Almost exactly nine months after the brand was first announced, Hilton celebrated the grand opening of the first property under its “premium economy” Spark by Hilton flag. The 120-guestroom Spark by Hilton Mystic (Conn.) Groton, developed by Distinctive Hospitality Group, is a conversion of a former Days Inn—and an example of how the conversion-only brand is likely to gain ground in the sector.
The Debut
The project began to take shape not long after Hilton first announced the new brand, said Lou Carrier, president, Distinctive Hospitality Group, which also owns the nearby Hilton Mystic, a 183-room full-service hotel. “We're familiar with the marketplace,” Carrier said. “We've been here for 10 years.” While Carrier and his team had faith in Mystic’s strength as a hospitality market, they also recognized that the economy segment was “very poorly represented,” creating an opportunity for the right project. The former hotel had come on the market several times, Carrier added, but the DHG team did not want to acquire the asset without the right brand to go with it. “It was more than just a matter of money to restore one of these properties,” he said. “For this market’s consumer, there's an expectation of quality.”
Learning about Hilton’s in-development brand, however, gave the company “the cause and the confidence” to acquire the hotel and start the conversion project. DHG purchased the hotel in “very, very late March” for upwards of $5.5 million, met with the Cincinnati-based Pivot Studio architecture and design firm three weeks later and started the renovation process immediately thereafter. The project cost $35,000 per key, including exterior improvements and all furniture, fixtures and equipment. (Hilton anticipates that the cost per key will be $18,000-$23,000 for the average conversion.)
In the six months between the acquisition and the hotel’s soft opening in September, the DHG team worked closely with the Hilton Supply Management team. “We had a point person on everything that we were doing,” Carrier said, noting the support for FF&E issues as well as any concerns regarding operating supplies and equipment. Pivot, he added, had worked with Hilton on the prototype design, and was able to streamline the conversion process.
Throughout that process, everything in the hotel was removed. “We literally kept nothing,” Carrier said. “Floors were stripped. Many walls had to be removed and redone.” The property went from four connecting rooms to 44, with interior doors added between them. The in-room PTAC units were replaced and even fire and safety systems had to be completely redone. “Normally, you wouldn't have to worry about all of that stuff. We worried about all of it.”
In total, Carrier said the company spent “north of $10 million” on the debut Spark, from the acquisition to the full renovation—but acknowledged that this number could be very different for future projects.
Design and Procurement
Throughout the Mystic project, the Hilton team worked with Carrier to help complete the conversion while supporting his budget. “We came in on budget,” said Alissa Klees, brand leader of Spark by Hilton.
At least some of that could be credited to Hilton Supply Management, the company’s procurement division which helped develop the brand’s concept and prototype.“We brought them along with us from day one, to help us select the products that would go into the final design,” Klees said. While the brand team worked with designers to determine the aesthetic, she added, procurement specialists shared insights on what products would make logistical sense and provide durability.
As a conversion-only brand, many Sparks will have different layouts and room sizes. As such, Klees acknowledged, rooms may not be identical from property to property, but they will have consistent elements. For example, some hotels have vanities with sinks outside of the bathroom, while others have the sink inside. While the positioning might be different, that vanity will be the same regardless of where it is, with different sizes available for quick swap-outs. “For every conversion for Spark, we've tried to think of a like-for-like replacement to make it really easy for the owner,” she said. “[We] tried to just bring it down to the functionality of the room, but do it in a great design.”
Another functional element is the pivoting desk that can stay flat against the wall or shift to an L-shape. “Consumers said they wanted additional places just to sit if they were traveling with their families or their partners,” Klees said. The movable table, then, provided additional space to sit and socialize without adding “bulk” to the room. “It's pretty duty,” she added. “It's designed to last 10 years and not break.” As the brand grows and converts hotels with one-bedroom suites, other types of tables will be available as needed for separate living rooms and bedrooms.
Even the linens were a concern, said Matt Schuyler, chief brand officer at Hilton, who noted the brand’s bedding materials were engineered both for “quality” and ease of cleaning. “We want them to be durable. We want them to be sustainable. We want them to last a long time—because replenishment is an expensive endeavor for any type of hotelier.” The sheets were also engineered to make it easier for housekeepers to put them on and take them off the guestroom beds. “It's a fitted bed top that's been engineered by our teams to be easy to pull on and look good.”
The procurement division is a “secret weapon” for the company, Schuyler continued. “They're purchasing these types of products—and so many more—at a scale that allows assurances that we can get the highest quality for a really good price for our owners.” Even as Spark and other Hilton brands gain ground, Schuyler expects HSM to be able to source all of the required FF&E and other elements thanks to the scale at which they procure. “We've engineered it to be scalable in this regard.”
Bucking traditional design, the Mystic hotel’s main gathering area is not by the main entrance and front desk, but upstairs in the breakfast room, which is open 24 hours and has different seating options for eating, socializing, watching TV and working. “This Mystic property is a great example of stress testing how far you can stretch the brand standards relative to common area design,” Schuyler noted. “You can adjust based on the conditions of the conversion opportunity. … We love the fact that we could stretch our brand in the first opening to see what it's capable of. And if you can do it here, think of the opportunity to do it elsewhere in more prototypical layouts.”
Development and Pipeline
Less than a year after announcing the brand, Hilton is holding more than 400 “active conversations” about Spark developments, Klees said, with 100 projects already seeing hammers in walls. “We can’t say ‘shovel in ground’ because they’re conversions,” she quipped. The brand has attracted attention from developers across the country and in Canada as well, with the first international opening slated for next year. Schuyler, who also sees opportunities to take the brand to Europe and Latin America, expects many of the conversions to take between six to nine months to complete.
Beyond existing economy brands, Klees expects to see midscale and even upper-midscale hotels join the Spark portfolio—a move that she believes could help Hilton as a company maintain its total portfolio. Traditionally, when hotels in the company’s upper-midscale segment come to the end of their lives, they would be “gifted” to competing companies, she said. Now, those owners will be able to convert to Spark, “inject new life into [the hotel] and stay in the Hilton system.”
Hilton, Carrier predicted, is “going to redefine the economy [segment] across the globe” with the new brand—“certainly here in the United States, where there is an unfortunate perception that in that space, you're crossing your fingers when you've crossed the threshold.”