College and university markets can be great locations for boutique hotels, but there are challenges to operating an independent property near campus.
REPORT FROM THE U.S.—Colleges and universities host a variety of guests on campus, including parents, potential students, educational speakers and sports rivals. And for boutique hotels in college towns, those guests sometimes translate into hotel guests.
While boutique hotels in college and university towns don’t always see periods of booming business, they do enjoy consistent business from the nearby college or university, said Michael Tall, president and COO of Charlestowne Hotels.
Charlestowne worked with AJ Capital Partners to develop its first six properties under Graduate Hotels, Tall said, which are located in major university markets, and smaller towns like Oxford, Mississippi, and Athens, Georgia. The company also manages the Inn at Carnall Hall at The University of Arkansas in Fayetteville, Arkansas.
“What we find in these markets is that they tend to be pretty consistent, very even growth, whereas a lot of markets tend to boom and bust, but university markets tend to be steady,” Tall said. “They’re fairly well insulated from significant external events that tend to impact the hotel industry and other types of markets. … If there were a financial downturn or something like that, university markets tend to be somewhat immune because universities don’t stop operating … or reduce their enrollment when there’s an economic downturn. In fact, sometimes, it’s quite the inverse. A lot of people choose to go back to school during downturns.”
Boutiques in university markets tend to bring in a lot of business from the school during the week, but some are able to bring in wedding business on weekends.
“At all of the university-centric, college markets where we have hotels, the wedding business has been tremendous,” Tall said. “There’s a real affinity by alumni to come back to their college town to get married, particularly when both the bride and the groom went to the same university or college and they met there.”
Hotel Capstone is located right on the University of Alabama’s campus in Tuscaloosa, Alabama. Barry Carden, the hotel’s GM, said the property attracts a lot of corporate groups who visit the university for business.
Hotel Capstone also books a lot of guests because of the University of Alabama’s football team, said Ashley Russell, sales and catering manager at the hotel. The hotel hosts the football team for home games as well as visiting teams. She added that a lot of fans want to visit or stay at the hotel because they know the Alabama Crimson Tide football team stays there.
Carden said the hotel staff has to be aware of what’s happening on campus when it comes to planning events at the hotel.
Keeping business local
The Hotel Casa 425 + Lounge in Claremont, California, isn’t located on a college campus, but it is walking distance from the five Claremont Colleges, GM Tara Naughtin said.
Most of the business brought in by the colleges to the hotel is from prospective students and their families staying in town for campus tours, as well as alumni and visiting parents of students enrolled at the colleges, Naughtin said.
There are benefits and challenges that come with operating a hotel near a college campus, Naughtin said. It’s nice to create a relationship with parents, she said, and many become repeat guests at the hotel. Most guests who are visiting for college tours are on tight schedules, which can sometimes be a challenge because they don’t have as much time to explore the city.
Naughtin said the average length of stay for guests who are visiting the colleges is “at least two nights on an average day.”