IHG last week reported Q1 results, which showed comparable global RevPAR up 5.9% driven by a 3.4% increase in rate. At the same time, IHG’s system size year-on-year was up 4.9% (3.3% excluding the addition of the Kimpton portfolio) to 723,000 rooms.
On the occasion of the announced results, HOTELS interviewed IHG’s Americas Chief Development Officer Joel Eisemann, who spoke enthusiastically about what has so far been a smooth integration of the Kimpton brand into the IHG fold. “The Kimpton deal closed 10 days before ALIS (in January), which allowed us to meet with key owners of Kimpton hotels and talk about the new combination and direction of the brand,” Eisemann said. “We received nothing but outstanding comments in response.”
Eisemann added that within 24 hours of the deal being announced, he personally was overwhelmed by calls from interested developers. “There was a level of confidence in the combination of IHG and Kimpton,” he added.
Outside North America, Eisemann said IHG has already had requests from a number of owners to build or convert to the Kimpton soft brand. “We are in the early stages internationally, and we have no announcement yet,” Eisemann explained. “It will be somewhat opportunistic, and we hope to announce deals soon.”
Since the acquisition, IHG has secured four new signings, and three new properties have opened, growing the room count by almost 5% in just over two months.
First-quarter results also revealed IHG had its strongest signing quarter in seven years with 14,000 new rooms added to its pipeline. Eisemann suggested increased owner confidence, loosening of finances and the economy played into the news.
At the same time, when asked about concerns about oversupply, Eisemann said the numbers must be broken down by market. “Some U.S. coastal markets are seeing increases, and there are some concerns with a few markets,” he said. “But talk about markets like Manhattan in New York City, we expect the supply gets absorbed with a short-term impact on rate. Overall, we are broadly optimistic and continue to do detailed analysis by market.”