LOS ANGELES—Donald Trump shared his recipe for success in the hotel business during a keynote address Tuesday at the Americas Lodging Investment Summit.
“I love this business,” he told a crowd of 2,400 inside the Nokia Theatre at L.A. LIVE.
Trump spent time during his 30-minute address discussing what has brought the most success to his Trump Organization. First on his tip sheet: the importance of brands.
He used his own company as an example, relaying examples of how the Trump name brought success to his various developments, ultimately helping the company obtain zoning approval in difficult markets, such as Aberdeen, Scotland.
Trump said he only will lend his name to projects he feels are of the highest quality. “They know we’re going to get it done,” he said. “They know we’re going to get it done (with) quality.”
Trump said he believes ratings (such as 5-star, and 5-diamond-rated properties) “brings people” to properties.
A focus on architectural design is just as important. “I really insist on premium architecture,” he said, adding later, “I think the thing I do best in life is construction.”
During the session, Trump said he “enjoys buying sick puppies” and nursing the properties back to health.
“… We’re dealing in psychology when it comes to hotels,” he said, noting psychology plays a big large in the real-estate business. He said he noticed with his hotel in New York customers are willing to pay more for a park view, though the city view offers a better vista. As a result, he gets a higher rate for park views, which are inferior views in his opinion.
Development plans
During a news conference following his speech, Trump said his company has 10 hotel projects in the development pipeline. There are seven hotels under the Trump umbrella, with the 261-room Trump Toronto scheduled to open 31 January.
Trump said there are “numerous” locations in London that have caught his eye. He also listed the Asia/Pacific region, as well as India and China as being hotel development hotspots. Primary major cities also are on his must-have list.
Lending shortage
Part of the reason hotel industry development is challenged is because banks are not lending, he said. Money for new construction is not there, he said.
“Banks have let the hotel industry down in case you haven’t noticed,” Trump told the ALIS attendees. “You’re nothing compared to what they did to the residential people.”
He said banks only will lend money to people who have money; money for new development is nonexistent, he later told reporters.
“They’re not giving you money,” he said during his keynote address. “The only way they will give you money is if you have in the bank many, many, many, many times more.”
Obama criticisms
Trump, who expressed interest in running for president in the 2012 election, spent a considerable amount of time criticizing President Obama.
Regarding President Obama’s recent focus on U.S. tourism and visa reform, Trump said: “I don’t know if anyone knows what his strategy is. I think the strategy initially was don’t go to Las Vegas.”
He said the U.S. has “tremendous potential” but is being held back by a “bad president and bad decision makers.”
“Right now we have a debtor nation, and it is really, really a tough situation,” he said.
Trump tips
Trump offered several other sound bites to the gathered throng of ALIS delegates and during his follow-up news conference.
• “If you want to build a hotel in Chicago, you better think about it because it’s a very tough market.”
• If someone tells you renovation is more expensive than new construction, they don’t know what they’re talking about.
• On China: “They are ripping us like no one has been ripped before.”
• On India: “We’ll be there.”
• What advice would he give to his children? Enjoy what you do.
• Further recovery of the hotel sector is dependent on what happens with the larger economy.
• Europe is in a recession. “The eurozone is a complete disaster.”
