Every night, as children snuggle into their beds, parents around the world tell the tale of The Sandman, as they have for generations. (The origins of the story lead back to Greek mythology’s Morpheus, lord of dreams.) The modern fable suggests that, when you go to sleep, a mythical figure sprinkles magical dust into your eyes to bring you sweet dreams. Come morning, you rub the sleep from the corners of your eyes — evidence of The Sandman’s visit. If you’re not familiar with the legend, you can probably still hum the melody from The Chordettes’ pop hit “Mr. Sandman” circa 1954. And there’s a very good chance you’ve driven by an aptly named Sandman Hotel — maybe spotted at the side of the highway — a comfortable place to rest, relax and get a good night’s sleep.
Sandman Hotel Group, which recorded estimated gross sales of $230.1 million in 2016, is celebrating its 50th anniversary in the hospitality industry this year. The first location — a 35-room inn — was opened in Smithers, B.C., by Bob Gaglardi, in 1967. Over the next decade, the brand opened 15 new locations throughout the province, including a high-rise 300-room hotel in downtown Vancouver. The Sandman brand continued to expand during the following 30 years — opening locations in Alberta, Saskatchewan, Manitoba, Ontario and Quebec — with a total of 32 locations. The business is still growing today, even beyond Canadian borders — in 2012, Sandman hopped across the pond to open two locations in the U.K.
“We’ve had steady growth throughout the history of the company and we’ll be very busy over the next two years, with about 3,000 rooms coming on board,” says Taj Kassam, president and COO of Sandman Hotel Group, which includes Sandman Hotels, Sandman Signature locations and The Sutton Place Hotels. Having been with the company for 37 years, Kassam has witnessed and nurtured the growth himself. There are currently 48 Sandman and Sandman Signature Hotels (46 in Canada and two in the U.K.), along with three locations under The Sutton Place Hotels brand, in Vancouver, Edmonton and Revelstoke, B.C., for a total of 51 properties and 8,585 rooms.
“In 2017, we opened a 154-room Signature addition to our Calgary Airport Sandman, so we have two brands within one property. In 2018, we’re opening our first Newfoundland location, with 200 rooms in St. John’s, as well as new locations in Hamilton, Ont., Ottawa, Sherwood Park, Alta., and Aberdeen, Scotland — our third hotel in the U.K.,” Kassam says. The company also recently purchased the Dallas Stars National Hockey League team and plans to open its first U.S. location in Plano, Texas in 2018. New properties reaching from Dartmouth, N.S., to Saskatoon are slotted for 2019. “We’re a private Canadian, family-run company and it’s exciting that a lot of our focus is shifting outside of Canada,” says Tom Gaglardi, chairman and CEO. “We’re ramping up our capabilities in the U.S. and U.K., with about a dozen hotels planned for markets outside of Canada.”
What drives this success? Sandman prides itself on the fact that it owns and operates every one of its locations — none are franchised or managed by a third party — and it intends to stay this way. Sandman’s parent company includes the hotel brands, as well as its own construction company (used to build all of its locations, of course), plus sports teams and its own well-recognized foodservice brands, which operate within the hotels and as stand-alone restaurants.
“In 1990, we had restaurants in the hotels, but we wanted to add strength to the business through a branded restaurant. We were lucky to get the franchise rights for Denny’s in Western Canada and, in 1998, we bought the Moxie’s Grill and Bar brand outright,” Kassam says. All of the company’s hotels include one of its branded restaurants. Over the years, Sandman has also introduced the Chop Steak House and Bar, Bar One and Shark Club Sports Bar and Grill.
While the hotel industry competes with online travel agencies, Sandman has worked to introduce new opportunities for guests to receive better rates by booking directly. In January 2017, it launched its Members-Only-Rates program, where guests sign up with the guarantee to always receive lower rates than what the online agencies are offering and what non-members see on the website. The program has been a huge win for Sandman, with 25 per cent of all room nights sold coming from Members-Only rates.
The company also recently hired developers to build a custom, in-house booking engine, giving them the capability to drive direct bookings. “Our booking engine provides a means for us to market towards our guests and grow direct business. Along with that direct business, the data collected is owned by Sandman and is fully scalable as we grow. It’s something we had the foresight to do and we know we’re going to need it. It’s unique in the industry and something we’re very proud of,” says Kayla Hepworth, Communications manager for Sandman Hotel Group and The Sutton Place Hotels. The company uses the data to finesse marketing and advertising campaigns to best fit its ideal guest. The approach has proven to be both successful and profitable.
Another unique achievement for Sandman was its decision to integrate Bitcoin payment in July 2014. It was the first Canadian hospitality company to begin accepting the alternative, worldwide cryptocurrency and digital-payment system — the first decentralized digital currency. “All a guest needs to do is go to the website and book a room. They click the option for Bitcoin payment and then receive an e-voice. Once they accept it and make the Bitcoin transfer, the reservation is confirmed. We noticed its popularity growing in the tech world, especially when Vancouver hosts TED Talks, and we knew it was something we should do,” Hepworth says. Since then, a number of other hotels have followed suit. Sandman is also building a six-storey wood-frame hotel — the first of its kind in Ontario — making the most of a revised building code. “The six-storey wood-frame hotel is a very positive move for building generally and something that many provinces have embraced, because it creates additional density in a more affordable way in urban settings,” Gaglardi says. “It means more rooms on a smaller footprint and that’s a good thing. In Toronto and Vancouver especially, affordability is a huge issue. The best way to solve that is to improve density.”
While revenue and growth are priorities for Sandman, the company is also focused on creating great places to work for its employees. Its official Open Door Policy gives every team member the opportunity to connect with regional directors, VPs and even the president on a daily basis. There’s also an anonymous hotline employees can call to discuss any issues if they don’t feel comfortable talking to a supervisor. For many consecutive years, every one of its hotels in Alberta has been presented with the Employer of Choice award by the Alberta Hotel & Lodging Association.
Sandman is committed to taking care of its staff, as well as the communities in which the business operates. “We do business in the community and we want to invest back into it. It’s that simple,” Kassam says.
The company proudly sponsors the Western Hockey League, Canadian Sports Institute, Arts Club Theatre Company, Canadian Avalanche Centre, the BC Minor Midget League and many others groups and organizations — including a significant partnership with the Juvenile Diabetes Research Foundation (JDRF).
“Five years ago, our son was diagnosed with Type-1 diabetes at age six. I’ve been close to the foundation, as we’ve been learning how to manage the disease and supporting efforts to eradicate diabetes,” says Gaglardi, who presented a generous $3-million donation to JDRF in April 2017. The funds will support research for a cure, focusing in the areas of encapsulation therapy and beta-cell replacement and regeneration. “My family felt it was something we should step up and do. The money is going toward promising research to find a cure,” he says.
Sandman Hotel Group has grown from a small, family-run inn to become an innovative, generous, rapidly growing hospitality business — an undeniable Canadian success story.
Written by Lindsay Forsey