|The 632-room Renaissance Hollywood Hotel & Spa in California marks Loews' first acquisition since Paul Whetsell took the reins as president and CEO six months ago.
NEW YORK—Paul Whetsell’s tasks were clear when he joined Loews Hotels & Resorts in January: Grow the brand. Nearly six months into his tenure as president and CEO of Loews, Whetsell shared with HotelNewsNow.com his plan to double the size of the brand by the end of 2015.
Speaking during a break at this week’s 34th annual NYU International Hospitality Industry Investment Conference, Whetsell said the company’s recent acquisition of the 632-room Renaissance Hollywood Hotel & Spa in California from the CIM Group is the beginning of the expansion plans. The hotel, which also has 48,000 square feet of meeting space, will undergo a $26-million renovation beginning later this year.
“I came in with a couple of objectives; one was to broaden the customer base of Loews,” Whetsell said. “You do that in two ways—you do it organically by enhancing your own sales-and-marketing programs, and then you add distribution. ... My intent is to double the size of this company over the next three and a half years.”
Including the Hollywood hotel, Loews has 18 hotels comprising 8,200 rooms in its portfolio. Whetsell said it will fully own, partially own and operate hotels under management contracts as part of it growth plans.
The Hollywood property is a “bread-and-butter” type of hotel that fits the Loews profile well because it is located in a 24/7 environment and caters to groups—but has a clear leisure component to its business mix, he said.
Whetsell declined to reveal what Loews paid for the hotel, but said parent company Loews Corporation acquired it with cash and the plan is to refinance it once the renovation is complete. The Los Angeles Times reported the deal was for $165 million.
“It was a sizable deal, but the ability to take a deal down like that and bringing in capital partner after it’s stabilized is something we can do,” he said. “Loews Corp. is a financially sound company that wants to grow its subsidiaries.”
Whetsell said the Hollywood property was being marketing before he joined Loews, but talks between the companies quickly escalated once he assumed his new role.
The parent company will participate in similar transactions as needed going forward—and the type of hotels Loews is targeting will vary according to market, according to Whetsell.
“I think I’m going to surprise people more by going after some other types of hotels—smaller hotels, smaller meeting space,” he said. “We need distribution fillers. We need different types of properties.
“Going forward we will take a more asset light type of approach, and we’ll bring in capital partners.”
Boston, Washington, Los Angeles and San Francisco were among the markets on Whetsell’s short list when he joined the company.
“Filling in LA first was a priority,” he said. “It’s a key market for us.”
Changes on the horizon
As the brand grows, it will add a points-based guest-recognition loyalty program, the CEO said.
“We have a recognition program now, but we haven’t been quite big enough to go to a points type of system,” Whetsell said. “Loews has some attractive properties for our customers, and we’re looking to enhance our traveler program. But we need some more distribution before we go to points.”
The company is undergoing an extensive renovation program at its existing hotels. While declining to reveal an exact expenditure, Whetsell said Loews is “spending considerable dollars” upgrading its existing portfolio.
In addition, the company is significantly changing its sales-and-marketing approach, according to Whetsell.
“We have not been as progressive as some of our competition ...you’ll see significant changes there,” he said.
He also said innovative changes on the technology side are coming for Loews hotels; the company isn’t ready to announce anything at this time.
Whetsell has retooled his executive team to spearhead the new initiatives, including promoting Shawn Hauver to VP of operations to handle the eastern region, creating the senior VP of e-commerce and distribution position for Jimmy Suh and hiring long-time Marriott International executive Bruce Himelstein as chief marketing officer.
“We’re changing the approach a little bit,” Whetsell said. “When somebody comes in with an aggressive growth program, it changes things. It creates an excitement. We have the new people coming in, and combined with the experienced executives already here, they seem to be charged with a lot of energy to accomplish what we want to do.
“When you start talking about doubling size in three years, you get a mixture of excitement and skepticism,” he added. “Loews is primed to take advantage of what’s happening in the market today.”
Whetsell said he is excited to take Loews to the next level in terms of size, and it’s something he has done before as the lead executive at CapStar Hotel Company, MeriStar Hospitality and Interstate Hotels & Resorts.
“This is not breaking new territory for me,” he said. “It took me a couple months just to understand what our system existed of, but it’s a type of hotel company that I’ve run in the past.
“(Loews Hotels chairman) Jon Tisch is a great partner to have,” he added. “He has given me a lot of rope to do some things to turn the company upside down just a little bit.”