Hotel & Motel Management - March 3, 2008 - (Page 44) 44 News Continued from page 1 H&MM March 3, 2008 | HotelMotel.com Business as usual Anticipating growth Best Western International, one of the largest hotel chains in the world, predicted its growth in 2008 to be bigger than previous years. “The pipeline is great,” said Ric Leutwyler, senior v.p. for brand quality and member services at Best Western. “We are looking for a 35-percent increase in the number of new members that we bring in this year over the number we brought in past years. We already have 40 deals that have been signed this year and 78 percent of those deals are new-construction deals. “That’s actually up from what we’ve been seeing in the prior years,” he said. Choice Hotels is banking on its extended-stay properties to flourish through a recession, and since retooling the Suburban Extended Stay and Mainstay Suites brands, it plans on 2008-2009 as a major growth period. “Historically, extended stay has been recession resilient,” said Kevin Lewis, president of extended-stay brands for Choice. “When recessions come, people become uncertain about their future. They may not want to sign a one-year lease in an apartment, so From left, Steven R. Goldman, president and c.e.o. of Sunstone Hotel Investors, and Matt Hart, former president and c.o.o. of Hilton Hotels Corp., listen as Charles Henry, president of Hotel Capital Advisors, answers a question from the moderator during Breakfast with IREFAC at ALIS. they turn to an extended-stay hotel. We’ve seen historically that the product has done very well even in recession times.” Beyond brand development, many predicted available money—especially debt—to dry up in 2008, leaving buyers and sellers stagnant until the economy pitfalls and lending standards are corrected. But most investment companies at ALIS reported aggressive plans, even if it means spending more of their own equity and relying less on debt. HEI Hotels and Resorts, a private-equity investment firm in Norwalk, Conn., that develops, owns and operates properties, recently acquired land in Bellevue, Wash., where it will develop a 378room Marriott Bellevue, expected to open in 2010. With another big-name project slated to open in 2009, the W Hollywood, the company has $500,000 in projects in the development stages. “Right now we’ve got purchasing power of about $2 billion with a substantial line of credit to help us be very nimble in this marketplace,” said Russell Urban, senior v.p. of development for HEI. “That’s a very significant component of our structure. It’s something that we’ve always had, but now that the credit crunch is here, it’s a real competitive advantage. We’re able to move very quickly Gene Sperling, former national economic adviser during President Bill Clinton’s time in office, delivered a keynote address at ALIS. without worrying about what today’s debt market looks like.” Steve Mendell, executive v.p. of acquisitions and development for HEI, said about 85 percent of the capital HEI plans to invest will be in acquisitions of existing hotels and 15 percent in development deals. Concord Hospitality, a Raleigh, N.C.-based hotel management and development company with 49 hotels (44 Marriotts) in its portfolio, is preparing for major growth in the next three years. In September, Concord sold a portfolio of 19 hotels but retained contracts to provide third-party management services for those properties and plans to reinvest $500 million in capital. “Almost a month into [2008], we’re at budget,” said Mark Laport, president and c.e.o. of Concord. “We’re seeing only a little choppiness in some markets; some are more robust than we expected them to be. We feel we’re set up to do what we think is doable, and that’s grow our business by another better part of 5 percent in real revenue growth. “We don’t see [a recession]. From the people who generate demand, from South Florida to Toronto to Edmonton, [Alberta,] to Texas, so far it’s holding up very strongly,” he said. Preparing for the future But in an industry that everyone admits is cyclical, one question remains in the back of hoteliers’ minds: Will 2008 simply be a dip between two valleys, or will a national recession cause an avalanche of tumbling demand and rates? Owners and operators still have time to prepare to minimize a recession’s potential impact on the industry. “There’s enough likelihood of [a recession] that from every property all the way up … we have contingency plans that are prepared and we’re ready to flip the switch,” said Arne M. Sorenson, executive v.p. and c.f.o. of Marriott International. “Some of the first and easiest steps in those plans are already starting to roll out just in case, but it’s about operating as efficiently as we can during whatever weak spell we have,” he said. Gary Mendell, c.e.o. of HEI Hotels and Resorts, said HEI has a plan in place—a “backup budget”—in case a recession hits. “We’re not seeing any signs of recession yet in our hotels,” he said. “Demand is strong through January. I suspect a slowdown during the year,” Gary Mendell added, “but we’re counting on a slowdown. So, unless there’s anything more than that, we’re not going to pull the switch on our contingency plans.” jfreed@questex.com ALL PHOTOS AH&LA FelCor Lodging Trust Chairman of the Board Tom Corcoran co-moderated a panel at ALIS with Stephen Rushmore, president and founder of HVS International [far right]. Seated are members of the Industry Real Estate Financing Advisory Council, who made up the panel: [from left] Steven R. Goldman, president and c.e.o. of Sunstone Hotel Investors; Matt Hart, former president and c.o.o. of Hilton Hotels Corp.; Charles Henry, president of Hotel Capital Advisors; Jackson Hsieh, managing director and global head of real-estate for UBS Securities; Gary Mendell, c.e.o. of HEI Hotels and Resorts; Richard Leslie Solomons, finance director of InterContinental Hotels Group; and Arne Sorenson, executive v.p., chief financial officer and president of Continental European Lodging for Marriott International. http://HotelMotel.com
