(Corrected on Oct. 20 to update the size of Kimpton's hotel portfolio in the 19th paragraph.)
PHOENIX — Kimpton Hotels & Restaurants has always embraced the practice of “do things differently,” and Chief Development Officer Allison Reid said the brand’s commitment to its core principles is allowing it to power through the pandemic with deep connections to its guests, along with strong performance and pipeline.
“We always have [founder] Bill Kimpton’s voice in our heads: Keep it simple. It’s not that hard. Have fun,” she said.
Reid took Kimpton's top development post in 2017, following a position as senior vice president of North America development for Starwood Hotels & Resorts Worldwide. In that time, Kimpton has expanded beyond North America, launched a franchise model and continued to forge its path as part of U.K.-based IHG Hotels & Resorts, whose acquisition of the boutique brand was finalized in 2015.
When the global COVID-19 pandemic hit in 2020, Reid said Kimpton leaned into IHG’s resources and “went deep on connection with guests.”
“We have always said Kimpton is about heartfelt, human connections,” she said. “We were trying to balance owners, employees, guests and brand integrity and we had to do what we were known for — human connections.”
She said that meant thinking about what people traveling during a stressful time needed and pivoting the brand’s offerings during the height of lockdown. The Kimpton signature daily wine hour turned into do-it-yourself cocktail kits available for guests in their rooms, and bodegas at the front desk provided common minibar items via contactless delivery.
All Kimpton hotels have made it through to date without permanent closures.
“We have really strong financial partners and no hotels permanently closed," she said. “We’re fortunate we got through the worst of it, and our pipeline has gotten stronger.”
Openings and Pipeline
Since the pandemic began, Kimpton has opened eight hotels around the world, including locations in Paris, Atlanta, Omaha and Tulum, among others. Those openings illustrate Kimpton’s operating-model flexibilities, its IHG backbone and its commitment to strong culture, Reid said.
“Kimpton is small and nimble and able to move quickly. IHG is big and has a lot of resources,” she said. “Our focus is ‘Know who you are and focus on who you are.’ We have a very narrow band of quality but a wide band of opportunity.”
Kimpton’s franchise model, launched quietly a few years ago, has expanded the brand’s footprint particularly into niche markets, including secondary urban cities and resorts.
The brand’s pipeline of 32 hotels includes hotels opening soon in Koh Samui, Thailand; Bali; and Sydney.
“In most markets we enter, there may be one other IHG hotel or none, so we’re able to grow quicker, and we have a lot of institutional capital,” Reid said. “I’m focused on making sure we continue to get the operations right. Get the numbers right. Deliver what you say you’re going to deliver, and let’s look for markets that need a Kimpton.”
She said resort and “resort-ish” markets are hot right now from a demand standpoint, particularly among IHG loyalty members, and it’s a product Kimpton can do well.
“Whether it’s beach locations or mountain, more locations are becoming what I call ‘resort-ish,’” she said.
And while urban locations continue to struggle, Reid said Kimpton can benefit, because it is looking for conversion opportunities in urban areas “where some of our competitors are saturated and we are not.”
Still, Reid acknowledged Kimpton’s commitment to a location is long-term, no matter what operating model is in place.
“We grow where we make an impact in the community, and that means you need to be there long term,” she said.
As of June 30, Kimpton’s global footprint of 75 hotels and 13,215 rooms was skewed more heavily toward managed, but Reid said “the market for franchise has expanded.”
“It’s always a good balance to have franchised, managed and some ownership,” she said. “IHG does not own Kimptons, but we have large investments in some, which allow us to think like an owner.”
Performance
As of the midpoint of 2021, Kimpton’s revenue per available room was top among IHG brands globally.
“We outperform [many competitor brands] in rate and occupancy,” Reid said. “Brand averages are great, but I like to look asset by asset, which is a more telling picture. When I look at these hotels, I know it’s because of our employees. Everyone has nice hotels now, so why would someone spend more to stay with us?”
She said the answer lies with employees.
“We’ve grown our loyal customer base in the pandemic because we leaned in to what we do,” she said. “Our property teams are amazing. There’s no scripted service at Kimpton; it’s more about interacting the way you know a guest needs interaction. We get better employees than the average brand because our people know they can always be themselves.”
The brand’s restaurants also contribute to performance, Reid said. Stand-alone restaurants have always been a Kimpton hallmark, and Reid said that while the company has “evolved the cost model,” it has not changed the basic tenet that the restaurant must be able to stand on its own and appeal to local demand.
“How we deliver the restaurant model, whether it’s managed or leased, depends on the market and location, but our strength in restaurant allows us to charge a higher [average daily rate], as does our strength in people,” she said.
Challenges
Of course, growth in a time of uncertainty isn’t without plenty of challenges, Reid said.
“Underwriting the unknown is tough,” she said. “If we’re looking at a conversion, a lot of the unknowns are resolved around the building, so the unknown becomes ‘Can this brand deliver better than what it was before?’ and that’s an easier nut to crack.”
New development carries much more risk nowadays.
“Right now, every single field will tell you their biggest concern is risk — risk to the business, personal risk to employees — and hotels are no different,” she said. “We get the deal done when I know we’ve mitigated the risk far better than anyone else.”
In the long term, Reid said she’s excited to see Kimpton’s core guests — who undoubtedly typically fall into higher spending brackets — back on the road.
“People want to travel now, but we’re also tuned into the knowledge that things can change in an instant,” she said. “A lot of people now want to be about something bigger than they are. This is why basic hospitality has never been stronger.”