Massive market beckons for
contractors, developers building
all-suites hotels, say Hilton executives
Canadian Design and Construction Report
staff writer
There’s increasing demand and a largely untapped mar-
ket for all suites hotels in Canada – and Hilton Hotels and
local developers are creating an impressive pipeline of op-
portunities for designers and builders who can combine
speed, quality and cost-effectiveness in their construction
processes. These achievements were reflected at the grand open-
ing ceremonies for the Home2 Suites hotel in Brampton,
the first in the Greater Toronto Area and one of the first in
Canada, which shares a site with a Hilton Garden Inn. Both
properties are owned by developer JM Hospitality, which
is preparing to build even more hotels including a “triple
branded” site at an as yet undisclosed location within the
Greater Toronto Area.

Hilton officials say the hotel currently has nine all-suites
hotels in the pipeline in Ontario, with an additional six ho-
tels in other provinces. The hotel organization is cautious
about revealing specific details about upcoming projects
to protect commercial confidentiality, but the numbers –
and potential additional projects – indicate a multi-billion
dollar opportunity for designers and contractors.

“It’s been a very robust market and in Canada, we see a
tremendous amount of growth on all levels, especially in
the all suites category,” said Alan Roberts, global head of
Embassy Suites by Hilton.

“In the U.S., the all-suites category represents about 16
to 20 per cent of the marketplace in terms of inventory,”
he said. “In Canada, it was 6 per cent five years ago – but
that number is now closer to 4 per cent, as we’ve added
more transient hotels and diluted that number.

“So it creates a real opportunity in the all suites space,”
he said.

Hilton has developed three brands in the category. Em-
bassy Suites serves the high-end market, with full hotel
services coupled with the all-suites design. The next cate-
gory is Homewood Suites, that takes a middle ground.

Home2 Suites serves the budget end of the market – but
the new Brampton hotel certainly does not convey an
image of cheapness.

The suites are spacious, bright, and have amenities and
features designed to appeal to someone who will be mak-
ing the hotel room into their home away from home, in
many cases for a week or two. There’s even a cupboard
on the wall where visitors are encouraged to set up their
own personal artwork and displays.

Hilton managers at a media round table in early July
made clear that they don’t dictate to hotel developers
CAPITALIZING ON
CANADIAN OPPORTUNITY
With tourism to Canada reaching record levels in 2018, ROI for hotel development is high.

21.1 MILLION
4.4%+ 3.2%+
VISITORS AVERAGE DAILY RATE
REVENUE PER
AVAILABLE ROOM
SOLID ROOTS IN CANADA
135+ open hotels under
Hilton brands
OVER 20%
4,000+ 21
5 of open Hilton
properties are an
All Suites brand
suites 4
THE ALL SUITES CATEGORY’S
FUTURE IS BRIGHT IN CANADA
21% of the Hilton pipeline in
Canada is comprised of
All Suites properties
14 *
Pending All Suites
properties *Includes planned hotels and properties under construction.

8 – Summer/Fall 2019 — The Canadian Design and Construction Report
Source: Destination Canada
https://www.destinationcanada.com/sites/default/files/archive/851-National%20Tourism%20Indicators%20-%20Q4%202018/National%20Tourism%20Indicators%20-%20Highlights%202018.pdf Source: Destination Canada
https://www.destinationcanada.com/sites/default/files/archive/814-Tourism%20Infographic%20-%20November%202018/Nov2018-Infographic_EN.pdf Source: Travel Market Report
https://www.travelmarketreport.com/articles/Canada-Tourism-Expected-to-Strengthen-in-2019 Source: Destination Canada
https://www.destinationcanada.com/sites/default/files/archive/821-Tourism%20Snapshot%20-%20November%202018/TourismSnapshot-Nov2018_EN.pdf



which designers, contractors
and subtrades to use, though
they will make recommenda-
tions and warn owners of poten-
tial problems if they’ve had bad
experiences in the past.

Hotel construction requires
both speed and quality control;
the longer it takes to build the
hotel, the less revenue the oper-
ator can earn, while increasing
carrying costs. As well, since
hotels are often built to tem-
plates with standard room types
and sizes, they can be among
ideal candidates for efficient
modular construction. In fact, a
Home2Suites in San Francisco
area is the first modular-built
hotel in the area.

The Home2 Suites in Bramp-
ton was constructed with “total
precast” technology and its
completion was incredibly quick
– about 30 days.

While Hilton wouldn’t discuss
the actual construction costs or
project value, one manager said
“we’re looking at about $200 a
square foot in hard construction
costs.” Of course, there are land costs and other ex-
penses – and these will vary by location.

Hotel management/brand companies and developers
seek to develop symbiotic relationships; the hotel brand
collects management fees and ongoing revenues, while
the developer benefits from the hotel company’s brand
recognition and operating systems. Since Hilton has sev-
eral different brands serving different categories, devel-
opers can (depending on the site), combine more than
one brand on the site with common facilities and ameni-
ties. merk@merx.com
(The Home2 Suites and Hilton Garden Inn in Brampton
for example share a common convention/meeting area.

While the Home2 Suites offers a free breakfast for
guests, if they want to eat a more substantial evening
meal or have a drink, they only need to walk down the
corridor to the restaurant at the Hilton Garden Inn.)
Overall, Hilton says it has 65 Hilton properties under
construction across the country, in the various categories,
including Waldorf Astoria, Conrad, Hampton Canopy and
Tru. Internationally, the company would like to open 100
Home2 Suites properties every year, and could have
1,000 by 2025.

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The Canadian Design and Construction Report — Summer/Fall 2019 – 9