Unlike most major hospitality players, Omni Hotels & Resorts has eschewed the franchise model. The privately held company owns and manages the majority of its 60 properties across North America and plans to double down on this strategy as it continues to grow. Omni's pipeline includes plans for new hotels in Boston, Oklahoma City and Tempe, Ariz., as well as major redevelopments of its Omni Barton Creek Resort & Spa in Austin, Texas, and Omni Mount Washington Resort in New Hampshire, among others. Hotels editor Christina Jelski sat down with Omni president Peter Strebel to discuss the group's expansion plans.
Q: How will the Boston, Oklahoma City and Tempe properties enhance your portfolio?
A: We're predominantly a groups company. About 60% of our business is meetings and conventions as well as incentives. Our convention-focused hotels include Nashville, Atlanta and others, and Boston and Oklahoma City will join that list when they open two years from now. The largest project we have under construction is in Boston, which hasn't seen a new, big luxury hotel project in years. The Omni Boston Hotel at the Seaport will be across the street from the Boston Convention Center and have over 1,000 guestrooms. In Oklahoma City, our property will be in proximity to a new convention center. Oklahoma City is just on fire, so it's an exciting project. Our Tempe hotel, meanwhile, will be on the Arizona State University campus.
Q: Though meetings and conventions are a major part of the business, are you seeing any upside for Omni on the leisure front?
A: We generally attract strong leisure business on weekends, because we aim to make our properties a destination. We program our hotels with restaurants, a spa and other amenities to be very leisure-focused. Leisure business is strong, and people are taking more short trips, which is great for us. Statistics show that the younger generation prefers to travel frequently, and they like to go away more often for shorter time periods. That trend fits well with our properties in places like Dallas and Nashville. Even though they're in business districts, they sell out every weekend.
Q: What's the update on your renovation projects?
A: We closed our Barton Creek golf resort a few months ago for a $150 million redevelopment. It's going to have seven restaurants, a new spa, three pools and will really be the most luxurious Texas golf resort. It'll reopen in May. With Mount Washington, we're adding guestrooms and reconceptualizing the food and beverage. For example, many of these grand old hotels have these massive, beautiful, formal dining rooms, but people don't want formal dining anymore. We're switching to a big bar-centric restaurant, which will open next year. We're also about to launch an $80 million redevelopment of our Omni Homestead Resort in Hot Springs, Va. It was built in the 1700s, so a lot will go into updating the mechanicals.
And next month, we're reopening our Houston hotel, which closed after major flooding from Hurricane Harvey. We've invested $30 million and reconceptualized the entire hotel with a new lobby, new restaurants, new bar and new ambience.
Q: With brand proliferation at an all-time high, what's your view on the current competitive climate?
A: Managing a brand is an expensive venture. I think some of these new brands that aren't clearly defined and don't own their own unique space have an uncertain future. At the same time, everyone's merging together and getting bigger. We saw a similar scenario play out in the '70s, but then it broke apart and everyone wanted to be smaller. I think in 15 years, the hotel business will look very different. Will it all come back to owning real estate? I don't know. A lot of these REITs [real estate investment trusts] that own real estate popped up because of tax advantages. If a new president comes in and changes tax laws, companies may have to find a different model.
Q: Has Omni ever considered launching another brand?
A: We have considered it. We have a spa brand called Mokara. And one of our hotels is actually branded under that name -- the Mokara Hotel & Spa in San Antonio.
The San Antonio Mokara is one of the highest-rated hotels in that market, so we have looked at potentially developing that brand.