You’ve heard people talk about wanting to be the “fly on the wall” listening in on important conversations? On Thursday evening (11 February) inside a private room at Paulette’s Restaurant in Memphis, Tennessee, I was that proverbial fly-on-the-wall.
The occasion was Pinkowski & Company’s 8th Annual Presidents’ Dinner, co-sponsored by The Allied Group and U.S. Foodservice. The dinner was attended by about a dozen top-level southern hotel executives who were all talking shop for three hours. The dinner served as the precursor to the 12th Annual Memphis Lodging Industry Update.
And there I was, sitting at the dinner table with a front row seat. As a journalist, it doesn’t get a whole lot better than this. The opinions of these executives is especially important because they aren’t Wall Street types looking for an edge—they're real people who have a great feel for what's happening on the front lines.
The topics discussed were many and varied. Here’s a sampling of what was on the minds of these industry leaders.
Chuck Pinkowski, founder of consulting firm Pinkowski & Company, asked Greg Averbuch, president of Summit Management Corporation about rate integrity.
“Non-existent,” Averbuch said.
Pinkowski said there will have to be positive employment numbers before room rates rebound. He said he doesn’t see a rebound in rates until 2011. Pinkowski did note, however, that demand for the October-through-December period of 2009 was up compared to 2008.
Not that 2008 was exactly a stellar year to begin with, said Bob Hunter of Hunter Realty.
“Compared to cruddy,” he said, “we’re doing a little better.”
There was nearly unanimous agreement at the table that sustainability is here to stay—with the one apparent holdout being Wayne Tabor, GM of the Holiday Inn Select Downtown Memphis.
“It’s a green show,” he said. “It’s not a green movement. It’s a green show.”
Still, William J. Crosby, director of business development for construction services company Allied Group, said he sees sustainability being worked into building codes in the future.
“It costs money,” Tabor said of going green. “If you’re going to build a green hotel, you need a rate to construct that green hotel.”
A lot to talk about
Of course, numerous other topics were bantered, including what opportunities were in front of real estate investment trusts (they will face stiff competition when it comes to utilizing their war chests, the panelists said); lending (banks have tightened underwriting standards and are very cautious when it comes to selling properties); and the effect of factoring in a property improvement plan when it comes to pricing a deal (“It absolutely clobbers you,” said Larry Wright, Sr., of Wright Investments). I’ll be reporting on those topics in upcoming articles.
I was asked several times throughout the night if I was getting enough information for my article.
I’d say the throbbing pain in my note-taking hand answered that question as well as I could.