Behind the Scenes
hilton-fitness-room-770.jpg Photo courtesy Hilton Hotels.
This emerging trend of hotel-health clubs is “history repeating itself,” Steven Schwartz, CEO of Midtown Athletic Clubs, told Club Industry, likening contemporary facilities to 20th century men’s athletic clubs.

From Equinox to Midtown to Hilton, the Hotel-Health Club Trend Has Officially Taken Off

A growing number of hybrid concepts are emerging from some of the biggest brand names in the hospitality and fitness industries. However, research suggests facility operators will continue to face financial challenges as they develop their amenities.

For some time, it has seemed the line between hotels and health clubs was blurring. In the last year, that line may have disappeared altogether. More and more hybrid concepts continue to emerge, and some are from the biggest brand names in both industries.

In March, Equinox, New York, announced CEO Harvey Spevak would step into a new role, while Niki Leondakis, former CEO of hotels and resorts of Two Roads Hospitality, Englewood, Colorado, would assume his duties in April.

In addition to overseeing the company’s health clubs, Leondakis is now a key player in developing the company’s hotel concept, the first of which is slated to open in 2019. Equinox Hotels “will cater exclusively to the high-performance traveler to serve as the ultimate hotel destination with a 360-degree lifestyle experience,” a media release said.

Last year, the fitness company also tapped former Four Seasons Hotels executive Christopher Norton to lead hotel operations.

(Equinox ranked No. 5 on Club Industry's 2016 Top 100 Clubs list with an estimated 2015 revenue of $1.07 billion. View list here.)

In April, Midtown Athletic Clubs, Chicago, announced its W. Fullerton Ave. Chicago club will re-open later this year as the Midtown Athletic Club and The Hotel at Midtown. The six-story, 575,000-square-foot facility will be the largest of its kind in the country, according to Midtown.

This emerging trend is “history repeating itself,” Midtown President and CEO Steven Schwartz told Club Industry. Schwartz, who holds a bachelor's degree in hotel administration from Cornell University and previously worked for the Hyatt Hotel Corp., likened the trend to 20th century men’s athletic clubs.

If the new Chicago facility is a success—the club portion will open in July, the hotel portion in October—Schwartz is considering developing hotels in other Midtown markets, such as South Florida, he said.

(Midtown ranked No. 14 on Club Industry’s Top 100 Health Clubs list with $101.7 million in 2015 revenue.)

Interestingly, recent research suggests facility operators will have to pull out all the stops to ensure their investments in construction, equipment and staffing are worthwhile. The Cornell Center for Hospitality Research in February found that only 22 percent of hotel guests use on-site fitness amenities. 

"This finding underscores the importance of observing guests' actual use of amenities before deciding to make them standard rather than relying only on surveys of guests' desire for and intent to use the amenities," the report said. “The fitness center figured neither in guests’ initial choice nor their repeat purchase decision.”

Nearly half of Millennial travelers prefer hotels with fitness amenities, versus only 25 percent to 33 percent of adults over 40.

Hilton Hotels & Resorts, McLean, Virginia, is attempting to attract those active travelers with its new Five Feet to Fitness rooms, now available at select Hilton locations.

These fitness-oriented rooms feature an indoor Wattbike bicycle and Gym Rax training station with TRX suspension training straps. The setup also includes an Aktiv Solutions-powered virtual fitness kiosk that offers more than 200 fitness tutorials via a touch-screen display.

The rooms, which cost up to $90 more per night than standard rooms, were created in response to customer feedback, according to a recent Washington Post report. Almost twice as many surveyed customers expressed interest in in-room fitness amenities, rather than a shared, on-site fitness center.

This data presents a quandary for facility operators, who must consider their floor plans, as well as existing and aspirational customer bases, before making any serious commitments on amenities.

The hotel and fitness industries are both in evolutionary states, Larry Yu, a hospitality management professor at George Washington University, told the Post. This makes facility operators reliant on trial-and-error methods to discover what works best for them, as no catch-all business strategy exists.

“Evolving from Baby Boomers to Millennials, fitness has really become a lifestyle,” Yu told the Post. “It’s not just your typical amenity now. Hotels are all working very hard to figure out how they can provide the best service and equipment to the guests because the guests expect and value those.”

 

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