Boutique hotels a growing trend in Arkansas
by Dwain Hebda
Nebraska transplant and hotelier Bhu Makan leans back in his seat and applies a liberal dose of fresh berries to his morning oatmeal. He’s seated in the first-floor bistro of The Burgundy Hotel, a boutique property he owns in west Little Rock. At nearby tables, well-heeled business guests chat about the upcoming day’s itinerary as the wait staff circulates unobtrusively among the gleaming marble-topped tables.
Makan is well-schooled in the innkeeper’s art of seeing everything at once, including what’s right in front of him. So, while you know he’s taking note of a coffee cup running low over there or a guest looking lost over here, he never lets his eyes stray. Everyone and everything here, it seems, is worthy of his attention.
“The economy has been good for quite a long time,” he says. “People are looking for an experience versus a stay. You could wake up in a Hampton Inn and not know what city you’re in, but you are not going to find another Burgundy.”
“That’s why I think consumers are coming to us. They’re looking for something different. They’re traveling a lot, and it’s the generation we’re in that we look for more experiences than just stays.”
Throughout Arkansas, the boutique hotel is fast emerging as the preferred option for discriminating travelers. Once in very limited supply, the smaller, plusher boutique hotels are popping up all over the state with more on the drawing board.
The Burgundy is one of the newest of these properties, a reclaimed Best Western that Makan purchased in 2002 and recently spent a tidy sum to renovate into the sleek, sophisticated space it is.
“We kind of always knew that this property was not a Best Western, but we could not find a brand that would take us because of the number of rooms that we have,” he says. “That meant there’s not as much revenue in us for (hotel chains) so it was difficult. That’s probably one of the biggest reasons that we stayed with Best Western as long as we did.”
Makan aligned the property with a couple of brands en route to discovering that it wasn’t so much the name above the door as it was the service and environment guests encountered on the other side of it that mattered. Hilton ultimately proved to be the perfect fit via its Tapestry Collection, providing would-be guests with a seal of approval regarding level of service and amenities.
“People want quality and in hospitality, that’s not always easily defined,” Makan says. “You go to Toyota, Buick, Ford, you can easily distinguish the quality of what you’re going to get. With hotels, being independent and boutique, it’s really hard to determine what you’re going to get.
“When we were with Choice, Choice was not the level we wanted to be and that’s why Hilton was such a perfect fit for us. Their clientele is a little bit better fit and generally show better loyalty among business travelers. It has worked out well in that sense.”
Boutique hotels have existed well before there was a term for them. Small, independent locations, impeccably appointed and serviced, have long been on the hospitality menu. However, with the rise of the chain hotel, not unlike fast food, droves of travelers sacrificed service and ambiance for accessibility and price, says Nathan Hamilton, who co-owns the Baker House in North Little Rock with his wife Stacy.
“Chain hotels are wonderful because you get the consistency, and you know what you’re getting. And as a traveler, that can be very appealing,” he says. “But with the internet, we’re now being able to see reviews. And reviews for a boutique hotel are one of the most important things ever.
“We’re on Expedia, which is where we get 70 percent of our bookings. We’re on Airbnb as well. We watch those like a hawk, because all of those reviews are what allow travelers who used to be wary of a unique place, to now have the confidence. They look at reviews first and if they’re good, they’ll go, ‘OK. I feel comfortable choosing this.’”
Even by boutique standards, the Baker House bucks trends with only five rooms and a detached guest cottage. However, this lends to the hyper-focused customer experience and connectedness that guests in this category crave.
“If you define ‘boutique’ simply as an independent property that has a unique character, then that’s us,” he says. “We’re a stunning, extremely well-maintained 19th-century Victorian house right in the middle of Argenta. But we’ve also taken great strides and worked very hard to make the inside modern and comfortable.
“You know you love your grandma, but you don’t so much love her furniture. So, we’ve got all very new comfortable furnishings, and we understand that those types of amenities are what we have to have these days.”
These modern touches include heightened technology such as electronic door locks, reservation systems and check-in, and the ubiquitous high-speed Wi-Fi balanced by the Hamiltons’ personal touch in directing guests to the surrounding neighborhood attractions, often by text. It’s a blend of high tech and high touch that’s been clicking since the couple opened in April.
“We built our business model crossing our fingers and scared to death, initially,” Hamilton says. “I ran the numbers and really hoped that it could pay for itself at about 40 to 50 percent occupancy. That is what I was hoping for. In July, the third month we’d been open, we hit 92 percent occupancy.”
If those numbers aren’t enough to bolster confidence, there are plenty of industry statistics to back up boutique hotels’ staying power. Ten years after these properties started appearing in earnest, boutique hotels have become the fastest-growing segment of the hospitality industry, up nearly 9 percent since 2013 according to IBISWorld.
In 2018, this translated to revenue of $17 billion which helps explain the growth of the concept in Arkansas, particularly in areas that are already drawing tourists. From historic repurposed buildings like The Waters in Hot Springs to mid-tier chain remodels like the Doubletree on Lake Hamilton, small, unique and sophisticated are the new watchwords for success.
The concept works so well, it’s inspiring its own chains, such as the eight-unit 21c Museum Hotels, which has operated a Bentonville property since 2013 and continues to build all over the country. Like all boutique hotels, 21c connects the guest to community experiences, but unlike other properties, it’s part of the destination in and of itself.
“We have a lot of people driving to Bentonville to stay with us because of our service and our quality and the fact that we offer a different experience,” says Emmanuel Gardinier, area general manager. “But we are also one of the true destinations here in Bentonville.
“Our main thing is, we’re a museum of contemporary art that happens to have guest rooms and a restaurant, if you will. All our big spaces are gallery spaces. That makes the guest experience very different; you can sleep at a museum, you can visit a museum.”
The hotel leverages art and art lovers not just by residing in the shadow of the acclaimed Crystal Bridges Museum of American Art, which it does, but in offering its own rotating collection curated independently.
“Like a true museum, we change the art at least every 8 to 12 months which is not the same piece of art that you’re going to have the next 20 years,” Gardinier says. “Guests don’t just come to us, they mix it up with a visit to Crystal Bridges, and soon we’ll have another museum opening in town in February. That will be a big part of the whole experience.”
Gardinier says running a hotel that doubles as its own attraction is well-suited to a visitor-savvy community like Bentonville. Having worked exclusively in boutique hotels in 12 countries, he said Bentonville is unlike any confluence of attractions he’s ever experienced, packaged and sold with formidable skill by the local promotions machine.
“I was born in Paris, but even being a kid of a giant city, I don’t like big cities. I always prefer to be close to nature in a small environment,” he says. “Bentonville is Mayberry meets Wall Street. You’re on the square, you’re going to see happy families, and you’re going to bump into someone who worked in Hong Kong for five years.
“Nature is incredible around here, you’re within a five-hour distance of really cool places, and the people are genuinely nice. We all work together as a destination, also; that’s usually not the case in big cities. It’s just one of those weird places that is very comfortable and very cool because it’s out of the way.”