Indigo Road Hospitality Group has finally started to see the plans it had when the company launched its accommodation division in 2019 materialize after a pandemic-plagued first couple of years.
“It’s been pretty much a pivotal year for us,” Larry Spelts, president of lodging and lifestyle adventures, said in an interview with Hotel News Now during the Hunter Hotel Investment Conference.
When Indigo Road decided to venture into the hosting industry in late 2019, it was expected that its service would be in high demand. A successful launch at the Americas Lodging Investment Summit in January 2020 had Spelts eager to strike business deals.
“We were like the beauties at the ball. Everyone wanted to dance for us,” Spelts said. “It was exciting for us, and it was exciting for the industry that a very successful restaurant that does full-service restaurants…comes in to operate hotels that have such a good track record with restaurants. It seemed like everyone wanted to talk to us.
Excitement was dashed after COVID-19 swept through the United States over the following months and disrupted the hospitality industry. Spelts said it was difficult to network and develop growth opportunities after the pandemic hit, which slowed the company’s ability to pull out of doors.
Ironically, the first Indigo Road-owned hotel to open — the Skyline Lodge in Highlands, North Carolina, in July 2021 — wouldn’t have happened without the pandemic. The company was originally contracted to operate the hotel, but the then-buyer pulled out due to pandemic-related financial issues. Indigo Road stepped in to buy the hotel.
Spelts said the hotel acquisition was not part of the company’s original business model, but he saw it as a “silver lining” amid tough times.
“We recognized the enormous value of the acquisition and the tremendous strength of the market. We are optimists. We knew the pandemic wasn’t going to last forever,” Spelts said. “We were lucky enough to be able to convince our investment partners to support us and for us to acquire and renovate it.”
In addition to the Skyline Lodge, Indigo Road operates two other hotels: the Alexander Hotel in Miami and the Historic Park Inn Hotel in Mason City, Iowa. Both hotels approached the company in late 2021 to take over management responsibilities from January 1, a development that Spelts said led to a stressful, but successful, integration process over the last few weeks of December 2021.
The company is implementing new food and beverage programming at the Historic Park Inn hotel, bringing Indigo Road back to its roots as a restaurant operator.
“[It’s] really exciting for us because that’s where our passion is, food and drink, and that’s where we really focus on our hotels,” he said.
Although the vast majority of the company’s open hotels and construction projects are saturated in the southeastern region of the United States, it does not object to pursuing opportunities across the country if it works.
“We’re ready and interested in entering any market really in the United States as long as the product and concept makes sense for what we’re good at,” said Spelts.
Indigo Road is currently raising capital to acquire property in Walla Walla, Wash., the state’s premier wine region, he said.
“It’s just a good example of where we would go outside of the Southeast, because the project makes sense for us to vary food and drink,” he said. “This is a beautiful independent historic hotel that would make a great boutique hotel, which is also the space that we really think is strong.”
Going forward, Spelts said he would like to complete the company’s two ongoing deals — the hotel in Walla Walla and one in the mountains of western North Carolina. Indigo Road is also interested in taking over existing hotels that need to be managed.
With all three hotels in operation in the portfolio, he said the company would like to double that number by the end of the year.
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