yyzer
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Toronto, Calgary next targets for Opus boutique hotels
Room rates at Vancouver site average $329 to $339 per night
With Vancouver and Montreal now covered, Opus Hotel owner John deCourcey Evans has his sights on Toronto and Calgary to complete a Canadian quartet of upscale boutique hotels bearing the Opus brand.
Evans' Trilogy Properties bought the three-year old Hotel Godin in Montreal last month and changed the 136-room property's name to Opus Montreal -- five years after the first 96-room Opus Hotel opened in Yaletown.
Evans said new Opus hotels in Toronto and Calgary are the next obvious goals because those are the markets that can afford the rates Opus needs to run five-star boutique properties. He expects Opus Vancouver will achieve average room rates of $329 or $339 this month.
"The top-performing properties in the hotel industry today are boutique properties," Evans said in an interview. "It's an entirely different business when you fill just 90 rooms a night, rather than 400. It's all about rate so we won't sacrifice rate for revenue."
Trilogy entered the hotel management business almost by accident in 2002 because the Yaletown property was supposed to be a limited partnership operated by U.S.-based Kimpton Hotels.
But the units didn't sell out so Trilogy scrapped those plans and took over the property ownership and management itself. Five years later, it sees itself as a national brand.
"In the U.S., many one-off boutique hotels have become global brands and expanded their operations," Evans said. "Given the awareness of our brand, we have an opportunity to do the same thing."
He mentioned the 60 Thompson Hotel in New York -- which recently bought the Roosevelt Hotel in Los Angeles -- and the Mondrian Hotel in Los Angeles as examples of individual hotels that have expanded into national brands.
Evans prefers to build new hotels but made an exception with Montreal because it was a unique opportunity to expand quickly into a vibrant market. He said the hotel suffered from not having liquor licences in place from the outset and it was taken over last year by its lenders -- the Caisse de depot et placement du Quebec.
Evans wouldn't reveal a purchase price but said it was less than the estimated hotel replacement cost of $35 million. Opus Vancouver was a $24-million project and Evans said future Opus hotels will likely be financed by non-Canadian lenders.
"It's hard to finance hotels in Canada because chartered banks here are quite risk averse and only in the market in a limited way," he said. "U.S. lenders are more open to getting involved in the Canadian hotel industry."
Evans feels true boutique hotels can't have more than 150 rooms because they lose their intimacy if they become any bigger. He also feels they should be stand-alone properties, not 10 floors of a 40-storey highrise, and he has scoured the Calgary market unsuccessfully for two years now looking for a great building site.
Evans said four Opus hotels in Canada would be enough because he's not looking for economies of scale. Each property has to work on its own.
He feels it's a great time to expand in the Canadian hotel sector because the economy is strong and the country continues to attract many high-end international travellers. The high Canadian dollar has hurt U.S. traffic to Canada, but Evans feels that trend can be overcome.
"We have to change the thought that you only come to Canada because it's a good deal," he said. "You have to come to Canada because it's a world-class experience and we're going to charge for it because we're not a discount destination."
So could there ever be an Opus property in the U.S.? "I guess you never say never," Evans said.
Room rates at Vancouver site average $329 to $339 per night
With Vancouver and Montreal now covered, Opus Hotel owner John deCourcey Evans has his sights on Toronto and Calgary to complete a Canadian quartet of upscale boutique hotels bearing the Opus brand.
Evans' Trilogy Properties bought the three-year old Hotel Godin in Montreal last month and changed the 136-room property's name to Opus Montreal -- five years after the first 96-room Opus Hotel opened in Yaletown.
Evans said new Opus hotels in Toronto and Calgary are the next obvious goals because those are the markets that can afford the rates Opus needs to run five-star boutique properties. He expects Opus Vancouver will achieve average room rates of $329 or $339 this month.
"The top-performing properties in the hotel industry today are boutique properties," Evans said in an interview. "It's an entirely different business when you fill just 90 rooms a night, rather than 400. It's all about rate so we won't sacrifice rate for revenue."
Trilogy entered the hotel management business almost by accident in 2002 because the Yaletown property was supposed to be a limited partnership operated by U.S.-based Kimpton Hotels.
But the units didn't sell out so Trilogy scrapped those plans and took over the property ownership and management itself. Five years later, it sees itself as a national brand.
"In the U.S., many one-off boutique hotels have become global brands and expanded their operations," Evans said. "Given the awareness of our brand, we have an opportunity to do the same thing."
He mentioned the 60 Thompson Hotel in New York -- which recently bought the Roosevelt Hotel in Los Angeles -- and the Mondrian Hotel in Los Angeles as examples of individual hotels that have expanded into national brands.
Evans prefers to build new hotels but made an exception with Montreal because it was a unique opportunity to expand quickly into a vibrant market. He said the hotel suffered from not having liquor licences in place from the outset and it was taken over last year by its lenders -- the Caisse de depot et placement du Quebec.
Evans wouldn't reveal a purchase price but said it was less than the estimated hotel replacement cost of $35 million. Opus Vancouver was a $24-million project and Evans said future Opus hotels will likely be financed by non-Canadian lenders.
"It's hard to finance hotels in Canada because chartered banks here are quite risk averse and only in the market in a limited way," he said. "U.S. lenders are more open to getting involved in the Canadian hotel industry."
Evans feels true boutique hotels can't have more than 150 rooms because they lose their intimacy if they become any bigger. He also feels they should be stand-alone properties, not 10 floors of a 40-storey highrise, and he has scoured the Calgary market unsuccessfully for two years now looking for a great building site.
Evans said four Opus hotels in Canada would be enough because he's not looking for economies of scale. Each property has to work on its own.
He feels it's a great time to expand in the Canadian hotel sector because the economy is strong and the country continues to attract many high-end international travellers. The high Canadian dollar has hurt U.S. traffic to Canada, but Evans feels that trend can be overcome.
"We have to change the thought that you only come to Canada because it's a good deal," he said. "You have to come to Canada because it's a world-class experience and we're going to charge for it because we're not a discount destination."
So could there ever be an Opus property in the U.S.? "I guess you never say never," Evans said.
