At last, Project ECHO is a project no more. Wyndham Hotels & Resorts has finally announced the name of its 24th brand: ECHO Suites Extended Stay by Wyndham.
The brand—first announced during Wyndham’s full-year 2021 earnings call in February and securing the working name Project ECHO (an acronym for Economy Hotel Opportunity) in March—is now officially the fastest growing brand in Wyndham’s development pipeline at 120 hotels as of Sept. 30. The company expects to open its first ECHO Suites hotels in 2023.
“In six short months, ECHO Suites Extended Stay by Wyndham has secured its place as the fastest growing brand in our development pipeline, highlighting continued, robust demand from both travelers and developers for budget-friendly, extended stay offerings,” Geoff Ballotti, president and CEO of Wyndham Hotels & Resorts, said in a statement. “Imagined and designed from day one with the constant input, review and oversight of many of our nation’s most experienced extended-stay developers, ECHO Suites was engineered with one specific goal in mind: creating an ROI-driven prototype that is as cost-efficient to build as it is to operate.”
Chip Ohlsson, EVP and chief development officer at Wyndham Hotels & Resorts, told Hotel Management the brand’s name was meant to evoke returns and repeats—like the team hopes the brand’s guests will do. More importantly, he said, the name resonated with its developers. “[It’s a] very rare circumstance where the project name is becoming the name of the hotel brand,” Ohlsson said. “We normally wouldn't do that. But because the developers loved it, and the consumer feedback we got on it was great, that's where we went with it.”
How to Launch a Brand
Wyndham took an “owner-forward” positioning on the ECHO concept from the beginning, Ohlsson said. “We talked to a lot of owners about the right way to launch—which segment and how to launch in the segment, what the prototype needed to look like [and] what the operations needed to look like.” The extended-stay segment’s successes relative to the overall industry also helped make the brand appealing: “The developers didn't know they needed it until the pandemic hit, and then they saw the opportunity,” Ohlsson said.
The gradual time frame to bring the brand to light was very deliberate, according to Ohlsson. “When you launch a brand, you want to make sure that you don't do it just by saying ‘Hey, today's a great day to be in the extended-stay marketplace!’” he said. “We looked at the segment, we looked at the space, we looked at the prototypes. We looked at the building costs. We looked at how many markets are out there that are underrepresented in that segment. And when putting all that together—that's how you launch a brand.” When a company plans a launch like this, he added, “you better have all your homework done. And that's what we did. We took our time with it to make sure we're doing it in the right timeframe.”
Beyond selecting developers who are already familiar with the extended-stay segment, Wyndham wanted partners who know where the biggest demand for extended-stay is. “We've also worked with some brokers who are identifying markets for us right now,” Ohlsson said. The company also engaged a third-party firm to rate all the sites under consideration to make sure Wyndham is only looking at “top-tier extended-stay markets, so that when the first hotels open, which will be next year, they're opening into the strongest markets in the country.”
The first ECHO Suites broke ground in September as part of an agreement with Dallas-based Gulf Coast Hotel Management. The second and third hotels will break ground today in Sterling, Va., and Richmond, Va., developed by Richmond-based Sandpiper Hospitality. According to Carter Rise, founder and CEO of The Sandpiper Group of Companies, the development firm is planning 27 properties under the ECHO Suites flag.
The decision to partner with Gulf Coast and Sandpiper was “easy,” Ohlsson said. Before announcing the brand publicly or engaging with any owners, the development team spent about a year figuring out ECHO’s prototype and determining what niche it would fill. “And then we brought in about 12 developers, and right at the onset, you could tell the engagement of Sandpiper and Gulf Coast and how they were so excited about the brand, how they believed in the segment, how engaged they were in the operations model [and] the prototype models.” The developers offered feedback on the prototype, and Ohlsson said the Wyndham team was “excited” to refine the product as they determined what would attract their target demographic. Ultimately, he estimates the first properties under construction are the fourth iteration of the Echo prototype. “We've taken our time and done it right.”
The New ECHO
According to Wyndham, the new-build 124-room ECHO Suites prototype requires just under two acres of land. Coming in at approximately 50,000 square-feet—nearly 74 percent of which is rentable—individual rooms average 300 square feet. The rooms consist of single- and two-queen studio suites with kitchens. Public spaces include a lobby, fitness center and 24/7 guest laundry.
An important factor for Ohlsson was the decision to make the brand all new-construction. “We felt having a brand that was built and designed for this segment—and, as a prototype, purpose-built for this segment—was something different [and] unique than a lot of other companies that have been in the space,” he said.
In 2021, the extended-stay segment outperformed all other chain scales with occupancy running nearly 20 points higher than all other U.S. segments combined. More recently, Q3 2022 industry data from STR shows guests checking into economy and midscale extended stay hotels at a higher rate (76 percent) than that of traditional economy and midscale hotels (62 percent).
Ohlsson sees no plateau in sight for extended-stay hotels. “As the segment becomes stronger, we think it becomes stronger in the consumer's mind of staying at purely extended-stay hotels rather than staying at transient properties for a longer period of time,” he said. “Because of that, we see a very very long runway here.”
Wyndham Hotels & Resorts has approximately 9,100 hotels open in more than 95 countries.