MINNEAPOLIS—While Carlson Cos. was celebrating its 70th birthday at its February global business conference in Las Vegas, its Carlson Hotels Worldwide division, Minneapolis, was seemingly reinventing itself, announcing aggressive strategies for development, design changes and restructured leadership across regions and market segments.

Personnel changes are significant with the first non-family member, former Carlson Wagonlit leader Hubert Joly, taking over for Marilyn Nelson as CEO of Carlson Cos.; Bjorn Gullakson running the Regent Luxury Group and becoming executive vice president of managed hotels; Wendy Nelson (Marilyn Nelson's daughter) heading owned and managed hotel development; former Rezidor executive Martin Rinck moving over to lead Carlson Hotels Asia Pacific; Paul Kirwin returning to North America as president of the Americas; and Yvonne La Penotiere switching to chief branding officer. This creates a noticeably renewed focus and energy across the family of brands and serves to split brand management and operations so that more attention can be paid to both aspects of the business. The portfolio now totals 972 hotels with 147,396 rooms in 70 countries.

Carlson is renewing its intent to acquire and manage hotels, specifically Radisson and Regent products, to fill out its portfolio in key gateways. Radissons coming online this year in Philadelphia and St. Maarten will include investment from Carlson.

“We hope to spend US$1 billion during the next three to five years to secure trophy assets,” Nelson says. “In the short term, we are focused on Washington, D.C., Chicago, New York, San Francisco and Atlanta. We want to inspire our franchisees by moving from a successful service model to more of the hotel experience. We are in phase one of three phases with design firm BBGM working on the (new breed) hotel experience.”

In the company's ongoing effort to revitalize the luxury Regent brand Gullakson is focused on expansion plans that range from Boston to Bangkok. He is also putting greater emphasis on marketing support and a new, “louder” advertising strategy to better meet the needs of existing Regents. The latest additions include Beijing, Shanghai and Turks & Caicos, which early on averaged a US$500 rate and 60% occupancy. Just coming online are Boston; Bal Harbour, Florida; and the Maldives; with sites under development in Costa Rica, Bangkok, Phuket, Dubrovnik, Dubai and Manila.

For partner Rezidor Hotel Group, CEO Kurt Ritter said his group added 53 hotels in 2007 with properties (60% from existing capital partners) such as the new Regent in Bordeaux, France. Ritter wants Rezidor to open 20,000 new rooms by 2009 with major expansion planned in the CIS states and Russia. In addition, Hotel Missoni finally will get off the ground this year with the first two in Edinburgh and Kuwait.

While Carlson plans to focus its energy on revitalizing the Radisson brand and moving it back toward a portfolio of 200 hotels, one of the sleepers in the portfolio is the Park Inn brand. Rezidor has been successfully rolling out the mid-market brand in Europe, and plans call for increased penetration in Asia and potentially bringing part of the European team to the United States to develop the brand through a conversion program.

While Asia Pacific only accounts for 5% of the portfolio, there is great potential going forward with approximately 55 hotels currently under development, according to Rinck. The goal, he says, is to double the portfolio by adding more than 50 hotels over the next three years. While Carlson can boast seven hotels under development in Thailand, its strongest Asia presence is in India with 18 managed hotels under development. Rinck expects to see more than 30 new hotels there by 2011. “We have signed more management deals already in 2008 in India than all of 2007,” he says.

In general, Carlson is now more willing to own hotels in Asia and Rinck says he is willing to take sliver equity to get into key markets like Hong Kong, Singapore and Tokyo. Rinck says markets like Japan might require a small portfolio acquisition (10-15 hotels) to jump-start the brand.

Strategic partnerships like the one recently struck with China's Sunshine100 Group will add 10 hotels across the country. Last October, Carlson partnered with Lotus Hotel Investment Fund to create a US$1 billion fund to target development in China, India, Thailand and Vietnam.

Throughout the conference, leadership reiterated that among the biggest tasks is for the system to embrace the goldpoints plus loyalty program. More than 202,000 enrolled during the first 90 days of the relaunched global program. Under the new structure, travelers can earn 50% to 100% more points per hotel stay without an increase in the redemption level for rewards. The program also includes the opportunity to earn miles with 23 airline partners. Fredrik Korallus, executive vice president of revenue generation, has led this effort and is emphasizing better global marketing, more program-funded promotions and a design that targets the higher-value business traveler.

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