Aloft, one of the new lifestyle brands of Starwood Hotels & Resorts Worldwide Inc. ( HOT ) finally stepped into Thailand on Monday. Located in the heart of Bangkok, the hotel features 296 guest rooms along with tech-savvy amenities.
Starwood set a new trend in hotel designs with its Aloft and has spread its operations globally with more than 55 hotels it opened since its launch in June 2008. The brand rides on a high growth trajectory and has already left its mark in every region including North America, Europe, the Middle East, Latin America, India, Southeast Asia and China. Management's confidence on this brand is evidenced by its decision to shut down two U.S. hotels and convert those to Aloft. In the third quarter of 2011, RevPAR growth in Aloft was 14.4% or 14.1% in constant dollars, the highest among all the other brands.
We believe Bangkok is a strategic fit for new hotels, as it is an important tourist destination. The hotelier is all set to tap the market, as Thailand attracts tourists from all over the world. Apart from the recently opened Aloft, Starwood has some of its other brands including Four Points by Sheraton, Le Meridien, Sheraton, Luxury Collection, St. Regis and Westin operating in Bangkok. Starwood's major competitors Hyatt Hotel Corp. ( H ) and Marriott International Inc. ( MAR ) also have considerable presence in Bangkok.
The urban concept of Aloft will mainly cater to the modern travelers seeking a unique experience. With the flood conditions easing in Thailand and everyone looking forward to the Christmas and New Year holidays we believe the timing of a hotel opening is appropriate.
Starwood currently retains a Zacks #3 Rank, which translates into a short-term Hold rating. We also reiterate our long-term Neutral recommendation on the stock.