The COVID-19 pandemic has been a wake-up call for the lodging market and has shed light on the extended-stay concept. According to Matt McElhare, Senior Director, Extended Stay Brands at Choice Hotels International, the extended-stay hotel segment has always been a significant player in the brand mix of hotel companies.
McElhare explained that extended stay makes up 10 percent of the overall lodging supply and 20 percent of the demand for stays of a week or more. He also mentioned that the expansion in this direction was an easy decision for Choice, especially due to the potential growth, thanks to an expected increase in business travelers and newcomers to the segment. McElhare emphasized the under-built segment and the imbalance in supply and demand as supporting factors for the continued growth of the space, particularly at the lower price points.
In the first nine months of 2023, Choice’s extended-stay hotel openings grew by 38 percent, and its extended-stay domestic pipeline increased by 12 percent year over year. Currently, Choice has 60 Everhome Suites properties in the pipeline, and over 250 across three other extended-stay brands.
McElhare pointed out that the demand for extended-stay lodgings is not new and has always been needed for non-discretionary guests who can’t do their jobs via Zoom. He also noted that the pandemic raised awareness of the segment, and others have since gravitated to extended stay for its comfort and flexibility, even for shorter stays.
According to McElhare, current economic trends and fiscal policy also suggest continued extended-stay demand growth, including the $1.2 trillion infrastructure bill and onshoring of industries fueled by the CHIPS Act.