By Jim Adair

You would think that launching a new hotel concept in the middle of a recession, using a brand not well-known in Canada, would be a risk that most real estate investors would avoid. But for Al Gulamani of Bayview Hospitality Group, the opportunity to build a new dual-branded hotel near Toronto Airport was too good an idea to pass up – and now his gamble is paying off.

The dual-branded Toronto Airport complex was built during the recession for $31 million.

“In Canada, the extended stay market has been underserved for a long time,” says Gulamani. An entrepreneur formerly associated with other brands, he was attracted to Homewood Suites when he toured the first one in Canada, at Mont Tremblant, Que. Now he owns three of the nine Homewood Suites hotels in Canada – one in Cambridge, Ont., one in Oakville, and the recently opened Toronto Airport site.

The Toronto site is unique because it is part of a trend to dual-branded hotels on the same site – in this case, the Homewood Suites building sits beside a Hampton Inn. The two operate as separate hotels, with their own check-in desks, food service areas, lobbies and elevators, but they share meeting rooms, a business centre, a swimming pool and exercise facilities. Both the Homewood Suites and Hampton Inn brands are owned by Hilton.

Homewood Suites is aimed at business travellers who need a place for stay for five or more nights – the average is 11 nights. The hotels offer studio, one and two-bedroom suites, and include fully equipped kitchens, complimentary high-speed Internet access, and a comfortable, homey surrounding. The hotels are built like an old-fashioned lodge, with communal spaces where a free hot breakfast is served every morning and free light dinners and refreshments are offered in the evening. The menus are changed constantly and posted in the rooms so guests can decide if they want to eat in the lodge or make their own dinner in their suite.

Bill Duncan, global head of Homewood Suites, says that “Canada has been a great success story” for the brand and there are plans to expand it across the country. The company takes existing properties and renovates them to its standards, or builds new, as in the case of Gulamani’s properties.

A panoramic view of one of the Homewood suites.

While the original Homewood Suites were designed to feel somewhat like a “hunting lodge”, Duncan says the interior design has become more upscale to cater to female clients. He says that while business travellers used to be mostly men, now the split is closer to 50/50.

Homewood Suites targets mostly extended-stay visitors, but those coming for shorter stays are also welcome, as are families that are on vacation.

At the Toronto Airport site, those in town for a shorter visit may want to stay on the Hampton Inn side of the complex, where prices are typically $20 to $30 cheaper per night. The Hampton Inn also offers a free hot breakfast, as well as “on the run breakfast bags” for those who need their breakfast to go. The hotel has its own breakfast area. The inn also offers free Internet access.

Both brands offer points for the Hilton loyalty program, as well as airline loyalty miles. Duncan says that’s an increasingly important factor when travellers are choosing where they will stay.

The Toronto complex includes 128 Homewood Suites rooms and 126 Hampton Inn guest rooms. Opened this spring, the hotel ran at about 40 per cent occupancy for the first few months and Gulamani expects that to grow to 60 per cent by the end of the year as the hotel becomes more well-known.

Built during the recession, the complex cost $31 million to construct. Gulamani says the downturn actually helped him because more tradespeople were available and some building material prices came down – “I probably saved about 10 to 15 per cent.”

It also helped that the site is on the extreme western edge of Toronto, one of the last sites near the airport that could be developed. If it had been built on the other side of the street, it would be in the City of Mississauga – where development charges would have added $4 million to the cost of the project.

Homewood Suites now has almost 300 hotels in the United States, Canada and Mexico.