Canadian Lodging News – MasterBUILT: a good time to invest in hotels

Original Article in Canadian Lodging News

Patio at Microtel, Bonnyville, Alta.

CALGARY — MasterBUILT, Canadian franchisor of Microtel, is building new properties and investing in others, with the idea that these hotels are located in communities that had strong demand during COVID, need to get through it, and will emerge strongly at the end of the pandemic. CLN spoke with Marc Staniloff and Dave Donaldson regarding the Kanata, Ont. Microtel that recently broke ground, renovations to properties in Lloydminster, Estevan, and Weyburn, Sask., and Bonneyville, Alta. Staniloff’s related company, Superior Lodging Corp., is also spending almost $2 million on its Courtyard by Marriott hotel in Calgary’s “deep south” community of Seton.

Last month, in partnership with the Eeyou Cree First Nation and Tawich Development, MasterBUILT broke ground on a Microtel in Kanata, in the west end of Ottawa. This will be a four-storey, 109-room property at 340 Huntmar Drive, Kanata. It will include a pool with water slide, and is expected to open in early 2022.

Microtel now under construction in Kanata, near Ottawa, Ont.

“We are working with Eeyou and Tawich, our partners out of Northern Quebec,” said Staniloff, co-founder and chairman of MasterBUILT. “We are equity partners in this venture. We liked the market pre-COVID. We felt that it was very strong before COVID, and that it will continue to be very strong post-COVID. It’s in a great location, across Highway 417 from the Arena,” he said. “We felt the market was under-supplied and there was a need for a new product in the market with branding and price point where it is supposed to be.”

Staniloff added that Microtel has had great success with First Nations partners, as they tend to travel a lot and stay in the places where they have investments. “They’re a whole market themselves,” he added.

“We are excited to be building at this time — that we as hotel operators are trying to look past this and grow our portfolio,” said Dave Donaldson, who has been president of MasterBUILT for seven months. “We have a Microtel that is under construction in Aurora, Ont. This market was very good pre-COVID and should be very good post-COVID. We just need to get through the dip until life continues normally, and we will be in a good position.”

Microtel currently under construction in Aurora, Ont.

The Aurora property has a new general manager, Tsungayi Chigwamba, who has managed Microtels in Bonneyville and Lloydminster and is relocating to Toronto.

There is also another Microtel coming on stream in Dorval, Que.

“MasterBUILT has promised to have 75 Microtels constructed by 2036. We are getting there are we are on track. We have a significant pipeline going forward,” Donaldson said.

Microtel is also spending $5 million on extensive renovations of four of its original Microtels, in Estevan, Weyburn, and Lloydminster, Sask., and Bonnyville, Alta.  “We are putting in pools with waterslide, licensed bars, and outdoor patios with gazebos and BBQs,” said Donaldson. “These are markets where oil and gas are big demand drivers, and the market has been hit pretty hard. The tourist market and the commercial market continue to give us the leading position in these areas.”

Lobby and Lounge rendering for Microtels in Estevan, Weyburn, Lloydminster and Bonnyville.

The addition of pools is something of a signature, said Staniloff, noting that sister company Superior Lodging Corp. has long installed pools and waterslides in its Super 8 properties. “A patio with a gazebo, fireplace, and barbecue is not what you’d expect. Our Microtel in Fort McMurray has had success with a patio and barbecue. We’re looking at possibly making it a brand standard for our Microtel Canadian hotels.”

Staniloff is also renovating a Courtyard by Marriott in the Highway 2 and Seton area of south Calgary, right across the street from the new hospital the province is building.

New Rendezvous restaurant concept at Courtyard by Marriott, Calgary South.

“We are spending $2 million to reconfigure the food and beverage there, with a new concept called Rendezvous, an upper-mid-market restaurant, complete with dining, dancing, and a music theme,” said Staniloff. The renovations should be finished on Dec. 15.

“Our target is both hotel customers and the community,” said Donaldson. “This helps generate demand and serve the community in a target market that is under-served. We have a third party food and beverage operator that has been involved in very successful restaurants.”

“We at MasterBUILT are completely committed to our product. Now is the exact right time to put money in, renovate and make our hotels the best in class. Lenders like what we are doing, and recognize that we continue to support our properties during this challenge.”

“We believe we have enough market share to be best in class; that people will travel and need our product. There’s a big difference between MasterBUILT, which is putting money into its properties, and some of our competitors who are ‘turtling’, and maybe aren’t as open and forward-thinking.”

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