Hotel & Motel Management - October 6, 2008 - (Page 28)

28 Special Report OWNERS AND DEVELOPERS H&MM October 6, 2008 | HotelMotel.com www.HotelMotel.com/digital_edition Hotel owners focus on portfolios in downturn By Jason Q. Freed SENIOR EDITOR he impact of the current economic downturn is hitting property owners hard. As occupancy levels dip, revenue stops rolling in but loan payments don’t go away. What makes it even tougher T is that no one predicted the down cycle would hit so abruptly. And now it may take a while to shake out. “No one was expecting the mortgage crunch to happen,” said C.A. Anderson, EVP of development and acquisitions for Interstate Hotels & Resorts, a hotel real estate investor and operator of full- and select-service hotels. “Nobody wants to be a naysayer, but in our minds, [rebounding] is going to take a while. There’s more of the housing crisis that’s going to have to shake out ﬁrst. Q1 2009 will be the telltale sign. We hope to be back to normalcy by the end of 2009,” he said. Interstate has ownership interests in 56 hotels and resorts, including seven wholly owned assets. Together, it manages 217 hotels with just over 45,000 rooms. Three years ago, Interstate ranked fourth on Hotel & IHG InterContinental Hotels Group topped this year’s list of HMM’s “Top Multiunit Owners and Developers.” Motel Management’s “Top Hotel Multiunit Owners and Developers” list, ranked by number of guestrooms open. In 2007, it fell to seventh and this year it comes in at 12th. Interstate is one of the few independent companies at the top of the list, ranking just behind big brands such as InterContinental Hotels Group, Mar- Anderson riott Interna- INTERSTATE tional, Hilton Hotels Corp. and Accor North America. Although Interstate reported 10 additional properties in its portfolio between 2007 and 2008, its number of guestrooms open fell by nearly 2,000. Like many companies that responded to the survey, Interstate did not report its number of guestrooms or properties in development. Out of the 153 companies that provided information, 64 did not include ﬁgures representing their current development pipeline. “I don’t think you’re going to see a signiﬁcant number of asset transactions between now and the next six months,” Anderson said. “We’re focusing on primarily joint venture assets, but debt for all types is hard to come by. Underwriting criteria for lenders is much tighter. Demand is much tighter.” There are multiple challenges to getting a deal done in today’s market. First and foremost, there See Owners | page 30 CIRCLE NO. 155 http://www.HotelMotel.com http://www.HotelMotel.com/digital_edition http://www.drivetuscany.com http://www.drivetuscany.com

Table of Contents Feed for the Digital Edition of Hotel & Motel Management - October 6, 2008

Hotel & Motel Management - October 6, 2008 Contents NYLO Brands Mix Up Lifestyle Segment La Quinta Eyes Mexico, Canada for Growth Perspective Legally Speaking Marketing Matters Satisfaction Trends Maintenance Doctor HotelWorld Update Trends & Stats Independent Hotels Top Hotel Multiunit Owners and Developers Survey Cleaning & Maintenance Music Wallcoverings Supplier News Transactions Softgoods: Bedding & Linens People Events Ad/Editorial Index Marketplace Classifieds Checking Out

Hotel & Motel Management - October 6, 2008

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