Table of Contents Feed for the Digital Edition of Hotel & Motel Management - March 3, 2008 Hotel & Motel Management - March 3, 2008 Contents Embassy Suites Refreshes Look, Service F&B Concept Set to Take Off Conference Promises Perspective Letter to the Editor Legally Speaking Guest Column HSMAI Consultant's Corner On Finance Travel Trends Energy Star Update Trends & Stats Transactions Property Management Systems Carpet: Mixed Media Planting Greener Greens Transportation Vacation-Ownership Update Ad/Editorial Index Marketplace Classifieds Checking Out Hotel & Motel Management - March 3, 2008 Hotel & Motel Management - March 3, 2008 - Hotel & Motel Management - March 3, 2008 (Page 1) Hotel & Motel Management - March 3, 2008 - Hotel & Motel Management - March 3, 2008 (Page 2) Hotel & Motel Management - March 3, 2008 - Contents (Page 3) Hotel & Motel Management - March 3, 2008 - Conference Promises (Page 4) Hotel & Motel Management - March 3, 2008 - Conference Promises (Page 5) Hotel & Motel Management - March 3, 2008 - Letter to the Editor (Page 6) Hotel & Motel Management - March 3, 2008 - Letter to the Editor (Page 7) Hotel & Motel Management - March 3, 2008 - Guest Column (Page 8) Hotel & Motel Management - March 3, 2008 - Guest Column (Page 9) Hotel & Motel Management - March 3, 2008 - HSMAI (Page 10) Hotel & Motel Management - March 3, 2008 - HSMAI (Page 11) Hotel & Motel Management - March 3, 2008 - Consultant's Corner (Page 12) Hotel & Motel Management - March 3, 2008 - Consultant's Corner (Page 13) Hotel & Motel Management - March 3, 2008 - On Finance (Page 14) Hotel & Motel Management - March 3, 2008 - On Finance (Page 15) Hotel & Motel Management - March 3, 2008 - Travel Trends (Page 16) Hotel & Motel Management - March 3, 2008 - Travel Trends (Page 17) Hotel & Motel Management - March 3, 2008 - Energy Star Update (Page 18) Hotel & Motel Management - March 3, 2008 - Energy Star Update (Page 19) Hotel & Motel Management - March 3, 2008 - Trends & Stats (Page 20) Hotel & Motel Management - March 3, 2008 - Trends & Stats (Page 21) Hotel & Motel Management - March 3, 2008 - Trends & Stats (Page 22) Hotel & Motel Management - March 3, 2008 - Trends & Stats (Page 23) Hotel & Motel Management - March 3, 2008 - Trends & Stats (Page 24) Hotel & Motel Management - March 3, 2008 - Transactions (Page 25) Hotel & Motel Management - March 3, 2008 - Transactions (Page 26) Hotel & Motel Management - March 3, 2008 - Transactions (Page 27) Hotel & Motel Management - March 3, 2008 - Property Management Systems (Page 28) Hotel & Motel Management - March 3, 2008 - Property Management Systems (Page 29) Hotel & Motel Management - March 3, 2008 - Property Management Systems (Page 30) Hotel & Motel Management - March 3, 2008 - Property Management Systems (Page 31) Hotel & Motel Management - March 3, 2008 - Carpet: Mixed Media (Page 32) Hotel & Motel Management - March 3, 2008 - Carpet: Mixed Media (Page 33) Hotel & Motel Management - March 3, 2008 - Planting Greener Greens (Page 34) Hotel & Motel Management - March 3, 2008 - Planting Greener Greens (Page 35) Hotel & Motel Management - March 3, 2008 - Transportation (Page 36) Hotel & Motel Management - March 3, 2008 - Transportation (Page 37) Hotel & Motel Management - March 3, 2008 - Vacation-Ownership Update (Page 38) Hotel & Motel Management - March 3, 2008 - Vacation-Ownership Update (Page 39) Hotel & Motel Management - March 3, 2008 - Vacation-Ownership Update (Page 40) Hotel & Motel Management - March 3, 2008 - Vacation-Ownership Update (Page 41) Hotel & Motel Management - March 3, 2008 - Vacation-Ownership Update (Page 42) Hotel & Motel Management - March 3, 2008 - Vacation-Ownership Update (Page 43) Hotel & Motel Management - March 3, 2008 - Vacation-Ownership Update (Page 44) Hotel & Motel Management - March 3, 2008 - Vacation-Ownership Update (Page 45) Hotel & Motel Management - March 3, 2008 - Ad/Editorial Index (Page 46) Hotel & Motel Management - March 3, 2008 - Ad/Editorial Index (Page 47) Hotel & Motel Management - March 3, 2008 - Marketplace (Page 48) Hotel & Motel Management - March 3, 2008 - Classifieds (Page 49) Hotel & Motel Management - March 3, 2008 - Classifieds (Page 50) Hotel & Motel Management - March 3, 2008 - Classifieds (Page 51) Hotel & Motel Management - March 3, 2008 - Classifieds (Page 52) Hotel & Motel Management - March 3, 2008 - Classifieds (Page 53) Hotel & Motel Management - March 3, 2008 - Checking Out (Page 54) Hotel & Motel Management - March 3, 2008 - Checking Out (Page 55) Hotel & Motel Management - March 3, 2008 - Checking Out (Page 56)
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