Extended Stay Riding High on Newfound Status with Corporates

“The extended stay category was a game changer for us during the pandemic and introduced new customers to the extended stay brands that maybe never would have thought, ‘You know what, as a business traveler I normally have a two-night stay but this time it’s going to be a two-week stay—you know, maybe I'll consider this brand,’” said IHG VP of Americas Sales Yola Marshall, whose Staybridge Suites brand took third place honors among the Upscale Extended Stay category in BTN’s 2022 Hotel Survey. “It really resonated with a lot of travelers, specifically with that small- to medium-enterprise traveler who was really out there [during the pandemic], and those travelers have now transitioned to be our new frequent guest.”

That experience was not uncommon for many extended stay brands that had been somewhat deprioritized in the corporate transient space and largely considered for project groups or relocations. But the pandemic turned that story on its head, with business travelers staying longer and needing different options from their corporate hotel programs.

According to voters in BTN’s survey, Hyatt House delivered best on the benefits of Upscale Extended Stay, with some of the strongest scores around the quality of its physical properties and its brand consistency.

“Hyatt House is built upon the concept of home, and Hyatt has taken thoughtful steps to provide guests with the ability to make themselves at home while enjoying an elevated, spacious and … self-sufficient experience,” said Hyatt in an email statement attributed to VP of global sales Gus Vonderheide. “In listening to our guests traveling for business, we know a segment of these travelers will gladly trade full-service for added space and the comforts of home while on the road.”

That’s a key acknowledgement and one the company has leaned heavily into with Hyatt House—providing a great physical space with living and sleeping accommodations and well-appointed bathrooms and kitchens that allow the traveler to be self-directed about how they consume Hyatt House hospitality, but it has been up to the brand to understand what services and products travelers want to help themselves to—and that has changed during the pandemic, wrote Vonderheide, with the surge in remote work. 

“We launched Work from Hyatt in 2020 to enhance the extended-stay experience for remote workers by providing amenities such as a dedicated workspace, complimentary high-speed internet [and] daily food and beverage credits,” he wrote regarding Hyatt House. IHG’s Marshall said the Staybridge Suites brand also recognized the growing demands of extended stay business travelers, and doubled down with its evening socials, providing more variety and reasons to attend.

“People really need that connection to other people,” she said. “More than 60 percent of our guests attend the social more than one time during their stay and 75 percent [attend at least once] and stay for at least 30 minutes. We’ve gained new business travel guests from some new verticals through reinventing those, while some other brands walked away from that part of the value proposition. We took a different approach.”

Marriott global development officer for the U.S. and Canada Noah Silverman touched on some of the same points during the Americas Lodging Investment Summit in Los Angeles early this year, speaking about the hospitality giant’s Residence Inn brand, which took second place in the Upscale Extended Stay segment in BTN’s 2022 Hotel Survey, as well as its TownePlace brand, which took first place ahead of Extended Stay America in the Midscale Extended Stay category.

“The brands have always had appeal, given their programming and given the room offerings, the layout, and the features of the hotels. They’ve always had appeal to a combination of both business travelers and leisure travelers,” he said.

The entire U.S. hotel industry is building on that point—very literally. At the end of the third quarter, the U.S. hotel pipeline had nearly 1,846 projects and more than 189,000 rooms dedicated to extended stay, according to a report from Lodging Econometrics. That accounts for 35 percent of total hotel projects in the U.S. pipeline. Home2Suites by Hilton, which didn’t make the BTN cut this year, has 494 projects in the works. Marriott’s extended stay pipeline follows with 291 TownePlace properties and 234 Residence Inn locations underway. IHG’s Staybridge Suites brand has 124 properties in the works.

Lodging Econometrics didn’t call out development projects for Hyatt House, but Hyatt promoted a significant push for Hyatt House earlier this year as part of a 2022-23 U.S. expansion project.