ROCHESTER, NY—For over 40 years, DelMonte Hotel Group, a full-service management and development company, has owned and operated hotels throughout New York State. Now, the Rochester-based company is pursuing strategic opportunities throughout the Northeast starting with the opening of its first property out of state.
The Hilton Garden Inn Pittsburgh Airport South/Robinson Mall debuted earlier this year. DelMonte Hotel Group secured construction financing for the project through First Niagara Financial Group. The five-story, 118-room hotel will provide access to nearby attractions, shopping, restaurants and the Pittsburgh International Airport.
“Pittsburgh is an exciting market with a strong base of demand generators, including healthcare, education and energy,” said Alex DelMonte, president of the DelMonte Hotel Group. “This new development fits our strategy to continue to find growth opportunities in larger, more diverse markets.”
DelMonte Hotel Group currently owns and operates a portfolio of 14 hotels that include Marriott, Renaissance, Courtyard, Residence Inn, Fairfield Inn and Hilton Garden Inn brands throughout New York State. In addition to the recent opening in Pittsburgh, DelMonte Hotel Group has received franchise approval and financing for two more new-build projects out of New York State.
The company currently has under development a 160-room Residence Inn by Marriott in Cleveland, located adjacent to the Cleveland Clinic and Case Western Reserve Health Education University. The project is slated to open in fall 2017. DelMonte also has a second development just outside of Cleveland, located at a 50-acre, lifestyle mixed-use project in Beachwood, OH. The 145-room hotel will become the company’s first AC by Marriott property. Construction will commence on both projects in late fall of 2016.
The company’s overarching strategy to expand in new markets focuses on developing projects with high barriers to entry. “We believe that the future traveler wants an urban experience no matter where they are staying,” said DelMonte. “As a result, we are focused on lifestyle centers, in which our guests can walk out of the door and have all of their amenities available to them.”
To achieve its vision in new markets, the DelMonte Hotel Group has been exploring franchise opportunities with the latest lifestyle brands such as AC Hotels by Marriott, Moxy Hotels and Canopy by Hilton. “These brands present a great opportunity for development in the future,” said DelMonte.
Through three generations of leadership, DelMonte Hotel Group has grown its hotel portfolio from a single, full-service Marriott hotel in 1973 to a portfolio of full-service, select-service and extended-stay products. As one of the oldest Marriott franchisees, DelMonte Hotel Group built its first full-service Marriott property in 1973. Ernest J. DelMonte patented the Delcrete Building System, a concrete modular construction system. With this system, the company built 18 Marriott-branded hotels.
Since the company’s founding, DelMonte Hotel Group continues to evolve its strategic approach. When John DelMonte became president of the company in 1992, the company was strictly a full-service hotel company. At the time, Marriott was pushing its newest brands, Fairfield and Courtyard, according to the company. John saw this as an opportunity to expand the portfolio. By 2002, John had grown the company from two full-service hotels to a portfolio of 18 hotels.
Alex DelMonte joined the organization in 2012 as president while John DelMonte took on the role of CEO. While in the past, DelMonte Hotel Group was focused on building hotels in suburban markets, the new focus of the company is on mixed-use developments as well as urban infill opportunities.
“Markets with university and hospital components to them are of particular interest to us,” said Alex DelMonte. “This new strategy has resulted in DelMonte Hotel Group broadening its footprint outside of New York State, as well as expanding its brand relationships.”
In 2015, DelMonte Hotel Group opened a 136-room Hilton Garden Inn within a 15-acre, mixed-use development adjacent to the University of Rochester Medical Center. “DelMonte Hotel Group has also taken the opportunity to sell some of its assets in the last few years in an effort to take advantage of the sellers’ market,” said Alex DelMonte.
Elsewhere in New York State, DelMonte Hotel Group is currently developing projects in Albany, NY, slated to start construction in 2017. The first project in Albany is a dual-branded property with 220 guestrooms. The second project is an extended-stay hotel in downtown Albany, part of a mixed-use development with retail and residential components. “We have not received franchise approval for these two developments but anticipate announcing the brands soon,” said DelMonte.
Most of DelMonte Hotel Group’s new projects are financed through a regional bank, in which the company has had a long-standing relationship. “Our preference is to work with balance sheet lenders as we shy away from CMBS debt,” said Alex DelMonte. “With our projected growth in the future, we have entered into partnerships with institutional investors as well as individual investors in order to be able to take on new opportunities as they arise. We are very interested in building relationships with new partners as we continue to expand our footprint.”
DelMonte Hotel Group plans on continuing its growth through development, acquisitions and the management of third-party owned hotels. The company’s in-house management team oversees over 800 associates. “DelMonte Hotel Group has been the recipient of Marriott’s highest awards for all brands and anticipates the same for our new Hilton Garden Inn properties,” said DelMonte. “We feel that we can bring the same commitment of service to guests of hotels that we would manage for third-party owners.” HB
