At a conference that focuses on Main Street instead of Wall Street, the general vibe during Day One was that there’s no need to panic over what appears to be a correction in the cycle.
ATLANTA—The mood during Day One of the 28th annual Hunter Hotel Investment Conference was optimistic, as both the general session panel speakers and
economist Anika Khan, director and senior economist for Wells Fargo Securities, said 2016 will not be a year of recession for the hotel industry.
Among conference attendees, more than 60% said in the pre-event survey that they plan to develop a new hotel this year, and 85% of the hotel owners in attendance said they planned to finance or refinance hotels this year.
Clearly, hoteliers in attendance feel there is a lot of runway remaining in this cycle for hotel sales and buys. Much was discussed in the opening general session about the news this week that Anbang Insurance Company is making a play for Starwood Hotels & Resorts Worldwide—an indicator that the global hotel industry is still an active one.
Thursday promises a full slate of speakers and panel sessions, so stay tuned.
Quote of the day
“Things, they are a-changing. Ask Marriott and Starwood about Anbang. Ask the Republicans about Mr. Trump. Ask the disruptors panel speakers about Airbnb. Things, they are a-changing.”
--Bob Hunter, CEO of Hunter Hotel Advisors, on the ever-changing nature of today’s hotel environment
Photos of the day
Wednesday turned out to be confirmation day at the 28th annual Hunter Hotel Conference. The 146 minutes it took to complete the opening session—moderator Teague Hunter actually finished the “State of the Industry panel four minutes early—a number of topics were verified by speakers, including:
- Blackstone’s Brian Kim acknowledged his firm is selling Strategic Hotels & Resorts to China’s Anbang Insurance Group. The deal, which hasn’t been completed, has been rumored but unconfirmed since the beginning of the week.
- Wells Fargo economist Anika Khan said there’s a 23% chance of a recession this year, but all indicators point to the hotel industry remaining positive.
- The perceived doom and gloom surrounding the industry is mainly emanating from New York. Tyler Morse, CEO of MCR Development, said the massive oversupply in Manhattan is the chief culprit for NYC-based pundits being so pessimistic.
- There’s plenty of debt available now, but that could change as loans come due and will need to be refinanced during the next 24 to 36 months, according to the speakers on the “State of the Industry” panel.
While attendees recognize there is a relationship between Main Street and Wall Street, the general vibe at the conference during Day One was that there’s no need to panic over what appears to be a correction in the cycle.
--Jeff Higley, @jeffhigley1
The biggest news out of Day One of the conference was slightly hidden. During the “State of the Industry” general session panel, Brian Kim, managing director of real estate for Blackstone, confirmed the company’s sale of Stategic Hotels & Resorts to Anbang Insurance Group. He said the deal had not yet closed, but indicated it was in the works. That was big because until now, news reports on the deal relied on anonymous sources and outlets hadn’t been able to confirm the transaction with the companies involved.
Overall, the tone for the first day revolved around change, and how the hotel industry was adapting to meet that change. Speakers talked about this week’s potential disruptor to Marriott International’s acquisition of Starwood Hotels & Resorts Worldwide. They talked about Airbnb, and of course they touched on the travel habits of the elusive millennial traveler. One of the best points was made by guest speaker Terry Jones, chairman of WayBlazer.com, when he said, “Disruption is with us. I think it’s plural—it’s disruptions. Disruption and innovation are really two sides of the same coin. Let’s focus on being the innovators. Then other people can worry about being disrupted.”
Through it all, one thing everyone agreed on was that 2016 would not be a year of recession. The industry has more time, it seems.
--Stephanie Ricca, @HNN_Steph
There was a chunk of Day One’s “State of the Industry” panel that focused on the possible future impacts of new supply, and it was interesting to hear panelists’ different thoughts on the future of Airbnb and who Airbnb could affect. Panelists agreed that Airbnb is not a threat to the industry right now, and said the impact of Airbnb depends on the market.
“Airbnb is not a factor in suburban New Jersey. In the suburbs outside of Denver, it just doesn’t matter,” Tyler Morse, CEO and managing partner at MCR Development, said. Morse later said that Airbnb would eventually be just another online travel agency.
Change in the industry was a main theme presented during Day One sessions, and panelists on the “State of the Industry” panel added that guests’ changing expectations could factor into Airbnb’s success. Rockbridge CEO James Merkel said more customers are looking for unique experiences and hoteliers should pay more attention to customer’s needs than the potential threat of Airbnb.
“We talked about lifestyle brands and how many lifestyle brands there are, and everything is lifestyle. Every brand is trying to cater to what the customer wants today,” Merkel said.
--Danielle Hess, @HNN_Danielle
Tweet of the day