Wyndham hotels see a boon in Biden’s infrastructure law and a new breed of business traveler

Thanks to Biden’s $1.2 trillion infrastructure bill, the typical business traveler now wears hard hats and work boots. Wyndham Hotels is rolling out a welcome mat for them.

JTwo Sundays prior, Geoff Ballotti, President and CEO of Wyndham Hotels & Resorts, was watching “60 Minutes” and loving what he was hearing. US Transportation Secretary Pete Buttigieg and Anderson Cooper were discussing the bipartisan $1.2 trillion infrastructure bill that President Joe Biden signed into law in November. “When it comes to roads and bridges,” Buttigieg said, “we haven’t invested at that level since the Eisenhower administration, since they built the interstate highway system in the first place. ”

These roads and bridges will not build themselves, of course. The workers helping shore up the nation’s infrastructure will need affordable housing, and Wyndham’s sales teams have been laser-focused on wooing them. “I was so excited to listen to Mayor Pete talk about the awarding of these contracts,” Ballotti says. “There are more than 10 million construction workers who travel every week. And these are our customers, these are our business accounts.

“What’s coming with this $1.2 trillion infrastructure bill is going to create demand for this type of hosting unprecedented in the history of our industry.”

– Geoff Ballotti, CEO of Wyndham Hotels & Resorts

For several months now, Ballotti and his team have been focusing on a new breed of business traveler who don’t wear suits and ties but rather hardhats and work boots. These are the construction crews, electricians, railroad workers, carpenters and road crews hired for major projects across the country.

“In the past year alone, we’ve added 1,000 newly traded corporate accounts that we didn’t have before,” says Wyndham CEO. “And more than half of those corporate accounts that stay at our 6,200 hotels in the United States of America were infrastructure-related corporate accounts.”

Biden’s infrastructure package guarantees at least $850 million in spending over the next five years, but Ballotti thinks the effect of the huge federal investment will be more long-lasting. “I think we’re talking about a cycle,” he says, noting that the hotel industry’s last cycle, which ended in 2019, lasted 11 years. “I think the cycle we’re starting right now has the ability to follow the same sequence, especially since the big financial crisis of 2008 didn’t incorporate that kind of spending,” he says.

Spotting pandemic trends

Two years of Zoom calls have forever changed the traditional paradigm of white-collar business travel, spurring a rise in “bleisure,” or the mixing of leisure and business travel. Ballotti and his team saw evidence of this trend revealed by a noticeable shift in data for Thursday and Sunday evenings, historically the industry’s two mildest days of the week. During the pandemic, these two nights have turned into rock stars according to two important performance indicators: occupancy rate and revenue per available room (RevPAR).

MORE FORBESHow Covid changed business travel forever

“I mean, we saw our Thursday and Sunday nights take off,” Ballotti says. “Why? Because most white collar companies allow people to work from home on Mondays and Fridays. That’s the trend we’re seeing.

With more than 9,000 hotel properties worldwide, Wyndham Hotels & Resorts ranks among the world’s largest hotel companies and among the top 10 hotel brands by revenue. Last year, the company reported adjusted earnings of $590 million, just 5% below pre-pandemic levels in 2019.

Looking to the future, Ballotti likes where he sees the zeitgeist heading in the years to come. “We are a company that is not urban, fortunately. We are not downtown, fortunately. We don’t meet, we’re not a band,” he says. “We are the largest hotel franchise company in the world and we have never been better positioned.”

The 22 brands that make up Wyndham Hotels & Resorts run the gamut from budget chains like Days Inn and Super 8 to midscale brands like Ramada and La Quinta to upscale hotels like the eponymous Wyndham. Currently, Wyndham’s stable includes only one extended-stay chain, Hawthorn Suites. But Ballotti knows he needs another one.

As the lines between work, play and travel have blurred during the pandemic, extended-stay hotels have become the hospitality industry’s greatest success story. Over the past two years, these flexible living chains have proven to be exactly what value-conscious travelers have been looking for – fewer amenities, perhaps, but more apartment-like amenities like kitchens and laundry facilities. , as well as free Wi-Fi. Last year, the extended-stay segment had an average occupancy rate of 73% compared to just 56% for traditional hotels, according to research firm STR.

“We’re focused on who’s building our nation’s broadband, who’s building our New water and energy systems,” says Ballotti. “And those accounts are saying we need an extended stay product because our customers won’t be on the road for a few nights, but a few weeks or potentially a few months.”

Ballotti is filling that hole with “Project ECHO,” an economy extended-stay brand launching in 2023. Rooms will average 300 square feet and come with kitchenettes, while public areas will include a fitness center and laundry reserved for hotel guests. “It might be one of the fastest growing brands we have among our 23,” he says. “Franchisees love our other 22 brands and say they would like to see an extended stay brand in the economic space due to the magnitude of demand.”

“We are very optimistic at the moment, both on our commercial franchise and on adding products in segments that are currently on fire,says Ballotti. “What’s coming with this $1.2 trillion infrastructure bill is going to create demand for this type of hosting unprecedented in the history of our industry.”

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