Hilton Weighing Hostel-Like Brand For Millennials
Hilton, the world’s biggest hospitality company (HLT)—fresh from announcing a REIT spinoff—is thinking about developing a hostel-like brand to tap into Millennial’s wallets. “There’s potential for something that has more of an urban flair, more of a micro hotel,” says Chris Nassetta (pictured), CEO of Hilton Worldwide Holdings.
Millennials are more interested in no-frills, affordable lodging than other groups, and large hoteliers are facing increasing competition from online providers such as Airbnb, Bloomberg reports.
And they are a big market to be missing out on—Stay Wyse predicts young overseas tourists will spend $336B in 2020, up 46% from the $230B they spent in 2014.
Investors are already clambering to get a cut—the French REIT Fonciere des Regions (FDR.PA) is picking up buildings to be operated by Meininger Holding Gmbh and Invesco Real Estate (IVZ) paid €60M (around $65M) for a 23% stake in hostel operator Generator. [Bloomberg]