Hotel & Motel Management - February 4, 2008 - (Page 6)

Checking In PERSPECTIVE H&MM February 4, 2008 | HotelMotel.com EDITORIAL Is the luster of the hotel industry wearing off? IN THE details Lodging stocks take a hit Prices keep falling Real-estate causes woes Cycle should reverse By Jeff Higley Editorial Director as the fairy-tale clock struck midnight? Is the glass slipper now too small? Has the belle of the ball turned into the ugly chick in the corner? We have been seeing a shift in the way investors are looking at the hotel sector, and it appears to be a wary sideways glance that generally means “keep your distance.” First, the subprime credit crisis caused a blip on the radar last August when it caused a reassessment of loans ﬂowing into the hotel industry. Most experts agreed that it would have a minimal impact on the longterm viability of the sector— and that some good would come out of it because it would slow the pipeline. Fast forward a few H months—ﬁve or six months after July’s announcement that The Blackstone Group was going to pay $27 billion to acquire Hilton Hotels Corp. and take it private—and stock-market investors began wafﬂing on whether the sector still was favorable. The wafﬂing became a full-ﬂedged sell-off in January. As of this writing, several major public hotel companies had been hard hit by falling stock prices, including: Marriott International’s stock price was at $32.35 per share at close on Jan. 17, down from about $45 per share on Oct. 1. Starwood Hotels & Resorts Worldwide’s stock price was $38.22 on Jan. 17, down from about $61 per share on Oct. 1. Choice Hotels International’s stock price was $30.05 on Jan. 17, down from about $41 in early October. There’s a trend that’s not good. But as we all know, the lodging industry is cyclical no matter how you slice it. Room rates should hold fairly steady this year with a slightly lower occupancy. That’s good news. The bad news is that hotel stocks are again being lumped in with other real-estate stocks. While there certainly is a realestate component to every hotel on Earth, the reality is that it is an operating business. And even during what could be a recession later this year, the hotel industry will continue to make money for owners and operators. A great cause I haven’t always seen eye to eye with Steve Belmonte. The sometimes-boisterous president of the Lexington Collection and I have one thing in common that at times creates interesting conversations: We have opinions about everything. Steve was in the hotel industry long before I knew what a duvet was. He started as a teenager and hasn’t looked back— spending 40-plus years in the business. We’ve disagreed, argued, disagreed some more and mended fences. Once I even apologized because, gulp, I was wrong about something. But one thing I have never forgotten about Steve is that he and I share a love of kids. Yeah, kids get on all of our nerves at one time or another (or another or another…), but at the end of the day I don’t know many people who don’t have a soft spot for children—especially if the kids need help. Belmonte is continuing a legacy he started while leading the Ramada brand by partnering with Plan USA, formerly called Child Reach, in an effort to get help for some of the neediest kids in the world. Plan USA will use Belmonte as a spokesman on infomercials and public-service announcements. The television schedule has the potential to reach 100 million consumers nationwide, and it would cost Lexington $2 million or more to buy airtime. The Lexington-Plan USA partnership also will be incorporated at the property level with hotels actively engaging in