The other new brand was going to be called Life, but we found we couldn’t use the name, so I have another one that’s lifestyle-sounding for owners who want to be relevant to today’s guest. I believe we’ve designed it in a way that they don’t have to spend any more money to do that than they would just to stay up with the PIP of the current brand.

You don’t have to change everything. You only have to add these essences of lifestyle — some new lobby furniture and some things in the room — but you don’t have to tear down walls. It’s for the 3-star, 250-room hotel owners who want to be unique and different from the typical comp set.

Then there is Night. We changed the logo already, and we have completely redesigned this thing. It is super cool. It’s the same kind of concept I just gave you — but for select-service. So maybe for US$6,000 a key you can be lifestyle. It’s limited-service, you don’t have to have food and beverage, the front desk turns into a bar at night and rooms convert from a daytime to a nighttime setting.

So, those are the five brands that we’re either launching or will launch. I feel very excited. I think I’ve signed seven or eight Dreams already in four months.

HOTELS: What are you doing about distribution?

ED: We have hired TravelClick because we’re unplugging from Wyndham at the end of the year. TravelClick has designed our website that is relevant, cool, fun and unique. It’s video from the moment you open it up. Then we hired Sabre to do the back end. So, our white-label website is going to be awesome.

But I want to respond to the distribution thing a little differently. We built Dream in the Meatpacking District before the area evolved and did US$80 million because we created a reason for people to say “that’s the hotel to be at.” So I’m not worried about distribution because we are plugged in where we have to be. But, it’s this sense of creating something unique where customers say, “I want to be there.”

HOTELS: Are you looking for strict management, or is HHM willing to invest?

ED: We don’t want to own a hotel outright. We’re not in the real-estate business, but we have put money in almost every deal I’ve done. Where needed, there is sliver equity or loans, mezzanine loans, that kind of thing.

The Dream Downtown in New York's Meatpacking District (photo by Phillip Ennis)
The Dream Downtown in New York’s Meatpacking District (photo by Phillip Ennis)

HOTELS: What Dream hotels are under development now?

ED: We’re building another one in New York at 40th and Seventh. We are under construction in Hollywood, California. We’re doing a 500-room Dream in Chicago, and we are doing Dreams in Long Island City, New York; Dallas; Houston; and Austin, Texas. We are also working on London.

We’re going to do a hotel at Staples Center in Los Angeles — that’s not a Dream. That’ll end up being a Time or the 3-star brand.

We’re also doing third-party management, and I think we’ll probably add a significant amount of hotels running brands other than our own — probably adding on the order of two or three a year.

HOTELS: What are you doing to grow your team?

ED: We’ve added a VP of strategy and a VP of people and culture, we’re hiring an IT VP and I hired five development guys. We also created a VP of operations for lifestyle and a senior vice president of sales. We’re adding very substantially to the number of people. 

HOTELS: The Chatwal family has received a fair amount of bad personal publicity in the past year. How are you managing this with developers?

ED: It’s not relevant to what we’re doing at Hampshire. It hasn’t stopped anything because I can say that there’s one CEO of this company. The family contributes in different ways. Vikram [Chatwal] is a design and events genius. I wouldn’t think about doing a Dream without getting his unique and valuable design and creative imput.

I do have to explain the bad press that he’s had and said, “He’s not the only son of a wealthy person who got in trouble.” We all add value in our own way and these past troubles are not relevant to today’s issues.

In response to Sant’s recent trouble, I just explain that Sant is a good man who did a bad thing. He acknowledges it was a bad thing on political contributions and pleaded guilty. He’s not involved in the decisions I am making. His only interest is when we find something that requires significant equity, he comes in to represent the investment on behalf of the family.

HOTELS: What is HHM’s biggest challenge?

ED: Part of it is just a little bit of letting people know that the old Hampshire that was just kind of a real-estate company with this hotel and that hotel is not what this is.  This is a real hospitality company now with real brand strategies, real people, real go-forward direction and real performance. So, it’s telling the story.

HOTELS: What are your projections for HHM?

ED: I think we’ll have several hundred hotels in six years. I think Dream’s going to be the leader, and I have to say that number could significantly get larger if I were to do something like franchise Night — not only domestically but bring it to South America or Asia.

There could be 40 to 50 Dreams. Ditto for Time. Time might have 50, 60, 80 of them because not every owner who wants to do upper-scale lifestyle can do that “scene” stuff. I think each of our brands has the capacity to be somewhere between 40 and 150 and then significantly more than that once I push a franchise button.