NEW YORK — While it seems like all of the major hotel brand companies are vying for space in the extended-stay segment, Extended Stay America President and CEO Greg Juceam believes his company still has a "first-mover advantage."
"We have extended stay in our actual name and a long track record of being in the space," he said in a video interview with Hotel News Now at the NYU International Hospitality Industry Investment Conference. "So some of them are going to come in and do particularly well. Some of them, I think, are going to find it's not quite easy."
Large hotel companies such as Hilton, Hyatt Hotels Corp. and Marriott International are among the groups that have launched extended-stay brands in recent years. ESA has also launched two new brands of its own with Extended Stay America Premier Suites and Extended Stay America Select Suites.
Juceam said success comes down to — in part — understanding the different operating model for extended-stay hotels compared to traditional hotel brands.
"For us, being the first is helpful and having a very long average length of stay that has been proven over time through cycles is something some may be able to replicate, but we believe most will struggle with. And it's particularly important to note that the new brands that are coming in, in many ways are more expensive to build and to operate than our hotels."
He added some industry discussions about a flattening growth curve for extended-stay hotels is a bit overplayed, particularly when you take a long-term view of the segment.
"When you look at the extended-stay segment, particularly where we are in the economy and the midscale space, relative to say 2019, pre-pandemic, that industry has had the greatest upswing over this three- or four-year period," he said.
That same period has been "the most transformative" in ESA's history after being taken private by Blackstone and Starwood Capital Group, Juceam said. That includes the launch of the two new brands, the acquisition of over 100 hotels to start the Select Suites brand, along with significant internal investments to make the company more efficient.
"We've redone our entire tech stack over that time, whether it's the property management system or [central reservation system]," he said. "Now we're doing the [revenue management system] and data optimization framework to better analyze all of our data and make better decisions."
For the full interview with ESA's Greg Juceam, watch the video above.