Why invest in independent hotels

Of the three types of boutique hotels, independent, lifestyle and soft brand, independent hotels make up the largest number of hotels. To get an understanding of the boutique segment, take a look at the breakdown of the boutique hotel sector according to The Boutique Lodging Report 2020:

A true independent hotel is one that is free from national brand affiliation. This hotel model is the most difficult to manage and offers the most reward to those we can successfully navigate running a successful operation. 

Savvy independent hotel investors have reaped the rewards of zero franchise fees all while enjoying occupancy and rate premiums of independent hotels. These investments also enjoy being pillars of their neighborhoods, cultural icons, central meeting points and an opportunity to share the story of the city in which it resides.

These pillars of their communities don’t just enjoy a rate premium, but also much higher Food & Beverage revenues as well for total revenue per available room of over $330. Mostly due to their exceptional occupancy of 78% and high average rates of $274. 

This results in gross operating profit of over $104 per available room. Still not convinced? Take a look at our in depth review of data on boutique hotel profitability with and without chain affiliation.

This investment shift has caused brands to rush to create soft brands like Hilton’s Curio, and Marriott’s Autograph where investors with capable boutique hotel and restaurant management companies can realize lower interest rates and reduced franchise fees.

Our partners repeatedly tell us, “Our operator doesn’t know how to run a boutique hotel. They don’t understand how to create a true boutique experience.” We also hear, “Can you please take over our hotel’s restaurant? The hotel operator doesn’t prioritize F&B, and we know it could be so much better.”

That’s why The Indigo Road Hospitality Group expanded from independent restaurant management to include independent hotel management. By seamlessly integrating boutique hotel operations with exceptional food and beverage experiences, we create memorable stays that set our properties apart. Together with our partners, we ensure that every guest who walks through our doors receives the thoughtful service, authentic hospitality, and elevated experiences they deserve.