Luxury Hotel Segment Flourishing
by Michael J. ShapiroMarch 13, 2013
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Demand in the luxury hotel segment is strong, according to both Starwood Hotels & Resorts and the latest figures from lodging data provider STR. From Starwood's luxury General Managers Summit, currently taking place in Dubai, United Arab Emirates, the hotel company announced that the number of luxury properties flying Starwood flags nearly doubled in the last five years to meet growing global demand. The company now has more than 160 luxury properties in 39 countries under the Luxury Collection, St. Regis and W brands. Starwood executives intend to add 50 more luxury hotels in 12 new countries over the next five years. "We are on the cusp of a new golden age of luxury travel as technology and globalization drive new trade routes, capital flows and wealth creation," said Starwood's president and CEO Frits van Paasschen. Luxury properties make up 15 percent of the company's total development pipeline, according to Starwood, and 90 percent of its future luxury properties will open in emerging markets. Eighty-five percent of Starwood's luxury hotel guests represent generations X and Y, the company added. Preliminary February statistics from STR indicate luxury business is up overall in the U.S. The luxury chain scale led all others in terms of performance metrics, with year-over-year occupancy growth between 4 and 6 percent and a revenue-per-available-room increase of between 9 and 11 percent.