IHG's top development executive for the Americas has put conversion deals at the center of the company's growth conversation. Mark Sergot, chief development officer for IHG Hotels & Resorts in the Americas, sat down with Hotel Dive at the Lodging Conference and described what he called a conversion "phenomenon" reshaping the deal market.

The interview itself is brief in its public summary. But the framing signals where IHG believes the next tranche of North American rooms will come from. Sergot identified three brands — Hotel Indigo, Garner and Ruby — as the vehicles with the most room to run.

What is the conversion play?

Conversions reflag existing hotels rather than build new ones. For owners, the math is direct. A conversion skips ground-up construction, the most expensive and slowest path to a brand affiliation. For IHG, each conversion adds rooms to the system without the company spending development capital, since franchisees and owners carry the renovation cost.

Garner is IHG's conversion-focused midscale brand, launched to capture independent and under-flagged properties. Ruby, by contrast, targets the premium lean-service segment, an urban model built around smaller footprints and stripped-back operating costs. Hotel Indigo anchors the boutique end of IHG's upscale portfolio.

What Sergot did not say, at least in the material released, is how many signed deals each brand carries or what the average renovation cost per converting property runs. Those numbers would tell owners whether the conversion pitch pencils out against staying independent. Until IHG discloses them, the "phenomenon" remains a direction, not a verdict.

Where is the white space?

Sergot told Hotel Dive he sees white space in the market, a signal that IHG views segments of the Americas map as under-branded rather than saturated. Midscale and upper-midscale conversions are the industry's most contested ground right now, with rivals pushing similar reflagging programs aimed at aging independent assets and owners weighing exit or reinvestment.

The economics favor the franchisor more than the owner in the first year, because rebranding fees and program compliance costs land before the new flag lifts revenue per available room. Owners typically underwrite a conversion on the assumption that distribution, loyalty traffic and reservation delivery will close that gap within a defined payback window. IHG has not stated publicly what payback window it is pitching.

What happens next?

The Lodging Conference setting matters. Development officers use the annual Arizona gathering to test owner appetite before committing pipeline targets. Sergot's decision to spotlight three brands, rather than IHG's larger mainstream flags, suggests the company sees its near-term Americas growth concentrated in segments where conversions, not new construction, dominate. Watch the next pipeline disclosure for signed-and-opened counts by brand; that is where the phenomenon either proves itself or stays a talking point.

By Marcus Bennett