UK: The landlords of up to 40 Travelodge hotels are planning to replace the flag with Lamington Group’s room2 brand, according to a report in the Daily Telegraph.
Various unnamed landlords are in discussions with Room2, which is planning to launch a ‘lite’ version of its hometel concept.
Travelodge Hotels Ltd. was among the first companies to withhold rent as the coronavirus struck Europe. In June, it agreed a restructuring plan with its creditors, securing a 38 per cent rent cut until the end of December 2021, but allowing landlords to break leases within six months and to seek new operators if they wished.
Travelodge said in a statement at the time that the deal would allow it to “navigate the short-term challenges facing the business as a result of the Covid-19 pandemic”.
Room2 says the lite hometel concept “aligns with its low-risk and lean hometel product model, designed to be able to remain profitable during an economic downturn and which has proved itself to be highly resilient since the start of the Covid-19 pandemic. The company has benefitted from a flexible cost base, enabling it to continue trading throughout the crisis by adjusting the service offering, and focusing on extended stay and essential worker guests”.
Robert Godwin, managing director at Lamington Group and room2, said: “The Covid-19 pandemic has caused disruption on an unprecedented scale and the hospitality industry has been one of the most affected. Many hotel landlords who previously thought their leases offered them protection suddenly found themselves at the mercy of tenants who were either unwilling or unable to pay, even those signed with strong, seemingly well financed hotel brands. As a result, whilst our near term focus continues to be working with all our stakeholders to manage our way through the crisis, we have accelerated the launch of room2 lite, recognising that, now more than ever, the UK budget sector remains ripe for disruption, particularly at a time when landlords are looking elsewhere to avoid being stuck with unfavourable reduced terms.”
“room2 lite was originally borne out of our view that UK budget hotels are underserved by operators in the extended stay and design-led segment, and that there is lot of untapped potential to create truly memorable experiences. The market is dominated by large corporates, unable to pivot quickly in light of a changing economic landscape and changing consumer demands. Our hometel model has held up extremely well in recent months and proved its resilience despite the worst of economic cases. We now see a real opportunity to replicate this success in the budget hotel market, setting a new standard for consumers, while offering landlords a hybrid leasing model which aligns their interests with ours, and is resilient enough to drive sustainable returns over the long term,” he added.
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