TORONTO — Realstar Hospitality, master franchisors of Motel 6 and Studio 6 brands in Canada, have decided to combine the two brands under one roof, giving travellers a crisp, clean, contemporary and economical option for both overnight and longer-term stays.
“In the upper upscale segment, there is a precedent for hotels that offer rooms sold by the day and for longer-term says, but G6 [parent company of the two brands] realized there was nothing in the economy segment. What better than to take Motel 6 and its extended stay sister, Studio 6, and marry the two,” said Irwin Prince, president and CEO of Realstar Hospitality.
The building would have the same footprint as a Motel 6, but half the building would be 100 per cent extended stay and the other half a Motel 6, said David Blades, vice-president of operations.
“There's a lot of interest from Ontario and the West,” added Blades. “It's gaining traction, and in the next few months, we should see some shovels in the ground.” Realstar hopes to have two to five of these dual-branded hotels under construction by the end of the year.
While the communities expressing interest are still highway locations, they don't have to be as prime a location. In secondary and tertiary markets, there is often some extended stay demand and a lot of overnight demand. “It's a nice separation [of the brands] in a beautiful building with a design that appeals to guests from millennials on up — it offers frugal functionality and great value,” said Blades. In these markets, the dual branding gives you more bandwidth, he added.
One reason the dual-branding is so appealing in Ontario and the West, is the cost of labour, which has skyrocketed in those markets. Extended stay rooms require much less labour, as they are serviced midweek, as opposed to overnight hotel rooms that are serviced every day. If 50 rooms in a 100-room property are extended stay, labour costs drop dramatically.
It has a smaller footprint than two stand-alone hotels. “Our cost to build is traditionally cheaper because the footprint is smaller. Construction costs are traditionally under $100,000 per key, versus other traditional brands.
“Motel 6 and Studio 6 don't focus on things like meeting rooms and restaurants. They often don't have a pool and other luxuries that push costs up,” said Prince. He pointed out that depending on the markets, these brand can work in communities with populations under 5,000 people. One example is the Studio 6 in Bruderheim, Alta., population under 2,000.
G6 is currently building the new dual-brand in Austin, Tex., and other locations, but the concept is new to Canada. Canada currently has more than 30 Motel 6 locations here; 35 including the properties owned by G6. Canada has just 3 Studio 6s. Potential clients are more receptive to the dual-brand combination.
“For new construction, this version just makes economic sense,” said Blades. Conversions would usually be to a single brand, usually Motel 6.