The Residence Inn and SpringHill Suites, two of the hotels in North Point Hospitality Group’s tri-brand Marriott in downtown Nashville, Tennessee, share a front desk. The AC Hotel, the third in Marriott’s first triplex, is separate.

Three-in-One Multiplies Unique Challenges

Tri-brand hotels in U.S. rewrite operating standards

North Point Hospitality Group significantly contributed to Nashville’s tourism industry in February when it added nearly 500 rooms under one roof.

The hotel development and management company headed by S. Jay Patel opened the nation’s second tri-brand hotel. The 22-story project is the first triple flag for Marriott International.

The property in downtown Nashville’s SoBro neighborhood consists of transient select-service brands AC Hotel and SpringHill Suites, and Residence Inn, an extended-stay hotel.

The first to develop a tri-brand property in the U.S. is First Hospitality Group of Chicago. Last fall, it opened three Hilton-affiliated hotels in a single building on Chicago’s south side – a full-service Hilton Garden Inn, a limited-service Hampton Inn, and a Home2 Suites, an extended-stay hotel.

The 466-room property is 23 stories high. It sits across from McCormick Place, the city’s convention center. A sky bridge connects the three hotels to the 2.6 million-square-foot facility in Chicago’s south side that faces Lake Michigan.

Future Trend?

While the dual-brand concept is relatively new to the U.S. hotel industry, the tri-brand is just budding. It’s hard to say if it will ever become a trend as three hotels on one site would need the right market to thrive.

Designing and constructing the building is an undertaking not for the faint of heart. Managing the business is even more challenging, especially in the beginning as operators encounter issues relative to having three distinct flags in a single building.

And, of course, there’s the cost. The Nashville tri-brand Marriott cost $140 million to build. The Hilton in Chicago had a price tag of $80 million.

During the Hilton project’s grand-opening celebration in November, Bill Duncan, head of Hilton’s all-suites division, spoke at the grand opening, calling the concept innovative. He and other Hilton officials agreed the tri-brand concept may well be a future trend.

Meanwhile. owners and operators of both the Nashville and the Chicago tri-brands are continuing to figure out how best to manage their unique business models to optimize rate, generate the most revenue and, thus, yield the highest return.

Gina Pepper leads sales and marketing at North Point Hospitality Group. Like any new hotel strategy, pre-selling is vital to business.

At North Point’s tri-brand Marriott, most advance bookings have come from groups that like having three hotel options in one building. Whether the groups are meeting on the property’s shared meeting space on the 21st floor or gathering at Music City Center,

Pepper has discovered meeting organizers appreciate being able to give their VIPs an upscale stay at the AC Hotel while providing junior execs and rank-and-file attendees quality accommodations in the SpringHill Suites and Residence Inn.

WATCH: Gina Pepper, who leads sales and marketing at North Point Hospitality, talks about how the Nashville tri-brand Marriott works to gain marketing and operational efficiencies.

Selling to the City

Another key marketing component for North Point was educating local tourism and marketing officials about the tri-brand concept so they would support the project and help sell the option to Nashville’s visitors.

Whip Triplett, executive vice president who oversees North Point’s operations, said part of the project development included explaining the concept to Marriott International as well as Nashville leadership and the city’s visitors.

Whip Triplett is executive vice president at North Point Hospitality, where he oversees the company’s portfolio, including the first tri-brand Marriott in the U.S.

“The city of Nashville very early understood what we were trying to accomplish,” Triplett said. “That this wasn’t simply a collection of three focused-service brands, this was really more than that.”

The building’s finishing touches are key to letting Nashville leadership and visitors know the hotels are above brand standards in design and amenities.

LOOK: One challenge North Point Hospitality Group faced was developing a website that effectively shared the brand promises of each hotel – AC Hotel, SpringHill Suites and Residence Inn – as well as the combined perks of having three choices under one roof.

The tri-brand’s business proposition, does not work in every market, Triplett said. “It’s not as simple as taking three brands and mashing them together.” A tri-brand developer has to consider whether the brands complement one another and if the property manager hires a team that can deal with the complexities of operating three distinct brands under one roof.

Operating the hotels to generate revenue and satisfy guests includes crafting its external message via its website and other marketing strategies. Internally, Triplett said, it’s important to draw the lines between the brands, where guests share space and some amenities, but not all. “If a guest from the AC Hotel wants to go over to the Residence Inn bar, how will that charge migrate back over and how will revenues and costs be accounted for?

