Hotel & Motel Management - March 17, 2008 - (Page 34) 34 Special Report H&MM March 17, 2008 | HotelMotel.com Pyramid will pad portfolio By Jeff Higley CONTRIBUTING EDITOR yramid Hotel Group is one company that’s not afraid of a potential downturn in the economy. Boston-based Pyramid, which offers property management, asset management and project management, is actively looking to pad its portfolio of 46 hotels comprising more than 18,000 guestrooms, according to John Hamilton, senior v.p., business development. It also has 19 golf courses and nine spas, in addition to more than 1.5 million square feet of meeting space at its properties. Speaking during a break dur- PYRAMID HOTEL GROUP P ing January’s Americas Lodging Investment Summit, Hamilton said Pyramid’s executives have worked together for more than 25 years—even though Pyramid wasn’t launched until 1999—and know what it takes to take care of an asset during turbulent times. “Because of our understanding of our assets, we’ve been in the manager’s shoes,” Hamilton said. The company has overseen more than $600 million in renovations during the past five years, Hamilton said. Pyramid has less than 5percent ownership stake in each of the properties and plans to continue investing sliver equity in its deals going forward. “It gives us the same incentives and challenges as the primary ownership group,” Hamilton said. “It helps us make better decisions.” Hamilton said he expects asset management opportunities to in- The Arizona Biltmore Resort & Spa in Phoenix sits on 39 acres covered with lush gardens, glistening swimming pools, and Frank Lloyd Wrightinfluenced architecture. crease during 2008. “Ownership is looking to gain share,” Hamilton said. “We grow faster in down economic times. We don’t think the future is going to be as grim as in other cycles. There will be opportunities to gain distressed assets, but there is more opportunity to help owners during difficult times.” Hamilton cited the Boston Harbor Hotel as a prime example of what Pyramid brings to the table: When Pyramid assumed management of the property in 2006, the hotel had a three-star rating. Now, it’s a five-star hotel. The company is looking for acquisition opportunities with fullservice three- and four-star hotels that fly a major flag. In the management realm, it is seeking more opportunities in the luxury segment. “We’ve built a significant organization,” Hamilton said. “Quality is what is going to persevere through any flattening or downturn of the economy.” Pyramid won’t rush into any deal, according to Hamilton. “We will continue to look for opportunities,” he said. “If those opportunities are many, we’ll grow faster; if not, then it will be slow- er growth.” Regardless of the pace of growth, Pyramid’s attraction to top-of-the-line resorts is genuine, especially since the company assumed the asset management role for several former CNL Hospitality properties about two years ago. “The luxury properties we have are truly irreplaceable,” Hamilton said. He said properties such as the Arizona Biltmore Resort & Spa in Phoenix, the Grand Wailea Resort Hotel & Spa in Maui, Hawaii, and the La Quinta Resort & Club in Palm Springs, Calif.—all of which Pyramid asset manages—provide the company with a target. “The luxury market is susceptible to risk,” Hamilton said. “Companies in pursuit of the luxury experience sometimes do it at the cost of the basics. The basic thing is the experience. You have to make that perfect, then you can layer on other things.” Hamilton said the biggest issue companies like Pyramid face is balancing the cost of the physical plant. “It’s about not overspending in areas that don’t affect the guest experience,” he said. hmm@questex.com PYRAMID HOTEL GROUP The Hilton Daytona Beach (Fla.) Ocean Walk Village, located directly on the beach, provides many recreational and dining options. CIRCLE NO. 132 http://HotelMotel.com http://www.ihrco.com http://www.ihrco.com
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