Carlson Rezidor is looking to capitalize on the expanding North American select-service sector by launching Radisson Red, its first new North American brand in more than a quarter-century.
The Minnesota-based hotelier will also launch a luxury soft brand called Quorvus Collection, which will target Asia-Pacific and Europe and, apparently, mirror the approach Starwood Hotels & Resorts is taking with its Luxury Collection.
Both Carlson brands will debut as early as next year.
Radisson Red will be what Carlson Rezidor calls a "lifestyle select" brand, combining modernist design and a technology emphasis with a select-service operations setup. The company is eyeing as many as 60 Radisson Red hotels worldwide by the end of the decade.
While the company wasn't specific with its prospective locations, North America will be the primary focus, according to Gordon McKinnon, Carlson's chief branding officer, who mentioned cities such as Minneapolis and Austin, Texas, as likely candidates for some of the brand's first hotels.
The two new brands, and specifically Radisson Red, reflect how the 76-year-old company is gearing up for North American growth after spending the past couple years largely in reorganization mode.
Carlson became the majority stockholder of European hotelier Rezidor in 2010 and officially merged with the company to become Carlson Rezidor Hotel Group in early 2012. Later that year, Carlson tapped longtime executive Trudy Rautio to succeed Hubert Joly as the company's president and CEO after Joly stepped down to become CEO of electronics retailer Best Buy.
Since then, Carlson Rezidor has focused on bringing its European Radisson Blu upscale brand stateside, while the company is about four years into a five-year plan in which its North American properties received about $1.5 billion in upgrades.
Chicago's Radisson Blu Aqua, the first domestic property under the brand, opened in October 2011, while Radisson Blu properties opened at the Mall of America in Bloomington, Minn., and in Philadelphia last year.
While McKinnon declined to say which specific brands Radisson Red would take on, he estimated that a typical hotel would be about 150 rooms and said the first properties would most likely be newbuilds. Among those hotels' attributes will be a modernist design and the ability for guests to check in to their rooms via smartphones without going to the front desk.
Meanwhile, the company's Quorvus Collection will be a group of five-star hotels with an emphasis on more traditional architecture and guest wellness. Carlson Rezidor said it would announce the first members of the Quorvus Collection by June and was looking to have 20 hotels within that group by 2020.
Carlson Rezidor is committing more resources to a select-service sector that has kept pace with the rest of the U.S. market and a luxury sector where demand continues to outpace it. With U.S. hotel revenue per available room (RevPAR) increasing 5.4% last year, select-service hotel RevPAR was up 5.3% while RevPAR at luxury hotels jumped 7.6%, according to Smith Travel Research.
Carlson hasn't introduced a North American brand since debuting its Country Inns & Suites badge in 1987.
Radisson Red, which is likely to compete most closely with Marriott's Courtyard and the Hilton Garden Inn badges, faces the challenge of being relatively late to the game when it comes to the select-service sector, said Mark Eble, Chicago-based regional vice president of consultant PKF Hospitality. He added that launching a luxury brand like the Quorvus Collection is "the hardest thing to do in the hotel business."
Still, judging by Radisson Blu Aqua, Carlson Rezidor's efforts to change its hotels' perception in North America are commendable.
"That hotel is spectacular," Eble said. "If you walk in expecting a Radisson, your socks will be removed."