Franchise Talk

Belmonte to lead Lexington

October 16th, 2006 | Author: Jack

Steve Belmonte spent 11 years promoting hotel franchise agreements, three years dissecting them, and now is competing against them as the leader of a brand that uses membership as its business model.

Belmonte, who led the Ramada Inn chain for 11 years and is the founder of contract-negotiating company Hospitality Solutions, has been named partner, president and c.e.o. of Vantage Hospitality’s Lexington Collection brand. The announcement was made at a news conference held during The Lodging Conference in mid-September.

Roger Bloss, c.e.o. and president of Vantage, said Belmonte’s reputation in ownership, management and branding made him an easy choice for the job. He said Belmonte’s three years experience with fair-franchising negotiations gives him a unique perspective on the lodging landscape.

“He can see both sides of the fence,” Bloss said. “So, rather than going to one side or another, we offer something in the middle that’s equitable for all parties involved. Steve fits right into that.”

“It’s no secret that I’ve been an advocate for fair franchising,” Belmonte said. “I’ve been searching for a better solution, and I’ve found one.”

Belmonte said Hospitality Solutions negotiated several hundred liquidated-damages disagreements during the past three years.

“It set off a light bulb about how many people are disenchanted with the current system,” Belmonte said. “To be able to offer a different model is what I’ve been looking for.”

The Lexington hotel brand dates to the 1960s, and was resurrected by Vantage earlier this year with Scott House as group president for the brand. House has since left the company. The brand has six properties open and about a dozen others in various stages of development.

Bloss said there is no pressure for Lexington to experience the fast growth of sister brand Americas Best Value Inn, which built a system of more than 600 hotels in seven years.

“Growth is not going to come in huge numbers for Lexington,” Bloss said.

He said the company is forecasting to have 35 Lexington properties—comprising those open and under development—in the fold by September 2007.

“For half the guys out there, it’s all about the numbers,” Belmonte said. “When you’re under that kind of pressure, you tend to go after low-hanging fruit—even though it might not be in the best interest of the brand. We’re not about the numbers. We’re about building a great brand within a unique business model that benefits both sides.”

Lexington and ABVI have annual agreements with no liquidated-damages clauses in the contracts. The Vantage brands allow members to select the type of fee structure they want—either a flat fee or a percentage of gross revenue. A member can change his or her fee structure at any time.

“This makes sure you stay in business in good times and bad,” Bloss said.

The Lexington brand features what Vantage calls the freestyle lodging concept. The brand will be comprised of hotels that are rated three stars or four stars by Mobil. The freestyle concept allows owners to choose which amenities are offered in their hotels to meet individual market needs. They must have at least two-thirds of the amenities on a predetermined company list.

Share and Enjoy: