Boutique hotels in South Africa are showing an inclination to follow international trends for that niche in the market. The use of property by Boutique hotels is unique. Each individual hotel has the potential to both reflect the status of its neighbourhood and influence the character of the adjacent real estate in a specific locale.

In 1984, Ian Schrager opened Morgan’s Hotel on an unremarkable stretch of Madison Avenue in Manhattan, New York. Together with a number of other hotel properties and subsequent Schrager projects, the hotel is credited with ushering in a new design milieu and launching the era of the boutique hotel.

Now, over 28 years later, the influence of the boutique hotel has permeated every facet of the hospitality industry. Boutique, no longer the sole province of the rich and hip, is now big business, and its impact is increasingly felt, from once-forlorn airport hotels to luxurious urban resorts.

Last year saw two South African Boutique hotels winning awards at the World Luxury Hotel Awards at Pan Pacific Kuala Lumpur in Malaysia: the Upper Eastside Hotel located in Woodstock and the Robertson’s Small Hotel in the town of Robertson.

Most South African boutique hotels are up-market; in fact they make up a significant percentage of the five start alliance list of 41 best hotels. In South Africa boutique hotels caught on like anywhere else but up until now it remains the domain of the upmarket and luxurious, renovating old buildings like the Rosebank Post Office in Rosebank or transforming old Mansions with rising rates and pricey upkeep, the Winston in Melrose for example. The influence on an area is marked. Where a boutique hotel has moved into an area there has been a discernibleup scaling effect on the location as a whole.

Similarly there is an influence from the outside in. Many boutique hotels, particularly those in buildings that have undergone adaptive reuse, draw their uniqueness, brand character and guest experience from the place and underlying building fabric in which they are located. The neighbourhoods, civic realities and historical context are all highly influential in the design themes of many boutique hotels thereby making them one-of-a-kind, memorable experiences that are targeted at a specific kind of audience.

An international trend that has seen its mark in South Africa is the movement towards the budget boutique hotel. Some may argue that by definition budget is not boutique. A rudimentary perusal of the web reveals many a budget hotel marketing itself as boutique these days. In 2013 we will probably see increased conversion and consolidation as less successful hotel businesses get scooped up or shut their doors. There is likely to be a continued lack of financing for both early and late stage hotel businesses without a clear road to profitability. We may expect an ultra-cautious approach to first-time hotelier entrepreneurs with little track record on the back of continued economic uncertainty.

Since the 2007-2009 recession, independent hotels have been more open to joining well established entities to gain access to a larger customer base through global reservation systems and marketing campaigns. Established hotel operators have used their “conversion” brands to grow and capture high entry-barrier sites despite restricted debt and stifled new developments.

In South Africa there is a clear movement to take what used to be the bigger B&B’s and expand properties, creating boutique hotels with the view to up scaling the class of clientele and raising capital expenditure to increase profits in the long run. This narrows the gaps between upmarket B&Bs and the conventional boutique hotel. This trend shows a further influence on suburban areas and commercial nodes alike. Not unlike the canary in the bird cage, if the local boutique hotel closes down it’s bad news for the neighbourhood.

Boutique hotels around the world have an authenticity going for them. They are particularly suited to conversions of historic or interesting buildings. By doing this with sensitivity to the materials used and the original structure, they can be among the most sustainable and authentic hotels in terms of the built environment. The influence on local real estate proves to be a positive one and South African’s are keeping up with world trends.