WICHITA, KS—As reported yesterday in GlobeSt.com, Value Place, the largest affordable extended-stay hotel chain in the US, just hired Bruce Haase as its new chief executive officer. And the former executive for Choice Hotels International tells GlobeSt.com that it’s a great time to take the helm of a company like Value Place.
“What we’re seeing in the economy is an improving revenue per available room that’s now well above the pre-recession rate,” he says. Furthermore, “we’re also seeing almost no new supply in the industry.”
Value Place has begun making moves that will satisfy the demand for more low-cost extended stay hotels. Company officials recently got a $100 million capital investment from the New York-based investment firm Lindsay Goldberg LLC. It will use the funds to jumpstart the construction of dozens of new projects in metro areas such as Atlanta, Cleveland, Denver, and southeast Florida, among others.
In addition to Haase, the company has also hired a new cadre of top officials to help build up the national brand. Kyle Rogg, for example, was recently brought on board as president and chief operating officer.
A typical Value Place location has about 124 rooms in a four-floor, 45,000-square-foot building on two acres that provides guests with a bedroom, a desk with an internet connection and a full kitchen. The company currently has 189 properties in 32 states, both corporate- and franchise-owned. And it plans to grow its national footprint by increasing the numbers of both types.
“We’re not interested in shifting the brand to one or the other, and we have not decided on an exact number of properties we’re going to develop,” says Rogg.
However, he adds, “we do view the corporate-owned properties as a kind of test kitchen for the brand.” To kick off an expansion in the Atlanta area, Value Place will invest $65 million over the next two years to buy land and build 10 new corporate-owned and operated hotels. “We believe we have a very attractive package for franchise operators,” but the successful establishment of corporate hotels in a particular area will prove that that the Value Place concept works.
“It’s a proven strategy in the business,” says Haase. “We’re in this for the long haul and our equity partners are in it for the long haul. This is a very stable environment and the growth prospects for the company are better than they have been in quite awhile.”
“There are a lot of markets that don’t have a Value Place and our plan is to go after that in a smart fashion,” he adds, “and not have growth for growth’s sake. We’re not going to damage the brand in the process.”
And Rogg says the company is still on the lookout for veteran hotel talent like Haase. “We are building an executive team that can help bring this brand to the next level.”