Choice Hotels CEO Outlines Strategy to Sell $450M in Hotels
New Choice Hotels CEO Dominic Dragisich outlined a strategic reset at a Bank of America conference, targeting U.S. room growth and selling $450M in hotels.
Stock photo for illustration only, not from the actual event
- Choice Hotels CEO Dominic Dragisich unveiled a strategic reset during a Bank of America conference
- The company aims to restore U.S. net rooms growth to its historical 2 to 4 percent annual pace
- Choice plans to recycle capital by selling roughly 20 owned properties valued at about $450 million starting in early 2027
Choice Hotels is shifting its strategic direction under newly appointed CEO Dominic Dragisich, who officially took the helm on August 31. Speaking at a Bank of America conference, Dragisich declared that the company's era of aggressive building and acquiring is officially over, and that management is pivoting back to core fundamentals to drive future performance.
This strategic reset comes after several years in which Choice invested heavily in purchasing brands such as Radisson and WoodSpring, developing proprietary Cambria and Everhome prototype properties, and culling underperforming locations. While these moves expanded the company's footprint, they also caused room-count growth to decelerate and left revenue generation lagging behind key industry peers.
Stock photo for illustration only, not from the actual event
Under the new leadership, Dragisich has laid out three core priorities to correct course:
- Reigniting net rooms growth in the United States to return to the historical 2% to 4% annual pace, compared to projected global growth of 1.5% this year.
- Transitioning to an asset-light business model by recycling approximately $650 million of capital, which includes selling roughly 20 developed or acquired properties valued at about $450 million, with the first wave targeted for the first half of 2027.
- Closing the revenue-per-available-room gap to reclaim and expand market share against major competitors like Wyndham.
"Returning to our roots."
Dominic Dragisich
Choice Hotels' pivot toward a capital-recycling and asset-light framework highlights a broader hospitality industry trend where major franchisors prefer collecting fees over shouldering real estate ownership burdens. By divesting owned properties, the company can redirect capital toward proprietary revenue-generating technology and procurement efficiencies, offering critical relief to hotel owners currently squeezed by high labor, financing, and operational expenses.
The ultimate objective of the turnaround plan is to enhance profitability for franchise owners who are currently squeezed by rising insurance, labor, tax, and financing costs. To support them, Choice is deploying advanced tools including an automated meeting-planner booking system, a procurement program that reduces furniture and equipment costs by up to 20%, and an artificial intelligence tool named "Charlie" designed to deliver measurable operational savings.
Source: Skift
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