HNN@ALIS: Day Two recap
28 JANUARY 2015 9:31 AM
Another day in the books, another day of deal making at the Americas Lodging Investment Summit. The din of such discussions often was overwhelming as it emanated from the lobby of conference host hotel JW Marriott Los Angeles LA Live. And while not all announcements proved as sizeable as Marriott International’s $135-million grab of Delta Hotels and Resorts, they were fruitful nonetheless.
Company news and announcements
- AH&LA unveils 2015 policy agenda
- ALIS announces award winners
- Best Western notches record breaking year
Photo of the day
|Bill DeForrest of Spire Hospitality, Ravi Patel of Hawkeye Hotels and Matt Wehling of Hilton Worldwide Holdings shared some conversation outside the JW Marriott in Los Angeles’ LA Live complex on Tuesday night. (Photo: Jeff Higley)|
5 things to know from ALIS
1. Marriott International doesn’t plan to move the headquarters of Delta Hotels & Resorts from Toronto once the proposed deal for the brand closes during the second quarter. Marriott executives speaking during a Tuesday news conference said the proposed deal will help the company enter markets that it otherwise couldn’t have.
“It’s a turn-key business that we’ve purchased,” said Brian King, global officer, Marriott signature brands & global sales.
Marriott announced the proposed acquisition of the 38-hotel chain on Monday, and during Tuesday’s news conference, the executives indicated more deals could be in the offing.
2. Optimism reigns, but that doesn’t mean investors aren’t preparing for the worst. In panel after panel, speakers spoke of the due diligence they’re putting in now to mitigate the impact of the next black swan or inevitable downturn. “Nobody wants to be caught again with their pants down,” was a phrase uttered on more than one occasion.
And just what might derail the up cycle? Answers ranged from record drops in oil prices, shifts in currencies and the overabundance of capital. On that latter, Pebblebrook Hotel Trust’s Jon Bortz summed up his fears best when he said, “There’s way too much capital in the world. We’ve seen this movie before. It’s not going to end well. We just don’t know when the bus is going to go over the cliff.”
3. For the first time in a while, the word “millennial” hasn’t been front and center, even with all the new brand launches announced this week. Brands have finally realized that hotel habits aren’t just about guest age.
4. Consolidation within the management company space is likely to continue.
“There’s already some consolidation taking place. There likely will be more. Anyone who thinks there’s not going to be some roll-up is naïve,” said Michael George, president and CEO of Crescent Hotels & Resorts during a panel discussion.
But it’s not for everybody, he said. Those looking for real returns are better off turning their sites to brick and mortar real estate as opposed to the margin games inherent in management contracts.
5. Growth continues to be the name of the game in the hotel industry, and that was evident during Tuesday’s discussions at ALIS. Companies ranging from Hotel Equities to Best Western to CHMWarnick laid out plans to increase the size of their portfolios.
“If you want to get the level of service and quality of service and depth of knowledge and intellect you need in these complicated assets, you have to have scale,” said Ken Wilson, CEO of CHMWarnick, an asset-management company created with the merger of Capital Hotel Management and Warnick & Company.
Quotes of the day
“You can’t seem to swing a dead cat at this conference without hitting someone announcing a new lifestyle or boutique concept.”
—Mike Depatie, former CEO of Kimpton Hotels & Restaurants, referring to news of Hyatt Hotels Corporation’s announcing its Centric full-service lifestyle brand, during a “View from the boardroom” panel
“In the last five years, the development community has migrated to lifestyle and boutique hotels because they allow them to create something unique and individual, and allows for flexibility. The lending community also has been absolutely more receptive to our segment too, which wasn’t the case five years ago.”
—Niki Leondakis, CEO of Commune Hotels & Resorts
“When it comes time to go upstairs and sleep, even a rock star needs his rest.”
—Marco Roca, Hard Rock Hotels’ executive VP and chief development officer for hotels & casinos, while discussing the brand’s expansion plans during an interview with HNN
Tweet of the day
Tweet of the day
“The great irony: the customer doesn’t want to be owned, but everybody wants to own the customer” #ALISConference— guy langford (@guy_langford) January 27, 2015