Provenance Hotels targets ‘creative class’ across US
Provenance Hotels targets ‘creative class’ across US
25 JULY 2018 12:25 PM

Provenance Hotels is looking to grow its footprint across the U.S., targeting markets with people who are ahead of the trends.

REPORT FROM THE U.S.—Provenance Hotels is known for its unique independent hotels in the Pacific Northwest, a region which eight of its 11 open hotels call home. Now the company is ready to further explore the rest of the United States.

The company has always taken a methodical approach to its growth, sometimes to its detriment, said Bashar Wali, principal and president at Provenance Hotels. In the last five to seven years, there have been a number of independent hotel companies that followed the branded approach and rolled out some great properties, he said, but the terms “boutique” and “lifestyle” have become diluted to some extent due to overuse.

“I believe independent is the world that describes us best,” he said. “Each hotel is unique in its own right. … There is no other like it.”

The more a hotel is individually tailored, the more difficult it is to crank out volume, he said, which has held back the company’s growth pace.

Looking to grow
Originally, Provenance Hotels was a real estate holding company, focusing on markets mostly west of the Rocky Mountains, Wali said. The company owned hotels up and down the West Coast, and as it moved to hotel management, focused initially on boutique hotels and revised its geographic scope to markets it knew best, he said.

“What precipitated our desire to go out of our region was we found we had a formula that resonated with the kinds of populations we’ve seen in the cities we’re in: Portland and Seattle,” he said.

Calling this population “forward-thinking creatives,” he said this type of people is usually ahead of the trends.

Provenance first tested the waters outside of its region with The Old No. 77 Hotel & Chandlery in New Orleans and the Hotel Preston in Nashville, Tennessee. Wali called these unorthodox markets that have their own enclaves.

Provenance recently opened the Lora in Stillwater, a suburb of Minneapolis, which is full of creatives, he said.

Every city in the U.S., no matter how big or small, has a creative class, Wali said. Everyone wants to experiment and try new things, and the rise of the creative class in the U.S. opens up new market possibilities, he said. A town one art gallery might offer better exposure than one with 1,000 art galleries, he added.

“We don’t discriminate based on location,” he said. “It has to have critical mass for the demand. For 10 rooms and 20 rooms, the canvass is substantially larger to do those things on a more scaled approach.”

New properties
Provenance opened the 40-room Lora in Stillwater, Minnesota, on 18 June, and the property has benefited from the influence of Minneapolis’ creative class through the arts, creators and food scene, Wali said.

The property is a turn-of-the-century, 1800s-era building that was the first temperature controlled brewery in the state, and was carved into the side of a hill, with caves and a freshwater spring in the back, he said.

“It was such an incredible canvass,” he said.

Provenance sees the value of having a smaller-scale property that allows for a more handcrafted approach, Wali said. Smaller hotels allow for some creativity and take customization to the next level, he said.

Seen as an escape from the big city during the 1950s and 1960s, Palm Springs has evolved tremendously over the last decade, Wali said. Provenance’s upcoming yet-to-be-named property there is different from the competition, in that it will combine a 32-room hotel and another seven-room hotel that are across the street each other, he said.

“We’re not operating it like a traditional, boring hotel,” he said. “We’re trying to do a different model. When you come to our house, we’ve invited you in. Have a seat, have a drink, we’ll find out who you are, what makes you tick and then worry about checking you in.”

The idea isn’t to reinvent the hotel wheel, he said, but it is about trying a different way that is consistent with how people live.

“It’s not about the road warriors,” he said. “It’s about someone seeking human interaction who wants to sit with you and talk with you.”

Provenance also has hotels in the works in Hermosa Beach, California; Madison, Wisconsin; and Milwaukee in various stages of the design and entitlement phases.

The upcoming Woodlark set to open in Portland in October will be Provenance’s sixth in the market. One of the challenges in the market is there is no lack of incredible offerings across the spectrum, Wali said.

“We think we are trying to find ways to stand out from the crowd,” he said. “We don’t want to do it by making you, our guest, work hard. We try to do it in thoughtful and creative ways that don’t interfere with your experience.”

The Woodlark is actually two historical buildings brought together, which was easier than having a brand new building with a new soul, he said. As there is a plethora of offerings in the market, the company is pursuing “thoughtful, intentional and effortless ways to stand out among the herd,” he said.

Provenance is concerned about Portland’s unbalanced supply and demand, Wali said, as the market’s appeal as a destination has created a herd mentality among hotel companies. He said he can’t imagine the company taking on another project in this market after The Woodlark is opened.

“If someone has to throw keys back to the bank, I might look at those,” he said. “We are not adding a singular room to the market for the foreseeable future. It’s a mile-wide but an inch-deep demand generator.”

Seattle is a broad market that is substantially growing, so he is interested in more opportunities there, he said, adding the company has developed a winning formula.

“There’s a tremendous opportunity to take this formula and roll it across the country in primary, secondary and tertiary markets,” he said.

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