Dive Brief:

• IHG Hotels & Resorts has partnered with 5G LLC, a provider of connectivity technology solutions for the real estate industry that will work to connect the brand’s hotel rooftops with 5G networks, according to a press release.
• The partnership will enable owners of more than 3,800 IHG-branded hotels in the U.S. to develop a long-term digital revenue stream.
• While IHG Hotels has several expansions and renovations planned for some of its top properties in 2023, IHG’s VP of Operations Colin Macdonald said the 5G enhancement is different because it can benefit any property regardless of scale.

Dive Insight:

The new collaboration between IHG Hotels and 5G LLC is expected to create revenue that will enhance how the brand’s properties drive returns for their investments, according to Macdonald.

“For IHG-branded hotel owners, this agreement represents a unique opportunity to gain a revenue stream by leveraging unused space on a property’s rooftop without added owner costs,” Macdonald said in a press release. “One advantage from this collaboration is that 5G LLC can market to multiple wireless carriers on an owner’s behalf for increased revenue potential.”

According to 5G LLC’s website, the carrier bears all installation and operating costs, and the property owners retain full control and decision-making around the individual lease. In IHG’s case, the lease becomes the franchisee’s asset and can be held or monetized with the building. IHG has extended the program to its owners free of charge, Macdonald said.

Typical rental rates for tier-one carriers across the country range from $1,500 to $4,000 per month — depending on roof height, building location and other factors — Jason Lund, managing director of technology infrastructure at JLL, said in a Building Owners and Managers Association International post. He added that lease terms are typically 10 years with multiple five-year renewal options.

For IHG, carrier lease opportunities will span a variety of property types and sizes. It will first be rolled out in major U.S. markets, with secondary markets to follow, Macdonald said.

“Essentially, this partnership will provide 5G access to hotels in any market containing 5G infrastructure, offering advantaged terms to properties that otherwise might miss out on the benefits and value of such enhancements due to their lack of scale,” he added.