While big names like Virgin and LondonHouse grab headlines during Chicago's massive expansion of hotel inventory, a quieter trend, the growth of neighborhood-oriented boutique hotels, is bringing the economic benefits of tourist traffic to areas beyond downtown. A feature in Crain's explores the reasons behind the industry's expansion into new neighborhoods, along with the risks posed by competition with established players. In addition to the lifestyle hotel trend exemplified by Longman & Eagle and the forthcoming development of the Northwest Tower, described as "second-bedroom hotels" by an industry expert because they rely on friends and family of locals, venues near schools, such as the 131-room Hyatt Place in Hyde Park, can count on a ready supply of parents and other university visitors.
At the moment, record tourism numbers, and a desire to capitalize on a hot real estate market, make investments in these hotels very attractive. It certainly doesn't hurt that they normally offer a price advantage over Loop hotels. But can these neighborhood-oriented hotels compete during a downturn, when big chains can discount steeply? While the article doesn't mention companies such as Airbnb, which already provide the neighborhood experience a growing number of travelers seek out, the growth of the vacation rental site suggests the need for lodging outside the Loop, and for more unique experiences, hasn't been met.
·What's driving Chicago hotels off the beaten path? [Crain's]
·Previous Hotel Boom Town Coverage [Curbed Chicago]
·18 Most Essential Chicago Hotels [Curbed Chicago]