Charlestowne Hotels continued to expand its portfolio in 2023, but executives said it is measured growth, with the understanding that each additional property brings more responsibilities.
Kyle Hughey, CEO of the Charleston, South Carolina-based management company, said the threshold for adding a new property is that it has to be the right fit for the owner, Charlestowne Hotels and their employees.
“We’ve always been an organic, slow growth [company]. We’re very happy with our current clients and our hotels in our portfolio, so we really want to take good care of them,” he said. “We don’t ever want to grow too quickly where somebody gets neglected, an owner gets neglected, a general manager feels like they’re not getting the attention he or she needs to really develop themselves or execute on property.”
Charlestowne Hotels assumed management of six hotels in 2023: Hotel Verdant in Racine, Wisconsin; The H Hotel in Midland, Michigan; Little Mod Hotel in Charlottesville, Virginia; and The Russell Inn, Courtyard by Marriott Starkville and Hampton Inn Starkville in Starkville, Mississippi.
Four of those properties are located in college towns, with the Little Mod Hotel near the University of Virginia and the three Starkville properties near Mississippi State University. The company has 12 hotels in college markets, Hughey said, and has been managing hotels in college markets since 2012.
“Over the course of our 40 years in business, we will hang our hat on being a great manager in secondary and tertiary markets,” he said. “Usually, these colleges and university hotels fall within a secondary [market], so we already had the expertise in understanding how those markets work so it aligns with the rest of our portfolio, which is nice.
“We’ve learned how seasonal patterns work in a college market, and we know what marketing strategies to layer in and optimize revenue management, which drives revenue.”
Hughey said Charlestowne seeks to add about four to five properties in 2024. There’s also a desire to get deeper into the alternative lodging space.
Charlestowne has managed Wild Rice Retreat, a cabin rental retreat with 31 keys, in Bayfield, Wisconsin, for more than two years.
“I think we do manage an independent very well — best in the industry,” he said. “If the lane widens a little bit to include alternative lodging, we’ve got the sample, we know how to manage it, we know the experiential programming that needs to be layered into it, we know the logistics of a larger tract of land versus a traditional stacked hotel, so we want to get into that.”
Areas of Growth in 2024
Continuing to embrace new technology is among Charlestowne’s key strategies for growth in 2024. Hughey said technology has become a big discipline at all management companies in the hospitality industry, across departments such as marketing, revenue management and accounting.
He credits Vice President of Technology Maxwell Spangler with optimizing Charlestowne’s systems from a pricing and utilization standpoint.
“We’re conscious about price because we want to make sure that we’re not wasteful in money,” Hughey said. “Then utilization, a lot of times we got a right-size system access. If you start with us, you don’t get 20 systems; you may only get four because that’s all you need.”
The relevance of artificial intelligence in the hospitality industry burst onto the scene in 2023, Hughey said, and Charlestowne has already begun using it for corporate email databases and file management.
“AI is at the forefront of the industry, and we think we’re leading it,” he said.
There’s also a lot of unknown about AI as well, in particular whether the data run through these systems can remain secure.
“Security of our intellectual property and data — we got to be careful there, but in the right parameters, we think we can benefit,” he said. “We monitor what people take away from our database. The fear is oversharing secure data, things that are institutional data … so we have to really guard that. That’s the scary part.”
Another area of focus this year is continuing to evolve branding and concept development for Charlestowne’s food-and-beverage program. The company already markets its restaurants as their own entity in order to contend with the other restaurants in the market, he said.
“I really want to see our program evolve so that when we open a concept inside one of our hotels, it’s really not competing against other hotel restaurants; it’s competing against stand-alone restaurants, things that are in great markets,” he said.
Hughey said Charlestowne empowers team members to be heavily involved in this process so the finished product can be unique and authentic.
“We want to make sure their creative appetite is being met, [and that] they’re involved in the process and really all facets of the service,” he said. “Being competitive, creative and then really bringing to life that branding and concept and marketing as a stand-alone even though it’s really in a hotel — those are the kind of things we want to drive.”
Leadership
In 2022, Charlestowne unveiled a new leadership level of vice presidents that gained traction into 2023, Hughey said. Those vice presidents took on roles such as leading general manager summits, events and succession planning.
“They’re another leader within the company that can train and grow people underneath them and at the same time hold people accountable,” he said. “Accountability is a big thing with any growing company, so they’ve been doing a good job.”
Adding more leaders to the team was twofold; there was a need to accommodate for Charlestowne’s growing size as well as a desire to give company veterans a chance to move up the ranks, he said.
“We have these people who have been here for 10-plus years that are very, very talented — we don’t want to lose them to someone else, so we wanted to grow them professionally, give them the new vice president role and then empower them to lead a team, mentor other staff members and then hold them up with some accountability, some big emphasis or projects for the company,” he said.