InterContinental plans $1bn revamp of Holiday Inns

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InterContinental unveiled a $1bn makeover of its Holiday Inn hotel chain yesterday, the first major overhaul since the brand was launched in 1952.

Most of the rebrand costs will be taken on by hotel owners and franchisees who will invest between $50,000 and $200,000 each over the next three years. InterContinental will invest up to $60m, which will be reported as a one-off charge.

The company, the world's largest hotel operator, said the programme will generate growth in revenue per available room of 3 to 7 per cent.

Andrew Cosslett, chief executive of Intercontinental, said: "Holiday Inn is a legend in the industry. It is an iconic brand but it is important to keep its image fresh in order to stay ahead of the game."

Feedback from franchisees had been positive, he said. "We have spent a considerable amount of time getting the facts and the insights to enable us to make these changes, in partnership with our owners," he added. "We want our guests to get as much enjoyment from Holiday Inn hotels over the next 50 years as they have over the last 50."

The relaunch will include the first change to the chain's green logo in 50 years, redesigned signage, new bedding and showers. It is scheduled for completion by the end of 2010.

Rick Takach Jnr, chairman of the International Association of Holiday Inns, which represents nearly 3,000 of Intercontinental's hotel owners and operators, said Holiday Inn "has a proud history". "IHG is now demonstrating its commitment to keep the brand fresh in the minds of both hotel owners and guests with its renewed focus on quality and innovation," he added.

Holiday Inn, which was founded in Memphis, Tennessee, operates more than 400,000 rooms globally with a development pipeline of more than 110,000 rooms.