Deutsche Hospitality’s newly announced fourth brand is a conversion- and franchise-friendly brand that will offer more options to owners who are turned away by the standards of the company’s Steigenberger Hotels and Resorts, Jaz in the City and IntercityHotel brands.
BERLIN—Deutsche Hospitality’s brand umbrella has expanded to a fourth tier with the introduction of Maxx by Steigenberger, officials announced on the second day of the International Hotel Investment Forum.
Claus-Dieter Jandel, Deutsche Hospitality’s EVP and chief development officer, said the brand will sit between luxury brand Steigenberger Hotels & Resorts and the IntercityHotel and Jaz in the City brands, toeing the line between select and full service.
It is the first significant announcement from the Frankfurt-based company since Deutsche Hospitality devised the new brand structure 18 months ago, according to CEO Thomas Willms.
The name Maxx has been used by Steigenberger before, Willms said, but there are no similarities with the new launch, apart from Deutsche Hospitality owning the name.
“It is an upscale brand that will be ideal for conversions and have a more flexible approach to brand standards. We have had the pain of rejecting assets because of our other brands’ strict standards,” Willms said, who added there will still be some codes in place such as minimum room size.
Jandel agreed that Deutsche Hospitality has met some obstacles in the past.
“We’ve missed some great opportunities because some hotels simply could not fit into our existing three brands,” Jandel said.
While no debut Maxx hotel was announced along with the brand launch, Willms said Deutsche Hospitality will likely open its first Maxx property in its home country of Germany, where they foresee significant room for growth.
“Seventy percent of Germany is still unbranded,” Willms said.
Willms added the brand would be franchise- and conversion-friendly, be flexible in room count, room size and design depending on location. Deutsche Hospitality executives also are not adverse to owners retaining their property’s name, although there would likely be a “by Maxx by Steigenberger” suffix added on.
“We have had discussions with owners, but they said, ‘Please launch the brand first,’” Willms said.
Jandel added the first property would be announced in 2018.
“We should have a good number announced this year,” Jandel said.
Jandel said that the 88-year-old German company currently is in 18 countries, and growth prospects are promising.
Steigenberger Hotels & Resorts has 60 assets in operation, IntercityHotel has 40 properties open and Jaz in the City—which was created in 2015—has two hotels, one in Stuttgart and another in Amsterdam. Company officials said there are still white spaces for growth throughout Europe.
“We’re not in Italy yet, although Steigenberger was there once, or in Greece, and Eastern European is very important to us,” Jandel said.
Deutsche Hospitality is interested in new hotel development around the globe in locations including Oman and Thailand.
The emphasis is on resorts and urban assets, and the franchisee base will include owners with both individual and multiple assets. Deutsche Hospitality will target resort properties that are within four hours’ flying time from Germany, Jandel said.
But one thing still missing in the company’s brand stable is a budget brand, Willms said.
“When we launched Deutsche Hospitality, we spoke about the need for a budget brand, and I think that is still missing,” he said. “The umbrella nature of Deutsche Hospitality will help us get there.”
Willms added his firm is unlikely to grow in size comparable to AccorHotels or Marriott International.
“We are now four brands, and we have doubled our brand number in a few years, so, no, we will not be at 30 (brands),” Willms said.