Wyndham Hotels & Resorts is making significant inroads into Europe and the Middle East via a strategy of organically growing its 20 brands into new and existing markets, a plan that will include the La Quinta brand.
BERLIN—Wyndham Hotels & Resorts is significantly growing its portfolio in Europe and beyond, according to Dimitris Manikis, president and managing director, Europe, Middle East and Africa.
An organic strategy will include a push to grow its La Quinta brand in Europe, Manikis added.
“We will be bringing La Quinta into Europe,” he said. “We paid a lot of money for it, and we need to make the return.”
Wyndham bought parent company La Quinta Holdings in January 2018 for $1.95 billion. The brand has approximately 870 properties, all of which are in the Americas, with only 16 outside of the U.S.
In the Middle East, Saudi Arabia is one of the company’s targets for La Quinta development.
Speaking to Hotel News Now at the recent International Hotel Investment Forum, Manikis said challenges to growth vary from currency fluctuations to securing labor, well-priced debt and quality assets.
“Also, distressed assets are no longer available,” Manikis said.
“Brand awareness is a key objective of ours,” Manikis said.
He said such endorsements take time to seep into consumers’ consciousness but that the company has made much progress despite being, in Manikis’ words, “a young company,” referring to its 2006 spinoff from Cendant Corporation.
“We have not done too badly,” Manikis said. “We are in 80 countries, the No. 1 franchisor, but how do we make Wyndham more widely known? By always promoting the mothership. The more we grow the easier it gets.”
Working with owners
Conscious of the changes in capital coming into the European franchise market, Manikis said working with owners remains the most critical part of the growth picture.
“I am client-obsessed. I want to add more of this,” he said. “Meet all the owners, answer all the phone calls, all the emails. Seven to 10 years ago it was private equity and family offices. Now (we) are seeing more institutional capital interested in portfolios, but whether owners have 100 properties or one, the attention must be the same.
“The only thing that can change is how (owners) look at you. We must understand everyone’s objectives.”
Manikis said there’s some inherent risks in investing in Europe, but they can pay off.
“Our desire for scale might well mean having more skin in the game, and as operators that creates a different landscape. You have to be careful,” he said. “Again, it is about understanding the market and investors’ requirements.”
In Europe, another complication is that new brands are popping up every month.
“There are so many brands, so every day we must add value,” Manikis said.
Pins in the map
Europe offers Wyndham huge opportunities for all its brands, not just La Quinta, Manikis said.
New and expanded markets include Georgia, neighboring Armenia, Turkey, the southeast Mediterranean and the Benelux countries, to name a few.
“We’ve just announced Nicosia (Cyprus) and one in Crete, our first on the Greek Islands,” he said. “And watch the (Commonwealth of Independent States) in the next few months.”
Some of those openings will be for the firm’s upper-upscale brand Wyndham Grand, Manikis said.
Outside of Europe, Manikis said developers have been hired in Africa, and added that Saudi Arabia offers a “mind-blowing opportunity.”
Manikis believes Wyndham is poised to grow dramatically across the Europe, Middle East and Africa region.
“In Saudi Arabia, I think the economy market will blow everyone out of the market,” he said. “And we have 20 brands to offer its markets.”