Boutique hotels continue to increase in new openings within differing price points from upper midscale to luxury class as the segment consistently performs with solid occupancies and healthy average rates, according to a Highland Group report. Recent acquisitions of independent boutique collections, including those by Wyndham, Hyatt and Hilton, add to more franchised offerings of this product type.
Based on data in The Boutique Hotel Report 2024, most boutique segments finished with higher average rates in 2023 compared to same class of U.S. hotels. Some segments were higher by a large margin. Luxury boutique hotels finished strong while stabilizing rate growth.
“The significance of the boutique hotel is recently seen through the number of small, suburban town centers exploring adding this product type to entice vibrancy and curiosity for their immediate area," Kim Bardoul, partner at The Highland Group, said in a statement. "A well-done boutique hotel, while serving a town with unique accommodation, offers a sense of place if adeptly immersed into the vibe and history of the local community, and provides an appealing location for guests and locals to gather."