Choice Hotels (CHH) Reports Exemplary Unit Growth in 2023
Choice Hotels International, Inc. CHH announces robust brand expansion, surpassing growth expectations across its high-revenue segments in 2023.
The company reported a 1.4% year-over-year increase in affiliated hotels in its upscale, midscale and extended stay brands within the domestic market. The upside coincided with the seamless integration of Radisson Hotels Americas brands, contributing to overall success. The expansion of Choice's original brands resulted in a nearly 2% rise in domestic properties within the lucrative segments and a 2.6% increase in international portfolio hotels.
In the extended stay sector, Choice Hotels solidified its leadership by opening a record 61 hotels and expanding Everhome Suites to 66 properties. The upscale segment reported growth with the introduction of 19 new properties in the Ascend Hotel Collection. Successful migration of Radisson Americas hotels to CHH's reservation system resulted in an impressive 8% year-over-year increase in Revenue per Available Room (RevPAR) for the Radisson brand. CHH's effective revenue-intense strategy and the successful integration of Radisson Americas brands generated substantial digital traffic and bookings.
Cambria Hotels expanded to 74 properties, while core brand growth included 33 new Comfort hotels, 35 Quality Inn openings and the introduction of a modern Sleep Inn prototype.
Internationally, Choice Hotels broadened its global reach by renewing the master franchise agreement with Strawberry, forming a distribution partnership with the Spanish hotel chain Sercotel and securing franchise rights for City Edge Apartment Hotels in Australia. It completed the successful integration of Radisson Americas hotels in the Caribbean, Canada and Latin America. CHH is actively committed to fostering growth for the legacy Radisson Americas brands in these regions in the coming year.
President and CEO Pat Pacious expressed enthusiasm about the transformative growth and emphasized the commitment to enhance brand value in diverse market segments in 2024. CHH plans to leverage its business delivery engine to enhance partner businesses further. It aims to reduce costs and increase revenues for franchisees.
CHH is firmly positioned to advance its development growth and performance in 2024. It intends to leverage its hotel conversion proficiency, facilitating the rapid advancement of properties through the pipeline and delivering substantial value to new owners. The company emphasizes collaboration with Zenitude Hotel-Residences to enhance its footprint in France by adding 33 properties between 2024 and 2025. As of the end of 2023, the company disclosed a global pipeline comprising 1,032 properties.
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In the past three months, shares of Choice Hotels have dropped 1% against the industry’s 16.6% growth.
Zacks Rank & Key Picks
Choice Hotels currently carries a Zacks Rank #3 (Hold).
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