It’s a good time to be in the extended stay hotel business. As David Eisen explained in an article for Hotels, this sector of the hospitality business has been growing in recent years. He cites data from May to the effect that over 10% of the nation’s hotel capacity can be found in extended stay properties — along with a growing number of hospitality companies looking to enter the space.
This includes an uptick in the number of rooms being built. Hotels points to data from hotel research firm The Highland Group to the effect that there are 115,000 more rooms in the extended stay category than there were in 2019. This marks a significant turnaround for the space, which hasn’t always seen as positive an outlook. In 2009, one of the most prominent brands in the sector, Extended Stay, filed for bankruptcy. The company emerged from it a year later with new owners and a new chairman and was sold in 2021 for $6 billion.
Eisen’s analysis of the state of the industry points to an interesting element of the extended stay segment’s growth: it’s doing better than the overall hospitality sector, which isn’t back to its pre-pandemic levels as of yet. Hotels cites Kristine Kacarab from hotel revenue management company Kalibri, who noted that demand for extended stay rooms has remained steady.
One clue as to why this segment has done so well can be found in a 2024 article from Skift, which noted that demand for extended stay properties was up in part due to the demands of workers hired on projects funded by the 2021 infrastructure bill.
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An expanded tournament makes things more complicatedAnother important takeaway from this analysis, though, is that viewing all extended stay properties as a uniform category is a mistake. Instead, as Eisen reports, there are high-end, low-end and midrange options available to travelers looking to settle in for a while. This feels like another way in which the hospitality industry is evolving — sometimes in ways that don’t even involve traditional hotels.
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