the Lexington Dollar A Day program. In turn, 100 percent of that donation will be given to Plan USA to help build schools and hospitals in some of the poorest countries of the world. Yes, there are advantages for Lexington to have Belmonte involved. “It shows our company to the public in a very wonderful, warm and caring manner,” Belmonte said. “Without charities like this, these kids will die. There is no government safety net for them in these third-world countries.” One of the best things about the lodging industry is that it is ﬁlled with caring people. Steve Belmonte is one of them. jhigley@questex.com 600 Superior Ave. East, Suite 1100, Cleveland, OH 44114 Jeff Higley, EDITORIAL DIRECTOR . . . . . . . . . jhigley@questex.com Ph: (216) 706-3728 | Fax: (216) 706-3711 Stephanie Ricca, MANAGING EDITOR . . . . . . . sricca@questex.com Ph: (216) 706-3791 | Fax: (216) 706-3711 Elaine Simon, SENIOR EDITOR . . . . . . . . . . . . esimon@questex.com Ph: (216) 706-3782 | Fax: (216) 706-3711 Stacey Mieyal Higgins, SENIOR EDITOR . . . . . .shiggins@questex.com Ph: (216) 706-3783 | Fax: (216) 706-3711 Heather Gunter, ASSOCIATE EDITOR . . . . . . . hgunter@questex.com Ph: (216) 706-3792 | Fax: (216) 706-3711 Jason Q. Freed, ASSOCIATE EDITOR . . . . . . . . jfreed@questex.com Ph: (216) 706-3727 | Fax: (216) 706-3711 Emily Hanna, ASSOCIATE EDITOR . . . . . . . . . ehanna@questex.com Ph: (216) 706-3784 | Fax: (216) 706-3711 Patricia Sheehan, MANAGING EDITOR, Hotel Design Ph: (216) 706-3753. . . . . . . . . . . . . . . . . .psheehan@questex.com Amy B. Witek, ART DIRECTOR . . . . . . . . . . . . . awitek@questex.com Rob Ghosh, ART DIRECTOR. . . . . . . . . . . . . . .rghosh@questex.com ADVERTISING/SALES/CIRCULATION 600 Superior Ave. East, Suite 1100, Cleveland, OH 44114 John McMahon, GROUP PUBLISHER . . . . . jmcmahon@questex.com 757 Third Ave., 5th Floor, New York, NY 10017 Ph: (212) 895-8243 | Fax: (212) 895-8212 Matt Waddell, PUBLISHER . . . . . . . . . . . . . . mwaddell@questex.com 2835 N. Shefﬁeld Ave, Suite 236, Chicago, IL 60657 Ph: (773) 880-2240 | Fax: (773) 880-2241 Mary Malloy, NORTHEAST, INT’L. . . . . . . . . .mmalloy@questex.com Ph: (216) 706-3790 | Fax: (216) 706-3711 Brian Levine, SOUTHEAST . . . . . . . . . . . . . . . blevine@questex.com 757 Third Ave., 5th Floor, New York, NY 10017 Ph: (212) 895-8285 | Fax: (212) 895-8215 Jason Wallace, WEST . . . . . . . . . . . . . . . . . . . jwallace@questex.com 1461 S. 375 E., Kaysville, UT 84037 Ph: (801) 499-9999 | Fax: (801) 315-4137 Brian Olesinski, CLASSIFIEDS, RECRUITMENT, DIRECTORY . . . . . . . . . . . . . . . . . . . . . . . .bolesinski@questex.com Ph: (216) 706-3794 | Fax: (216) 706-3711 Heidi Spangler, DIR., AUDIENCE DEV. . . . . . . . hspangler@questex.com Ph: (216) 706-3705 | Fax: (216) 706-3714 BUSINESS DEVELOPMENT Stacy Silver, BUSINESS DEV. DIRECTOR. . . . . ssilver@questex.com Ph: (954) 306-0747 | Fax: (954) 697-6265 J. Richard Casson, ASSOCIATE BUSINESS DEV. DIRECTOR . . . . . . . . . . . . . . . . . . . . . . rcasson@questex.com Ph: (212) 895-8426 | Fax: (212) 895-8210 PRODUCTION 306 W. Michigan St., Suite 200, Duluth, MN 55802 Jamie Kleist, ASST. PRODUCTION DIR. . . . . . . jkleist@questex.com Ph: (218) 279-8855 | Fax: (218) 279-8812 Janelle Heller, PRODUCTION MANAGER . . . . . jheller@questex.com Ph: (218) 279-8834 | Fax: (218) 279-8815 MARKETING/MAGAZINE SERVICES MARKETING/MAGAZINE SERVICES Ilene Schwartz, Kroll Direct, LISTS . . . . . . . . .ilene@krolldirect.com Ph: (216) 371-1667 | Fax: (216) 371-1669 PERMISSIONS . . . . . . . . . . . . .questexpermissions@reprintbuyer.com Ph: (800) 494-9051 Ext. 100 REPRINTS . . . . . . . . . . .HotelandMotelManagement@reprintbuyer.com Ph: (800) 290-5460 Ext. 100 SUBSCRIPTIONS, CUSTOMER SERVICE. . Questex@sunbeltfs.com Ph: (866) 344-1315 | Fax: (615) 377-0525 BACK ISSUES, SINGLE CURRENT COPIES, CD-ROM, MICROFILM, MICROFICHE Ph: (866) 344-1315 | Fax: (615) 377-0525 Corrections Some incorrect information was printed in The Advisor’s Owners Survey (Dec. 27, 2007): Cooper Companies owned 22 properties in 2006 with 3,948 guestrooms, and 23 properties in 2007 with 4,259 guestrooms. Larkspur Hotels and Restaurants owned 19 properties in 2006 with 2,247 guestrooms, and 11 properties in 2007 with 1,351 guestrooms. Milestone Hospitality Management owned 14 properties in 2006 with 2,367 guestrooms, and 15 properties in 2007 with 2,542 guestrooms. Regency Hotel Management owned 21 properties in 2006 with 3,720 guestrooms, and 20 properties in 2007 with 3,586 guestrooms. The Summit Group owned 61 properties in 2006 with 5,486 guestrooms, and 66 properties in 2007 with 6,191 guestrooms. Also, the following brands were inadvertently omitted from The Advisor’s Brand Survey (Dec. 27, 2007): Motel 6 had 847 properties with 87,287 guestrooms in 2006 and 883 properties with 91,676 guestrooms in 2007. Motel 6 franchises and their fees are as follows: Application—$25,000; Royalty—4 percent; Marketing—3.5 percent. Studio 6 Extended Stay had 42 properties with 5,152 guestrooms in 2006 and 45 properties with 5,450 guestrooms in 2007. Studio 6 franchises and their fees are as follows: Application—$25,000; Royalty—5 percent; Marketing—2 percent. We welcome your comments, criticisms and compliments. Address correspondence to: Letters Editor, Hotel & Motel Management, 600 Superior Ave. East, Suite 1100, Cleveland, Ohio 44114; e-mail to hmm@questex.com; or fax to (216) 706-3711. We reserve the right to edit for length and clarity. Please keep letters to 300 words or fewer. PRESIDENT & CEO—Kerry C. Gumas EXECUTIVE V.P. & CFO—Tom Caridi EXECUTIVE V.P.—Robert S. Ingraham EXECUTIVE V.P.—Tony D’Avino EXECUTIVE V.P., CORP. DEV.—Claudia Flowers V.P. & G.M.—Don Rosenberg V.P., DIGITAL MEDIA—Seth Nichols V.P., HUMAN RESOURCES—Diane M. Evans Copyright 2008 Questex Media Group, Inc. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical including photocopy, recording or information storage and retrieval system, without permission in writing from the publisher. Authorization to photocopy items for internal or personal use, or the internal or personal use of speciﬁc clients, is granted by Questex Media Group, Inc. for libraries and other users registered with the Copyright Clearance Center, 222 Rosewood Dr., Danvers, MA 01923; phone http://www.HotelMotel.com http://www.nxtbook.com/nxtbooks/questex/hmm122707/index.php?startpage=0 http://www.nxtbook.com/nxtbooks/questex/hmm122707/index.php?startpage=0

Table of Contents Feed for the Digital Edition of Hotel & Motel Management - February 4, 2008

Hotel & Motel Management - February 4, 2008 Contents Murray, Keltner to Keynote Atlanta Event ABVI Approves Per-room Fee Hike Growth, Guest Loyalty on Lexington’s Plate Perspective Legally Speaking AAHOA Update Marketing Matters Consultant’s Corner On Finance Training Trends HotelWorld Update Trends & Stats Outdoor Furniture Limited-service-hotel-chain Report Energy-management System Provides Link to Savings Upgraded Bedding Program Cost Comes Due Less Hot Water Equals Less-costly Bills Events Learn to Take Advantage of Lower Insurance Costs Brokers Will Remain Unscathed in 2008 Transactions Ad/Edit Index Marketplace Classifieds Checking Out

Hotel & Motel Management - February 4, 2008

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