Hotel & Motel Management - July 21, 2008 - (Page 37)

www.HotelMotel.com/digital_edition HotelMotel.com | H&MM July 21, 2007 News 37 Brands Continued from page 35 nancing. … I think now there’s more of a tendency to check every box. It’s going to slow things down. It’s the reality of where we are in the cycle. I think we’ve all moved away from the challenge being ‘cost, cost, cost.’ It’s all about ensuring we get proper ﬁnancing. … We’ve seen a deﬁnite shift in the projects we’re moving to now: There’s more quality—high-quality developers, more urban markets, more complex deals. There’s a safety net in brands. The lender has to understand what the brand proposition is. Anhut: The entitlement process is cumbersome for anybody, regardless of brand. On the ﬁnancing side, there’s no doubt people are asking more questions, as they should, about new brands— they’re not blindly following the developer into a project. If you take the average length of time for a new brand in our business at an upscale price point or higher to get to 100 units of distribution, the average is 10 years. And most of those brands went through up and down cycles along the way. In our case with Indigo, we’ve got an opportunity to upbrand in a lot of markets where somebody may be looking to take an unﬂagged or unrenovated hotel. Sacco: It’s about who you’re doing deals with. With aloft and Element, we’ve done our ﬁrst deals with the best developers in the industry who are well capitalized. Debt is a little slower, but they have the equity in place. They’re experienced. They’ve been able to build through the economic downturn. Also, on critical mass: Tying aloft and Element to W and Westin has just been incredibly powerful in getting lenders. How important is critical mass for a new brand launch? Edmundson: Critical mass has than in the luxury segment. Anhut: I think critical mass is not so critical to the consumer, but it is incredibly critical to the lending community. … In the franchising world we’re asking our people to sign 10-, 15-, 20-year licenses. Critical mass is a squishy theory, but it’s one we spend a lot of energy on, convincing people we’re going to get there. Share some stories about how your brands changed from initial vision to execution. Sacco: Our vision has re- mained pretty much the same with the new brands. We believe in the consultants doing the feasibility studies for our projects. We’ll likely create a new niche, a white space somewhere, in terms of creating customer appeal. Anhut: We started out thinking, “How do a bunch of 50-yearold guys create a brand for Gen X?” We learned it’s not a demographic, it’s a psychographic. It’s about having a shared mindset rather than a shared age bracket. We brought [Hyatt Place] closer into the center. Edmundson: We did our homework. We decided what segment we were going to participate in, we did studies, and we knew that if we picked our segment and our guests, we could design it. These guests take their lifestyle with them when they travel. The key thing has been keeping in mind the psychographics. This made us be smart about the things we do—things like the ﬁtness room, the Wolfgang Puck barista bar. The challenge now is keeping up. Keeping up with technology in particular. Anhut: We had some “aha” moments. We realized boutiques are unique and different from location to location. It’s allowed us to go a lot closer to the upperupscale price point. It’s played out pretty well for us. sricca@questex.com Washington DC - October 8 Dallas - November 5 Hotel Investor s Marketplace Designed For I Hotel owners and investors I Hotel management executives I Hospitality acquisition specialists I Equity and investment fund managers Program I Marketplace begins at 12pm and ends by 5pm I Includes buffet lunch, property book, due diligence materials and speaker presentations I Executive summary and complete information on all exclusively listed hotel properties Benefits I Gain valuable insight into local, regional and national hotel investments I Meet one-on-one with the hospitality industry’s most experienced hotel brokers I Review HBI’s inventory of exclusive hotel listings I Visit with key representatives of the industry’s most prominent franchise companies I Network with top industry leaders and decision makers I Obtain latest information in hospitality lending Marketplace Sponsors I La Quinta Inns, Inc. - Premier Level I Carlson Hotels Worldwide I Choice Hotels International I CIT Small Business Lending I Mercantile Commercial Capital, LLC I PMC Commercial Trust Provided in support by Hotel & Motel Management To request an invitation call 816.505.4315, e-mail your request to info@hbihotels.com or contact your local Hotel Brokers International broker. some variables. If you are in smaller or suburban markets, it takes a little longer. It’s not really a magical number. At Cambria, it’s important for us to get some urban projects in the mix. Abrahamson: It’s a difﬁcult thing to deﬁne. In the U.S., it’s all about critical mass. You have to have distribution to be successful. I think in this upscale select-service segment, it’s more about mass www hbihotels com CIRCLE NO. 110 http://HotelMotel.com http://www.HotelMotel.com/digital_edition http://www.hbihotels.com http://www.hbihotels.com

Table of Contents Feed for the Digital Edition of Hotel & Motel Management - July 21, 2008

Contents Larkspur Hotels Branch Out with New Brand Starwood’s C.E.O. Maps Out Journey New Brand Leaders Share Hits, Misses Perspective Letters to the Editor Legal FAQ Training Trends Sales Clinic HotelWorld Update Trends & Stats Special Report: 2008 Construction Companies Survey Guest Column Events Technology: Telephones Hotel Operations: Building Exterior Design: Televisions Transactions Awards Hot Products: Mattresses Supplier News Ad/Edit Index Marketplace Classifieds Checking Out Hotel & Motel Management - July 21, 2008

Hotel & Motel Management - July 21, 2008

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