Red Roof bulks up international expansion into Thailand, Brazil

Two years ago at its conference in Orlando, Fla., Red Roof Inn announced its plans to expand north into Canada. These plans came to fruition earlier this year with the announcement that it will be partnering with Pacrim Hospitality Services to open 40 new hotels in the country, but its international expansion doesn't stop there. At this year's Red Roof brand conference in Hollywood, Fla., company president Andrew Alexander revealed two new development targets for 2016: Brazil and Thailand.

Red Roof's movement into Brazil is already in progress, with its first hotel opening in Curitibana earlier this year. The company partnered with Brazil-based Nobile Hotels for the development of between 35 and 40 new Red Roof properties. In Thailand, Red Roof partnered with Paragon Hotels Limited, part of Paragon Partners, with openings planned to take place next year.

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"Our determinations on decisions regarding international development come back to partnering with someone on the inside who knows the market," Andrew Alexander, president of Red Roof, told Hotel Management. "Glenn Squires, who heads Pacrim Hospitality, is in Canada. We aren't. We chose Glenn because he knows the market."

Phil Hugh, chief development officer for Red Roof, said the company chose Paragon Hotels as its developer in Thailand because of their long-term plans for disseminating the Red Roof brand throughout the country.

"These are not development agreements or anything in the planning stages, in our initial meetings this organization was putting a machine together," Hugh said. "We were discussing building on sites that were already secured. They don't have a dream, they have a plan."

According to Hugh, the plan regarding Brazil was slightly different because the majority of the supply in the country was unaffiliated with individual ownership groups, meaning Red Roof saw a void in the market they believed could be filled.

"There wasn't a consistent, quality brand in Brazil in the economy segment, and Nobile operates 30 hotels in the country," Hugh said. "They came to us and say 'we have some of your competitors, but we like what we are hearing about you.'"

"We are more about what is the strategic brand to get a brand in a region," Hugh said. "It's not strategic to have one hotel in a new market or country. It would be very easy to get into Puerto Rico, but what is the plan? That's what we are looking for."