TORONTO—When the Delta Hotels and Resorts brand was owned by Fairmont Hotels & Resorts, it languished in the shadows because it was only the company’s No. 2 focus, according to Kenneth Greene, who stepped into the role of president and CEO of the hotel management company in September.
“It didn’t get the right branding attention that was needed,” he said.
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Kenneth Greene Delta Hotels and Resorts |
However, after the brand was sold in 2007 to British Columbia Investment Management Corporation, Delta Hotels was able to flourish.
The brand portfolio now includes 40 properties, of which 31 are managed and nine are franchised. Of the 31 that are managed, 10 of them are owned assets.
And the added attention is helping to reposition Delta into one of Canada’s top brands, Greene said.
“The strategy is to reposition Delta as the best 4-star, full-service brand in Canada. We’re on our way to do that.”
A focus on design
This starts from a design perspective with the initiation of the ModeRoom prototype—a “tech-savvy, thoughtfull,y innovatively designed room that really adapts to the needs of guests rather than have guests adapt to us,” Greene said.
Delta was not able to disclose the cost going into property renovations, but a significant investment was made with the help of third-party owners. Delta is investing its own funds to renovate its corporately held assets.
After a tremendous amount of guest research, Greene said guests were unanimous in what they wanted: comfort and connectivity. The desk is sleek and clutter free, the bathroom is a “spotlight design,” with no amenities on the vanity but on a separate shelf. And the room is adorned with many electrical outlets for guests’ mobile needs.
“We need to adapt to what guests want, and guests shouldn’t have to come to our rooms and adapt to what we’re offering. We should have it ready for them in today’s world.”
These value adds are only one arm of Delta’s two-pronged approach. Before guests can be attracted to technological advancements and chic decor, the property itself has to be above standards and in the right marketplace, Greene said.
Brand repositioning
Greene said much of his time when he started at Delta was spent evaluating the company’s presence on the Canadian hotel landscape. Some hotels were sold, others were purchased and Greene also considered adding new builds to the mix.
“In Ottawa, we owned a property and we sold it; it was not the right presence (for) us,” he said. “We acquired another property and renovated that property.”
Greene declined to disclose how many hotels were sold, or the sale price.
Recently, the company parted ways as management company with Canada’s largest hotel, the Delta Chelsea in downtown Toronto for an undisclosed price, making evident Delta’s commitment to its new brand repositioning.
However, the two-year plan falls on the shoulders of the construction of a 45-story property in Toronto, scheduled to be complete in November 2014.
“It will be a flagship,” he said.
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With plans to open in late 2014, Delta Hotels & Resort 45-story downtown Toronto hotel will be its flagship property. |
The basic strategy is to go marketplace by marketplace, seeking out “A” locations to encourage Delta’s rebranding as the “best 4-star, full-service hotel in the marketplace.”
The properties that already have been renovated are seeing significant increases across the board in occupancy, average daily rate and revenue per available room.
“As you renovate a property fully, you would expect to get a (return on investment) on that,” he said. “That’s what we’re trying to do.”
Greene said Delta’s strategy is to continue to renovate properties, introduce the ModeRoom, close the product quality gap and be consistent across Canada.
“At that point, after two years, we’ll talk about strategy to grow in different ways. There are a variety of different growth strategies to consider or review.”
Targeting Asian travelers
Delta’s strategy will eventually focus on the Asian traveler, Greene said.
For one thing, “Canada is one of those places that will benefit … from the growth that will happen in Asia,” he said.
“As domestic travelers in China and India start to become global travelers, our hope is that when they come to Canada, Delta gets more than its fair share.
“We’re already good at service culture,” he said. And making people feel comfortable and at home no matter where they come from is “important as we move forward in this business,” he said.
Future growth
Another aspect of Delta’s strategy involves buying properties, as well as affiliating with the right third-party owners for management or franchising opportunities.
“The best way to grow is to grow with third-party owners that believe in the brand and invest in the brand and represent the brand in the right way,” he said.
Canada offers an abundance of opportunities for growth, especially with its scenic views and natural landscape. And for Greene, staking a strong claim in the company’s home country is more important than expanding beyond the Canadian borders.
Once Delta’s repositioning and renovations are accomplished in Canada, Greene and his team will brainstorm the company’s five-year plan, which is still being finalized.
But there is an upside to this steady, wait-and-see approach.
“We’re not a public company so we have the ability to execute short-term strategy for long-term growth.”