Inside the Boutique Hotel Boom

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From Nobu at Ceasers Palace of Las Vegas to Le Narcisse Blanc of Paris, the popularity of boutique hotels has surged greatly in recent years. Originally coined by Steve Rubell in 1984 to describe the Morgans Hotel as a boutique, the term has since been used as a way to classify many small new hotels, sub-hotels within major brands, and a vast majority of luxury hotels.

As a growing force in the hospitality industry, many wonder, what separates boutique hotels from traditional hotels? Largely characterized by their smaller size, personalized service, and often urban settings, these hotels take the idea behind traditional hotels and serve it in a much more intimate setting.

“They tend to be smaller in size, which results in a more intimate vibe, allowing hotel teams to deliver customized guest services and experiences,” stated Jenna Hackett, global head for the Tapestry Collection by Hilton, in an interview with U.S News.

Size has continued to be one of the major characteristics of boutique hotels as they are typically much smaller than traditional hotels with usually no more than 100 rooms available. For example, hotels such as the Monastero Santa Rosa of Italy contains 20 rooms, while the Phulay Bay Ritz-Carlton Reserve of southern Thailand can fill a maximum of 60 rooms. From checking in with the front desk to room service, guests are able to engage in one on one interactions with staff regularly throughout their stay.

Another major coup for boutique hotels is their often-urban setting and use of locally familiar staffing. Cities such as Las Vegas place the majority of their boutique hotels in popular urban areas such as the famous Strip and Downtown Freemont area.

Hotels such as The Cromwell and Oasis at Goldspike thrive in the busiest and most tourist-packed areas of the city. With the obvious benefit of being located in the liveliest areas, these hotels also tend to employ people from the local area. With boutique hotels relying highly on a personalized staffing system, it is no wonder they prefer to employ people that have an intricate understanding of the area. Guests are able to get a personal feel for the location they are visiting.

Boutique hotels are routinely referred to as luxury hotels, and as any guest can see upon arrival, the reference is usually accurate.

After a $650 million renovation, NoMad of Las Vegas will sprout from the former Monte Carlo. Following a three-year, $48 million restoration, the Belmond Cadogen Hotel of London will open February of 2019. The $3.6 million former Northern Lighthouse Board Ship of Edinburgh opened at the start of the new year.

These hotels are among the many high-cost investments into the growing boutique hotel industry. From high scale, interior designs, state of the art technology, gourmet food and beverages, and other first-class amenities these hotels spare no expense when it comes to staying on top.

While boutique hotels may have started as a hot new trend, it has since grown into a major sector of the hospitality industry. The boutique hotel industry has grown at a rate of 4.8 percent over the past five years and is now a $7 billion industry, according to a research report by IBIS, a market research firm.

Although the hospitality industry has long been an unpredictable environment it is clear that boutique hotels are prepared to stick around. Over the next five year IBIS expects the industry to grow at a 3.2 percent clip.

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