Another day, another traditional hotel company is taking its hat off to all-inclusive resorts.
IHG . Hotel & Resort, owner of brands like InterContinental and Holiday Inn, this week announced a partnership with Spain’s Iberostar to add up to 70 all-inclusive resorts to its network. While IHG won’t actually own the Iberostar Beachfront Resorts brand, the partnership is seen as giving the company its 18th trademark.
The move is the latest in a string of brand additions over the past decade at IHG. The company has acquired or added services such as Avid, Atwell Suites, Regent, Six Senses, Kimpton and Vignette Collection. This is also the latest hotel company to enter the field of all-inclusive resorts; Package travel was once dominated by brands like Sandals and Club Med, but now traditional hotel companies and their massive loyalty programs have entered the market.
Marriott, Hilton Hotel, Hyatt and Paris-based Accor have both undertaken varying degrees of all-inclusive resort expansion over the past few years. There is a method to IHG’s partnership strategy with Iberostar rather than organic growth or acquisition.
Keith Barr, CEO of IHG, said in an interview on Tuesday with TPG: “To think that overnight we will be able to do it as well as they have done in five decades is a bit of a stretch. arrogant, to put it mildly. “We have partnered with a world-class brand. It will continue to grow and accelerate, and we can benefit from that.”
IHG’s new all-inclusive product line
More than 24,000 rooms are included in the deal, and all properties face the sea. While Iberostar will retain ownership of the trademarks, the resorts will be integrated into the IHG One Rewards platform — meaning you can earn and redeem points at these properties and stays will earn points and nights to achieve elite status.
Iberostar has a small collection of hotels in the city, as well as an operation in Cuba, which is not part of the deal. Of the 70 hotels that will be affiliated with IHG, 40% are located in Spain and 22% in Mexico. Other top Iberostar Beachfront Resorts brand destinations include the Dominican Republic, Jamaica and Brazil, as well as other locations in Europe and Africa. Six other resorts are currently under development.
Resorts in Mexico, the Dominican Republic, Jamaica, Brazil and Spain’s Canary Islands will join the IHG network later this year. Additional facilities in Spain, Southern Europe and North Africa are expected to join IHG’s system in the next two years.
“They have a vision of how this company will become a lot bigger in the coming decades, which will be a win-win for us and we want to make sure we are a part of that as well.” part of that,” Barr said before noting integration as the main focus for now.
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IHG operates 260 resorts around the world under the Six Senses, Regent, InterContinental, Kimpton, Hotel Indigo, Crowne Plaza, Holiday Inn and Holiday Inn Club Vacations brands. However, the Iberostar alliance is very following the development trend in the hotel industry of “take profit” trades fill in the gaps where a hotel company previously did not have much of a presence.
The Regent and Six Senses deals have given IHG a greater presence in the non-existent ultra-luxury sector when InterContinental is the company’s flagship offering. The Iberostar Alliance gives IHG a larger footprint around the world, as IHG has fewer than 20 resorts in the countries where the Iberostar Beachfront Resort is located.
Resorts range from family-friendly “premium offerings” to adults-only luxury resorts. Some of the properties about to be incorporated by IHG include Iberostar Grand Paraiso in Mexico’s Riviera Maya, Iberostar Selection Hacienda Dominicus in the Dominican Republic, Iberostar Grand Rose Hall in Montego Bay, Jamaica and Iberostar Selection Anthelia in Tenerife, Spain.
Don’t expect too much drastic changes to the way Iberostar resorts operate, as Barr emphasized that the family-run Iberostar business has focused on high-end resorts with exemplary customer service. The company’s leadership team includes Miguel Fluxá, president of the Iberostar Group, as well as his daughters Sabina, serving as vice president and chief executive officer, and Gloria, vice president and chief sustainability officer. of the company.
“It’s a family owned business, so they’re proud [in the resorts]: You see Don Miguel walking in the hotel buffets. You see Gloria and Sabina talking to colleagues,” Barr said. “Here are their people, and here are some of the best maintained hotels I have seen in the resort space. [with] Food and drink specials. We don’t need to teach them how to run a hotel.”
An increasingly competitive field
The hotel group’s push into all-inclusive resorts is a rapidly growing trend. Hyatt acquired Apple Leisure Group for $2.7 billion late last year, and Marriott first announced its own $800 million push into an all-inclusive orbit in 2019. Accor plans to quadruple its all-inclusive premium Rixos brand to 100 hotels by 2027.
Luxury offerings in the all-inclusive sector are also on the rise, growing from 17% of Mexico’s all-inclusive resort supply in 1990 to 33% this year, according to a report from the hotel and real estate division. JLL’s property. That luxury boom helped all-inclusive resorts in Mexico exceed pre-pandemic rates earlier this year.
IHG’s focus in this area will be on more upscale hotels, as has been a significant part of its expansion in recent years.
While mainstream brands such as Holiday Inn and Holiday Inn Express are the dominant force across IHG’s product portfolio, the company has recorded some impressive growth in premium and luxury. Barr said the Six Senses development portfolio has more than doubled since IHG took over.
“I think we really underestimated the halo effect of buying Six Senses, and I think it really shows [along with Regent] that we will be playing in a different category,” he added. “Transactions like this and how we strengthen the team will continue to provide more and more opportunities to follow to continue delivering that growth.”
Barr often likens the branding at IHG over the years to the process of filling in the missing rungs. Much of the branding added over the past decade has taken place under his supervision as CEO. So does Iberostar mean the ladder is finally finished?
“I think there’s always more work to be done,” Barr said with a laugh. “There are other places we can play and where you can continue to build on this. There are some other exciting things, and what I find very interesting is that by doing this and being creative, it opens up even more opportunities.”
