Hilton Launches ‘Undergraduate’ Hotel Brand for College Towns. Here’s What the Numbers Say.

Key Points

• Hilton has launched a new hotel brand called Undergraduate, targeting smaller college towns with fewer amenities and lower development costs than its Graduate brand.
• The Undergraduate brand aims for 400-500 locations, with a design focused on communal spaces and local college themes, and an average nightly rate of $120-$140.
• Hilton faces challenges such as inconsistent demand in college towns and a crowded upper-midscale market segment, but expects conversions of existing properties and loyalty program demand to drive growth.

Summary

Hilton has introduced Undergraduate, its 27th hotel brand, aimed at serving smaller college towns that its Graduate brand doesn't reach. With fewer amenities and lower operational costs, Undergraduate targets the upper-midscale market, offering nightly rates between $120 and $140. Hilton plans rapid expansion with 400-500 hotels, focusing on communal, college-themed designs and innovative food and beverage programs. Despite challenges like inconsistent demand and a crowded market, Hilton is betting on loyalty program members and conversions of existing properties to ensure the brand's success.