Is There a Paradox at the Heart of Some Boutique Hotels?

"That is one of several conclusions you're likely to draw after reading an article by Sheila Yasmin Marikar recently published in Air Mail. Marikar takes the reader into the world of small boutique hotels, the sort of establishment that attracts travelers looking for properties with an independent streak and a unique approach to doing business. The challenge here, though, is figuring out where that line exists, as some iconoclastic companies have acquired massive corporate parents over the years."

"Air Mail cites the example of Mr & Mrs Smith, a company Marikar describes at one point as "a hotel-booking service that represents some of the best independent boutique hotels in the world." Except that doesn't tell the whole picture; as Marikar reveals, Mr & Mrs Smith was acquired by Hyatt a few years ago. Hyatt is not the only large player buying up smaller companies: Air Mail's reporting points to everyone from Marriott to private equity firms as investing in the boutique space."

"To be fair, there are understandable reasons for a formerly independent company to sign on with a larger corporate parent - including making it easier for travelers who are part of a rewards program to branch out. But there is also the question of whether a corporate sale will cause a business to lose what made it distinctive to begin with. Still, the process described in this article continues unabated; in September, Japan's Seibu Prince Hotels Worldwide announced that it was acquiring Ace Hotels."

Small boutique hotels attract travelers seeking singular charm and distinctive hospitality. Large hotel chains and private-equity investors are increasingly acquiring boutique brands and booking platforms, blurring the line between independent properties and corporate ownership. Examples include Mr & Mrs Smith's acquisition by Hyatt and Seibu Prince Hotels Worldwide's purchase of Ace Hotels. Corporate affiliation can ease booking and enable rewards-program integration for loyal travelers, expanding options within loyalty ecosystems. Concerns persist that corporate sales may dilute the unique character that defined boutique properties. Market consolidation in the boutique-hotel sector appears likely to continue.

Read at InsideHook