Dive Brief:

• Extended stay hotel brand My Place Hotels of America announced it has entered into a two-phase franchise and development agreement with Jacksonville, Florida-based real estate development and investment firm Rimrock Companies to develop 10 My Place extended stay hotels across Tennessee, South Carolina and Georgia.
• The move comes as Rimrock also partnered with Choice Hotels International to develop 20 or more locations for its rapidly expanding extended stay brands, WoodSpring Suites and Everhome Suites, in Florida, CEO Micah Linton told Hotel Dive. 
• Rimrock is already under construction on its first extended stay hotel in Idaho, another My Place franchise property. The 10-hotel agreement, alongside another partnership with Choice Hotels, solidifies the developer’s entry into the extended stay arena at a time when the product type is taking the hospitality industry by storm. 

Dive Insight:

Demand for the extended stay product type by developers is currently on the rise because of its increased gross operating profit margins and stable occupancy levels. 

Rimrock expects all 10 My Place Hotels to be completed by 2029, with some already under development. Linton did not share timeline details for the forthcoming Choice Hotels properties. 

“Rimrock remains very bullish on the extended stay space,” Linton said, in an email to Hotel Dive. “There is still more demand than adequate supply, and the demand growth is outpacing new product development in the markets we are active in.”

Choice’s WoodSpring Suites brand currently leads the economy extended stay development pipeline for 2023 with 114 projects. According to Lodging Econometrics data obtained by Hotel Dive, other leading brands include Residence Inn by Marriott with 251 projects in the upper-tier category and Home2 Suites by Hilton with 546 projects in the middle-tier category. Lodging Econometrics data also shows My Place, a middle-tier brand, has five projects in the pipeline for 2023. 

While Rimrock has been exploring entering the extended stay market since 2018, Linton told Hotel Dive, the company’s interest in the space grew after extended stay outperformed expectations through the pandemic. 

In 2021, the company proposed an 85-room hotel in Whitefish, Montana, at which time the company’s Greg Gastineau said in an interview with the Whitefish Pilot the company was interested in extended stay hotels designed for guests staying “30 days or more,” calling the sector “the fastest growing segment of the hospitality industry.”

The project was later denied for permit by Whitefish City Council, but Rimrock took similar plans to Nampa, Idaho, where construction is now underway on an 85-room, four-story extended stay hotel adjacent to the Ford Idaho Center. The company partnered with My Place on the property, expected to open this year. 

Rimrock also has a My Place hotel in the pre-development phase in St. Joseph, Missouri, according to Linton. In the long term, he said, Rimrock would like to develop or own 20 or more My Place hotels in the Southeast U.S., a region with strong population and job growth fundamentals. 

Another developer claiming a stake in the extended stay market, partnering with both My Place and WoodSpring Suites, is Wichita, Kansas-based TGC Group. The developer signed a similar franchise agreement with My Place last year to bring 10 new extended stay properties to the Southeast region by 2027. TGC Group also has developed TownePlace Suites by Marriott and Extended Stay America properties.