Hotel Group Faith in Asset Light Model Opens Gap for Upstarts
Skift Take
Most large lodging companies avoid owning real estate. This groupthink is dumb. One of the smartest strategic thinkers in hospitality, Inès Blal, is right to call for a more critical appraisal of the asset-light model.
Early Check-In
Editor’s Note: Skift Senior Hospitality Editor Sean O’Neill brings readers exclusive reporting and insights into hotel deals and development, and how those trends are making an impact across the travel industry.I began covering the hotel industry full-time earlier this year. One of the things I've been most struck by is how hotel investors have a near-religious belief in the "asset light" model.
The asset-light model means that hotel groups rarely own or long-term lease hotel real estate. Groups instead mostly run properties through management or franchised contracts. They leave the ownership of buildings and land to families or investment firms. Marriott was the first to do move in this direction in the mid-1990s. Today, asset-light is widely taken to be the only acceptable model for the so-called "parent brand" hotel groups. IHG claims to be the most asset-light. Marriott isn't far behind.Yet in any business sector, when everyone is going one way, that potentially opens up an opportunity for other players to grow by making different decisions on their core competencies and positioning.
Perhaps the sharpest mind on these issues has been Inès Blal, an academic.
Blal has published with colleagues several widely cited academic papers on strategic management in the hotel industry. Blal is cu