Now checking in: Two hotel brands, one site

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If there's any constant among hoteliers, it's their never-ending search for innovations that will lure guests and increase market share.

Toronto-based hotel developer Alnoor Gulamani, president of Bayview Hospitality Group, is no different, and that would explain his willingness to build his two newest hotels on the same property.

"There has been a fundamental shift in customer demand," Mr. Gulamani says. "(The hotel industry) is really driven by the need of the customer, and we're here to offer choice."

Indeed, hotel chains are forever jockeying for an edge in a highly competitive and vulnerable market that is always in transition. As such, Mr. Gulamani is hoping that his new $31-million, 254-room dual-brand complex near Toronto's Pearson International Airport will provide just such a competitive advantage.

The property, which opened in March, hosts two Hilton chain brands - Homewood Suites and Hampton Inn, both in separate towers and with separate lobbies. The former caters to the lucrative extended-stay business market, while the latter services more traditional travellers who opt for shorter stays. With about a $30 difference in price per night, the hotels share some staff, as well as a pool, meeting rooms and a fitness centre, all housed in a common building that links the two.

But when evaluating the dual-brand model - which major hotel chains across North America such as Hilton Worldwide, Marriott International and Starwood Hotels and Resorts began embracing in the late 1990s in an attempt to appeal to a broader customer market and generate cost efficiencies - the pressing question is whether this latest hotel innovation will prove viable in the long term.

Market demand and cost savings are more than enough to make the dual-brand model an industry fixture for the foreseeable future, says Monique Rosszell, the Toronto-based senior vice-president of hotel consulting firm HVS Global Hospitality Services.

"There's a market need, and you've got economies of scale when you put two brands on one site," Ms. Rosszell says. "It's here to stay because it gives hotels a healthier bottom line."

Indeed, Mr. Gulamani estimates his construction savings at about 10 per cent to 15 per cent over the cost of building separate hotels, with annual operating savings at about 15 per cent to 20 per cent from shared staff and amenities.

Innovations such as these are typically perfected south of the border before heading to other markets. In Canada, the model has been tried by Marriott, which opened a Residence Inn-Courtyard Hotel combo property near Montreal's Trudeau International Airport in 2006.

While he agrees that multi-brand hotels are a new industry norm, Brian Stanford, the Toronto-based director of hotel industry consultancy PKF Canada, says traditional, single-brand hotels will still dominate the market for the foreseeable future.

"Over the last few years we're seeing in the range of 50 hotel projects and 5,000 rooms being developed a year here in Canada," he says. "But the mixed-use area of complementary or related brands is certainly not dominating the development landscape."

He predicts that because acquiring capital for new projects will remain a challenge, the dual-brand category will fail to grow greater than just 1 per cent to 2 per cent of Canada's current total hotel market of more than 8,000 hotel properties.

One thing is certain: For every hotel innovation that changes the industry, there is at least one (and likely many more) that falls flat. Here are some of the innovations from the past 20 years that worked, and some that became footnotes of history:

Three innovations that worked …

In-room, high-speed, wireless Internet access: As Anthony Pollard, president of the Hotel Association of Canada, explains, in-room Internet access was once a pipe dream for hoteliers. When some began offering the service in the late 1990s, it was typically at a premium price. Now, mid-range chains such as Hampton Inn and Holiday Inn include wireless access in their room rates - a "free" service guests have come to expect. "Today, (in-room, wireless Internet access) is the norm and every hotel has to have it or they won't stay in business," Mr. Pollard says.

Hotel-condo combinations: Take a look at the hotel building boom in downtown Toronto and it's easy to conclude that demand for five-star properties has hit a fever pitch. Premium chains such as Shangri-La, Ritz-Carlton and Four Seasons have all broken ground on new high-end condo-hotel combo properties. But as Ms. Rosszell explains, these developments have surged in popularity across North America since the mid-1990s, after proving their value in major centres such as New York, because they present new opportunities to high-end hoteliers, as well as improved efficiencies. "The condo-hotel has enabled developers to build five-star properties that they wouldn't be able to do otherwise because the condo sale subsidized the hotel," Ms. Rosszell says. "That has really been a benefit for the industry."

Extended-stay hotels: Ms. Rosszell cites their value in serving the long-stay business market with affordable, multi-room suite configurations, business-friendly amenities and in-room kitchenettes. "When you're off training for a month, you can only take so much restaurant food," she notes.

… and three that didn't:

In-room fax machines: Guests quickly found that bed-side faxes, which became popular in the 1990s, tethered them a bit too closely to the office. "A fax machine in the bedroom is very noisy," Mr. Pollard says. Even before guests began relying heavily on e-mail to send documents, hotels began pulling the units out of rooms around the early 2000s and placing them in centralized business centres, much to the delight of sleep-deprived business travellers.

Strata title hotels: Popular among Canadians looking for investment properties in resort hot spots such as Whistler, B.C., in the late 1990s, strata title properties, in which individuals own one or more of a hotel's rooms, soon presented practical operational challenges. "These were all the rage at one point, but there were too many complications in terms of having such a big pool of owners who weren't hotel-savvy," says Ms. Rosszell. "You don't see a lot of these developments any longer, but it was all the rage for a while because it was easy to get financing."

No-frills lodging: While airline passengers may be willing to tolerate limited service for short flights on discount airlines, it turns out that Canadians expect a certain level of comfort when they stay at a hotel, says Mr. Stanford. "There have been efforts to introduce (ultra) economy hotels into the Canadian marketplace, with some limited success," he explains, citing attempts by no-frills chains such as Microtel Inns and Suites and Sleep Inn to gain a stronger foothold in this country. As Mr. Stanford explains, "we just don't have that market depth if somebody is looking for a $40-a-night hotel room when they can get something for $60 or $70" with more amenities.