Magnuson Hotels, of Spokane, says it has added nearly 200 hotels to its independent-hotel marketing group in the past two months and has boosted its revenues 42 percent over the last year.

The 6-year-old company, which markets independent hotels on the Internet and provides reservation management services to them, expects to have 1,000 hotels in its network by the end of the second quarter, though Tom Magnuson, its CEO, declines to say exactly how many hotels are in the network currently.

The company added 100 new hotel activations in its marketing network between Nov. 15 and Dec. 15, and nearly as many again between then and Jan. 15, he says. It charges its members a fee for each booking made through its reservation system, which it provides online, and through a call center it operates. It also derives some revenue from a system-access fee that it charges its clients based on the number of hotel rooms they have.

"We are an external sales force to deliver the highest revenue in the simplest way at the lowest cost," Magnuson says.

Separately, Magnuson Hotels also expects to double this year the number of hotels affiliated with the branding program it offers, through which independent hotels adopt the Magnuson Hotels name, Magnuson says. Since launching its Magnuson Hotels brand in September 2007, it has recruited about 50 hotels in the U.S. and Canada.

"We'll easily double that this year," Magnuson says.

Through that branding program, the company offers its clients a way to identify themselves as part of a larger group, Magnuson says. In the program, it also offers assistance with changing a hotel's identity, including designing logos, which can be a significant expense for a hotel.

He claims the company's brand differs from that of a franchise chain in that it provides hotels a financial incentive for meeting performance goals, in the form of a 10 percent rebate on their reservation fees once they hit revenue goals established with Magnuson Hotels for each six-month period.

Because of the continued growth in both the independent hotel group and the Magnuson Hotels brand, Magnuson Hotels has hired about eight new employees over the last year, and recently has brought in-house a call center that it had first tested last year by contracting with a company in Salt Lake City, Magnuson says. Magnuson Hotels now employs about 40 people overall. It leases a 4,000-square-foot office at 605 E. Holland, on Spokane's North Side, he says.

Magnuson asserts that U.S. hotel room occupancy nationally fell 22 percent in November 2008 from the year-earlier period. In addition, over the next six months the U.S. will experience a 17 percent increase in the number of available hotel rooms this year, following over-expansion in the hotel building market over the past several years, he says. He attributes the brisk growth in client hotels in part to that continued overabundance of hotel rooms in a struggling economy.

With that heightened competition, "We're seeing an even greater acceleration of owners seeking low-cost operations and support the tougher the year ahead gets," Magnuson says.

For all of its clients, Magnuson Hotels operates a Web-based reservation-booking system and negotiates group pricing on services such as listings on industry travel-listing systems originated by airlines. The systems, called global distribution systems, are used by more than 650,000 travel agents to book reservations. Recently, the company has registered its chain code, which enables global travel agents to identify Magnuson properties as preferred, Magnuson says.

Magnuson Hotels also arranges discounted credit-card processing fees for its members and has negotiated group pricing on such things as supplies that its members might need.

The son of North Idaho businessman H.F. "Harry" Magnuson, who passed away last Saturday, Tom Magnuson grew up in the hotel industry, starting with the Stardust Motel that his father built in Wallace, Idaho, in 1964, and operated hotels himself in Wallace. He founded Magnuson hotels with his wife, Melissa, who previously operated an advertising agency in North Idaho.

Magnuson says he expects the company to continue growing.

"We don't stand still," he says. "It's incumbent that in order to provide greater value, we have to keep coming up with more ways to increase revenue and decrease costs constantly."