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Radisson Is Bringing its Cosmopolitan Blu Brand Home to the U.S.December 19, 2011
Gita Sitaramiah, St. Paul Pioneer Press, December 18, 2011
Radisson has a lot riding on Blu.
Carlson's flagship brand has gotten a little tired in the half century since the Minnetonka-based company got into the hotel business. In July, J.D. Power and Associates ranked the chain 10th out of 11 for guest satisfaction in its upscale peer group, finishing below Hilton Garden Inn, Aloft and Courtyard, and just ahead of Crowne Plaza. Radisson received low scores in every category, including hotel services, food, facilities and cost.
Now Radisson is bringing its higher-end Blu brand -- well regarded internationally -- stateside, hoping its hip, sleek vibe will win over travelers who wouldn't have considered its frumpy sibling.
Radisson Blu had its first North American opening in Chicago last month, and the early reviews are strong. The hotel occupies the first 18 floors (334 rooms) of the new Aqua Tower. It offers sleek finishes, indoor and outdoor pools, wall-to-ceiling banquet room windows and two room styles: one with hardwood floors and clean Scandinavian styling and another darker, more modern one with granite countertops and blue carpeting. Contributors to TripAdvisor have raved about the stunning architecture, "dazzling" lobby bar, huge fitness center and prime location, one block from Millennium Park.
The $125 million hotel is part of a $1.5 billion luxury rebranding and face-lift for Radisson that Carlson announced last year.
"I think it's very exciting to see that at the end of our second year there's some clear progress," said Javier Rosenberg, chief operating officer of Radisson Hotels. Rosenberg has been with Carlson less than a year, but was promoted this month after overseeing the Chicago opening. He will play a key role in transforming Radisson's hotels in the Americas.
The three-part plan for the Radisson brand includes opening "upper-upscale" Radisson Blu hotels in the U.S., including one at the Mall of America in Bloomington, upgrading some existing Radissons and eliminating some locations from the brand.
Blu locations also continue going up outside the U.S. On Thursday, the St. Martin location reopened as the Radisson Blu Resort, Marina & Spa.
Formerly known as Radisson SAS, the hotel brand was renamed Radisson Blu in 2009. SAS International Hotels date back to 1960, and entered into partnership with Radisson in 1994.
"Radisson Blu has a great brand name in Europe and Asia," said Rosenberg, a native of Argentina who in 20 years in the hospitality business has managed hotels in the U.S., Mexico, Spain and Singapore.
The Mall of America Blu being built by Mortenson Construction will feature a FireLake Grill House & Cocktail Bar, spa and fitness facilities and 23,000 square feet of meeting space. It will be the megamall's first hotel connected by skyway when it opens in March 2013, offering 500 rooms.
Carlson also is planning to convert Radissons in downtown Minneapolis and Philadelphia into the Blu concept. Carlson invested $85 million this year in upgrading other Radissons nationwide.
"I think it's remarkable to see that a quarter of the hotels were renovated this year," Rosenberg said.
Jeff Weinstein, editor-in-chief of Hotels magazine, has toured Chicago's Radisson Blu and calls it a game changer for the brand.
Weinstein praised the upscale finishes and noted that Carlson is putting its own money into development, showing that it's serious.
"They really needed to send a message to the hotel development community that the Radisson brand is a true four-star brand," he said.
Choosing Chicago for the first U.S. Blu was a smart move, said Steve Sherf, president of Hospitality Consulting Group in Minneapolis.
The Radisson brand got tripped up when some downtown locations the company picked up in the '80s didn't live up to its brand quality, he said.
By choosing a big city with major airports, Carlson poised the Radisson Blu for widespread exposure fast, he said. Sticking with the Midwest was also a good idea.
"Radisson has kind of a higher level of awareness in the Midwest than they might on the coasts, so Chicago was probably a very good place to kick it off," Sherf said.
Real estate observers believe New York City would be another natural location, though Carlson hasn't announced plans yet for any such deal.
Carlson has made the Radisson turnaround part of its Ambition 2015 strategy, which is focused around Carlson's global push to double its international hotels from 2010 to 2015.
Privately held Carlson operates 1,070 hotels in 80 countries, including Radisson, the midpriced Country Inns & Suites, Park Inn by Radisson and Park Plaza. Hotels accounted for about $1.3 billion of Carlson's $4.2 billion in revenue last year. The company says more than 170,000 people work for its brands worldwide, which include more than 900 TGI Friday's restaurants and a majority stake in Carlson Wagonlit Travel, a business travel management company.
The Radisson Blu Chicago debut comes as the economy slowly recovers. The timing could serve Carlson well if more development is sparked.
"We're still not at the point where new development can be economically justified in other than unique circumstances but I think we will be there in the next year," Sherf, the consultant, said.
Carlson executives expect some growth next year. "But we do see it on a moderate pace and there are so many mixed messages," Rosenberg said.
The push to improve the U.S. Radisson experience will help Carlson maintain the home turf during global expansion, Rosenberg said.
The Radisson Blu will likely compete for the same customers and locations as Hyatt, Marriott and Starwood hotels.
Developers often seek out those brands within the industry and Carlson is trying to ensure that Radisson Blu is mentioned in those conversations.
As Hotels editor Weinstein put it, "One hotel is a nice start, but they have a way to go."
Gita Sitaramiah can be reached at 651-228-5472.