“When we look at a consolidated P&L, we all need to understand where the numbers are coming from.”

Floor Plan

The project’s floor plan put AC Hotel and its 209 rooms on one side of the building. It includes several large suites that add an extra floor to the brand’s tower.

The building’s parking garage claims floors one through five.

AC Hotel’s rooms are on floors 6 to 22.

On the other side of the building are SpringHill Suites and Residence Inn.

SpringHill Suite’s 127 rooms are on floors seven to 11.

The 136 suites belonging to Residence Inn take up floors 12 to 20.

Check-in for all three brands is on the sixth floor, but AC Hotel has its own front desk. Residence Inn and SpringHill Suites share a front desk.

The AC Hotel by Marriott Nashville Downtown has a front desk that is separate from the other two hotels in the triplex.

While developing the project, North Point and Marriott knew back-of-house operations and guest amenities would be combined, but because each brand has its unique set of amenities North Point sought waivers from Marriott brand heads.

For example, Residence Inn offers its guests an evening reception, but Marriott waived that brand standard to accommodate North Point’s own F&B concepts – KV5, a bar that serves beverages and small plates; and the rooftop pool and deck RTB, initials that stand for roof top bar.

North Point Hospitality’s tri-brand Marriott hotel in downtown Nashville has two bars. The RTB, which stands for roof top bar, features an outdoor terrace and pool, which are shared by guests of all three hotels.

Shared amenities across the brands include the fitness room on the sixth floor and the rooftop swimming pool and spa on the 21st floor, where the building has a ballroom and meeting space shared property-wide.

A guest bonus is standards required of each brand are shared among the hotels. In some cases that means elevated amenities.

Residence Inn calls for a guest laundry, so the amenity is open to guests of all three hotels.

Because having three separate types of guest-room linens and towels would create a cost and efficiency nightmare, every room gets upscale linens used in the AC Hotel.

Also thanks to AC Hotel’s brand standard, the shared fitness room has Peloton bikes with video screens that show spin classes.

WATCH: Juan Mera, general manager of the tri-brand Marriott in downtown Nashville, faced operational challenges such as managing different brand standards and cross-training staff.

Chicago Visit

While the Nashville Marriott was under construction, Pepper and General Manager Juan Mera visited the tri-brand Hilton in Chicago to get a glimpse of its design.

When putting the tri-brand Marriott in Nashville and the Hilton triplex in Chicago side by side, it is easy to spot the differences between the two.

The Hilton properties have thicker firewalls among the brands. The shared lobby has one front desk and behind it are three separate entrances to three towers constructed side by side. Each brand tower has its own set of elevators.

Hilton brand executives said maintaining the brand’s distinctive identities were paramount when working with First Hospitality in designing the building as well as its operations.

First Hospitality’s hotel tower in Chicago’s south side features Hilton Garden Inn, Hampton Inn and Home2 Suites. The sky bridge connects the hotels to McCormick Place, the largest convention center in North America.

Jared Heglin, managing director and asset manager of the tri-brand, said over the past nine months, business has steadily grown. Thanks to the adjacent McCormick Center, the hotels cater to a lot of groups.

When ProFood Tech held its annual event at McCormick Place in March, it reserved a block of rooms at the tri-brand Hilton. Convention goers gobbled up the room nights, with Hilton Garden Inn selling out first.

As North Point did with getting Nashville tourism officials and travelers on board with the tri-brand concept, First Hospitality sees guests quickly catch on that the building has three hotels at one address.

Combining brands of different price tiers also attracts different customer segments. It also keeps groups together on the same property versus seeing them separate into nearby competing hotels.

More to Come?

Jay Patel, CEO of North Point Hospitality based in Atlanta, said his company is considering developing a tri-brand hotel in another city. He would not name the location, saying the project is in a preliminary stage.

Jay Patel, center, president and CEO of North Point Hospitality Group, prepares to cut the ceremonial ribbon on Feb. 26 during the grand opening of the tri-brand Marriott in downtown Nashville. With him are, from left, Eric Jacobs of Marriott International; JK Patel, Jay’s father and founder of North Point Hospitality; and Nashville Mayor David Briley. The others are unidentified.

Meantime, North Point Hospitality continues to join different brands on single sites.

This summer it will break ground on an AC Hotel going up next to its Homewood Suites in Savannah. The mixed-use project along the river will eventually host four branded hotels.

And the company plans to build two different brands side by side on a lot in Nashville’s midtown.

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