Skift Take
It'll be interesting to see what works better for relatively smaller hotel companies like Loews, Red Lion, and even Hyatt with each of their respectively divergent business strategies: traditional asset ownership; totally asset-light; and asset recycling.
In an increasingly competitive hotel landscape marked by consolidation, Loews Hotels is hoping to stand out from the rest by doing things differently from its peers.
The New York-based hotel company, part of the larger Loews Corporation, isn't following in the footsteps of larger competitors when it comes to pursuing an asset-light strategy, something companies like Marriott, Hilton, Red Lion Hotels Corporation, and Wyndham have made the cornerstone of their business strategies.
While the company has only sold two hotels since 2015 and opened a total of seven, its next three hotel projects all involve development and ownership on Loews Hotels' part.
"Why have we focused more on building versus buying? It's simple," said Loews Corporation CEO James Tisch during the company's third quarter earnings call on Monday. "First, when you build something, you get exactly what you want. Second, we think the returns are great."
Tisch added that because "Loews Hotels is both an owner and an operator, a business model that is increasingly rare for hotel companies," it makes the company "an attractive partner for developers, immersive destination owners, and municipalities alike. We think like owners because we are owners, which creates mutually beneficial partnership dynamics for all constituents, something Loews Hotels has prided itself on for almost 60 years
