Dec162014

IHG acquires Kimpton Hotels boutique chain, but don’t expect PointBreaks deals in 2015

IHG acquires Kimpton Hotels boutique chain in a $430 million deal, but don’t expect PointBreaks deals in 2015 for your favorite Kimpton. The best we can expect for IHG in the near future is maybe they will pick up some of Kimpton’s IT savvy and laid back California charm to counterbalance the IHG UK corporate face and troublesome promotion roll outs.

Kimpton Hotels manages 62 hotels around the USA and has another 16 hotels in the pipeline. IHG currently has Hotel Indigo as its boutique brand and EVEN, a new fitness-focused brand recently launched. The acquisition of Kimpton will double the IHG boutique portfolio and put the chain at nearly 200 boutique hotels. In general, Kimpton Hotels will be more upscale than Hotel Indigo.

In the short-term, Kimpton will maintain its Kimpton Karma loyalty program. I don’t think the loyalty programs will merge until the latter half of 2015 based on the time it has taken Marriott to merge with AC Hotels and Protea after those chains were purchased. On the other hand, Hyatt was able to integrate Avia (Andaz) and Sierra Suites (Hyatt HOUSE) into its program quickly, but Hyatt is not the behemoth organization IHG. In time, we should get word on how IHG and Kimpton plan to integrate loyalty programs and categorize the Kimpton Hotels for IHG Rewards Club points.

I imagine Kimpton will retain its own name brand in IHG since the brand recognition and attitude to Kimpton Hotels is highly favorable. Kimpton has made a name for itself by remodeling historic buildings in urban centers into designer boutique hotels. Kimpton will fill a slot below InterContinental Hotels luxury segment. IHG brands Crowne Plaza and Hotel Indigo fall into the Upscale Hotels market segment as categorized by Smith Travel Research, the Tennessee based hotel data company. Upscale brands in other chains are Starwood Hotels Four Points, Marriott Courtyard, Hyatt Place and DoubleTree.

IHG has a serious gap in the Upper Upscale Hotels market segment where brands like Marriott, Renaissance, Autograph Collection, Sheraton, Westin, Le Meridien, Hyatt Regency, Hilton and Embassy Suites hotel brands reside in terms of their average daily rate.

Kimpton is firmly in the upper upscale hotel market segment for the USA and will fill that void in IHG between luxury InterContinental Hotels and the often times ageing Crowne Plaza hotels and the small footprint of Hotel Indigo brand, which seem like second tier boutique hotels in many locations.

IHG says they see Kimpton rolling out internationally as a hotel brand of IHG.

I don’t expect points bargains when IHG integrates Kimpton Hotels for reward nights with IHG Rewards Club points. Most of the Kimpton properties should fall in the 30,000 to 50,000 points range. I doubt we will see the integration before summer 2015 and perhaps not until 2016.

Personally, I love the fact that San Francisco with IHG will become a bit like London with Club Carlson and its 18 Radisson Edwardian hotels. Kimpton has 9 hotels in San Francisco and 17 in California.

Kimpton Karma

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Ric Garrido of Monterey, California is writer and owner of Loyalty Traveler.

Loyalty Traveler shares news and views on hotels, hotel loyalty programs and vacation destinations for frequent guests. Check out current hotel loyalty program offers across all the major chains in Loyalty Traveler’s monthly hotel promotions guide.

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About Ric Garrido

Ric Garrido of Monterey, California started Loyalty Traveler in 2006 for traveler education on hotel and air travel, primarily using frequent flyer and frequent guest loyalty programs for bargain travel. Loyalty Traveler joined BoardingArea.com in 2008.

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Comments

  1. I have serious doubts about Smith Travel Research if Hyatt Place and Four Points are considered “upscale.” Next to what, a two-star Motel 6? Crowne Plaza is a full service brand and the others in that list are mostly roadside or budget options.

  2. Smith Travel Research hotel market segments are based on the average daily rates for a brand. If Motel 6 commanded $400 per night rates, then it would be a luxury brand.

    Crowne Plaza and Hotel Indigo are upscale brands based on their rates across the brand.

    Four Points and Hyatt Place are upper upscale based on their higher average rates.

    Full-service and limited service are not the defining factors for market segments, although they tend to align that way for the most part in the market segments.

  3. It will be interesting to see if I can use my IHG free night certificate at Kimpton hotels. Maybe this new change will make IHG’s promotions more enticing 🙂

  4. I’d like to see you, if you haven’t already, set up a comparative family members among brands.

    Brand us marriot, IHG, Hilton
    Family is courtyard, holiday inn, Hampton inn.

    From my experience with kimpton I wouldn’t classify it the way you did. The hotels are good. Just very different and unique compared to other families.

  5. @Dan – I’m not sure what you mean by how I classified Kimpton as a brand?

    Kimpton as a brand is similar to W Hotels, Le Meridien, Autograph Collection. They have distinct character visible in the lobby design and guest culture.

    STR segments brands based on their average daily rate. IHG has Crowne Plaza which in most cases seems like an upper upscale hotel brand, yet its average daily rate as a hotel brand is not in the upper upscale market.

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