Panelists at the Hunter Hotel Conference addressed Airbnb's impact and Anbang’s bid for Starwood Hotels & Resorts Worldwide.
ATLANTA—Talk of Anbang’s disruption in the Marriott/Starwood deal and a lack of fear of Airbnb were topics of conversation among panelists during the first two days of the 28th annual Hunter Hotel Investment Conference in Atlanta.
The Day One general session began after Anika Khan, senior economist at Wells Fargo Securities, gave her outlook for the hotel industry, predicting that 2016 will be another recession-free year. The current and future impact of Airbnb was discussed during the first 15 minutes of the “State of the industry” panel.
Airbnb is a nonfactor in suburbia
Tyler Morse, CEO and managing partner of MCR Development, said Airbnb isn’t a threat in U.S. suburban markets.
“Airbnb is not a factor in suburban New Jersey. In the suburbs outside of Denver, it just doesn’t matter,” Morse said. “There are a handful of units, but you
end up staying (on) some guy’s air mattress and living with their cat. You know, that’s a totally different (experience).”
Morse also said he believes Airbnb will eventually have to follow guidelines and become another distribution channel like the online travel agencies.
“You’re seeing what’s going on in New York City right now. New York City has a $12-million annual budget to crack down on Airbnb housing,” he said. “They might not get them this year; they might not get them next year, but I think in the long-term they’re going to win and (Airbnb) is going to have to put in fire code, life safety. They’re going to have to pay tax, and it’s just not going to be the wild, Wild West that it is right now.”
During the “Presidents panel,” Aimbridge Hospitality President and CEO Dave Johnson referenced a presentation from a meeting he attended the week before Hunter Conference that showed that most Airbnb customer dissatisfaction ratings were a result of a lack of services and amenities. Johnson said hoteliers can never get away from the importance of taking care of the customer.
Anbang’s disruption in the Marriott/Starwood deal
Steve Joyce, president and CEO of Choice Hotels International, who participated in Hunter’s “Presidents panel,” said Anbang’s all-cash bid for Starwood Hotels & Resorts Worldwide would not be a good move for the hotel industry.
“At that price or even a little bit higher, they don’t make any money, and so therefore, they’re not going to invest in making Starwood a greater company,” Joyce said. “I think Marriott would invest and I think the combination of those two skillsets is powerful, so my view is always, I think the industry is healthier for all of us when we have strong competitors.”
“I think if you talk to anyone at either (Marriott or Starwood), it’s very hard to say what’s going to happen,” he said. “They’ll have what, 30 brands if they combine? (They’ll probably be) two or three brands deep in each segment?
“There’s going to be a lot of change as a result of that. I don’t know where it’s going to happen or how it’s going to happen. … What I’ve been telling people is that the things you think are going to be good will probably be bad and the things you think are going to be bad will probably be good.”
If Marriott does acquire Starwood, Morse said it will be positive for Marriott owners.
“As an owner of 50 Marriott hotels, If Marriott acquires Starwood, that’s just another 15 million people in the frequent guest program that we didn’t have before,” he said.