Travelodge looks for more hotel sites with The Gym Group

The companies currently 'co-locate' at three sites in the UK - Guildford, Plymouth and Waterloo with Travelodge set to open a hotel above The Gym Group's Wembley site in early 2014. 

Paul Harvey, managing director international & development at Travelodge said current co-locations had worked 'enormously well' for both parties so it made sense to look for sites together.

"This really helps us with our growth plans for London and the South East," he said. 

Budget opportunities​

Travelodge and The Gym Group's latest £70m plans will see the companies looking for sites with conversion or development opportunities or within mixed-use schemes that can be occupied jointly. Their search will focus on London and the South East.  

The Gym Group, which charges as little as £10.99 per month for membership at its 29 locations in the UK, is looking to expand rapidly over the next few years as it fills a gap in the market for a low-priced contract-free gym that can be accessed at any time of the day or night. 

Both companies plan to capitalise on the fact that budget hotels and budget gyms are still in the minority in the UK. Currently budget hotel rooms in the UK comprise 16 per cent of the market while just 4 per cent of fitness clubs are operated by the budget sector. 

“The increasing popularity for budget alternatives across a number of sectors reflects the wider consumer market’s demand for value. Our expansion plans are ambitious; we will have 32 sites open by January, and look to continue the same level of growth through 2013," said John Treharne, chief executive of the Gym Group. 

“We welcome any opportunity to co-habit with like-minded companies. It allows both parties to challenge the existence of their mid-market competitors, and ultimately offers the consumers better value for money”

Compatibility​

Harvey said the fact that both companies followed a leasehold business model, were budget brands and had mutually beneficial needs for space meant they were ideal partners. The model also means that the companies can secure locations that would have been unaffordable if looking separately. 

“Given the space requirements of both companies, as well as our compatible business models, it really is the perfect fit: The Gym Group on the ground or lower ground floor and Travelodge on the floors above,” he said. 

Travelodge already co-locates other sites with pubs and supermarkets - last year it announced plans to enter a deal with Waitrose​ to open hotels above three supermarkets in Aylesbury, Sidcup and Vauxhall as well as joining forces with Greene King, JD Wetherspoon and Mitchells & Butlers.