Here is a summary from some of the meetings HOTELS held with hotel company executives during the 2016 NYU hotel investment conference:
Steve Van, Prism Hotels & Resorts, Dallas. Known more as a special servicer, Van made it clear the company has a substantial portfolio of more traditional third-party management contracts with some 4,000 full-service rooms and another 1,000 in select-service.
Prism was recently chosen by Hyatt Hotels Corp. as a preferred manager and announced it has been engaged to manage the largest Hyatt Regency franchise in North America, the soon-to-be 581-room Hyatt Regency Los Angeles International Airport.
It also recently won contracts for the 428-room Hilton Tucson El Conquistador Golf & Tennis Resort, the 290-room Hilton Baton Rouge Capitol Center, the 543-room Hilton San Francisco Financial District and the Embassy Suites Oklahoma City.
Van said Prism should announce another five big full-service contracts this year and, while the phone has yet to start ringing, he expects to earn more workout deals from lenders in the not too distant future.
Elie Maalouf, IHG, Atlanta. The Americas CEO offered updates on brands, loyalty/direct booking and technology, focusing first on the US$200 million Crowne Plaza Accelerate plan, which will run for a three-year period, with design-led, culturally relevant, technology-enabled solutions to “Make Business Travel Work.” Maalouf said the plan is designed help enhance brand performance while creating a guest experience with modern swagger.
IHG’s investment will focus on increased sales and marketing efforts and continuous improvement of the guest experience. In addition, IHG will continue to selectively invest to secure high-quality Crowne Plaza hotels in key markets. “The foundation is in place. Now we have to accelerate the plan,” he said.
There are 13 Crowne Plaza’s in the U.S. pipeline, including a new deal in New York City, and 80 globally. “We expect the pace to ramp up and want to put more muscle behind it,” Maalouf added.
Maalouf also boasted about five InterContinentals in Q1 with New York’s Barclay coming back online, soon to be followed by the big Los Angeles project.
He said IHG is working on getting into Cuba and will be rolling out its cloud-based Amadeus res system next year.
As for Holiday Inn, the new Express prototype saw 50 open last year with 350 projected by the end of this year. Express has IHG’s biggest pipeline with 470 hotels in the Americas open at the end of Q1. The core Holiday Inn brand has another 130 hotels in its pipeline.
Jonathan Tisch, Loews Hotels, New York City. On the day the NYU hotel school was renamed the Jonathan M. Tisch Center for Hospitality and Tourism, the conference chair for the past 24 years first talked about the state of affairs in New York City, where RevPAR dips have dragged down national numbers.
Even with visitor numbers approaching 60 million, increased room supply in New York have zapped pricing power, while expenses continue to rise and pressure profitability, according to Tisch. “The next few years will be tough on profits,” he added.
Having invested US$1.2 billion over the last three to four years on acquisitions and repositionings, Loews remains an aggressive owner-operator that has been looking for a portfolio deal, but Tisch said to date they have not liked the pricing on the bigger opportunities presented. The company owns and/or operates 24 hotels and resorts across the U.S. and Canada, including the newly acquired Hotel 1000 in downtown Seattle that will be rebranded into a Loews Regency in 2017. Loews Sapphire Falls Resort at Universal Orlando, the fifth hotel in partnership with Comcast NBC Universal, will open in July.
In the meantime, the group, known for its group business, is putting great emphasis on growing transient booking by putting a bigger effort into sales and marketing. Tisch himself is very active on the design side, personally approving the choice of every fabric, piece of furniture, wanting design to relate to the location and meet traveler needs. “We like clean spaces, taking the clutter out for visual impact and creating greater comfort,” he said.
Ron Pohl, Best Western Hotels & Resorts, Phoenix. Thailand was the headline for Best Western, where Pohl said the group has four new deals – three of which will be the biggest hotels in the portfolio, ranging from 500 to 1,400 rooms and totaling 4,150 key under the Plus brand. This marks the largest multi-hotel deal in company’s 70-year history.
Two Vib’s were also signed for Bangkok, as were deals in Yangon, Laos and two in Seoul.
Pohl also spoke about new traction in Indonesia, where a new master franchisee already with 14 hotels has committed to developing 11 more Best Westerns. There is also a new master franchisee for India.
In the U.S., 250 hotels are in the pipeline with a focus on the Plus brand for new construction. There are even a few dual branded Plus-Executive Residency where the brands are mixed by floors, not by buildings. Pohl says 24 dual-branded hotels have been signed since last July with particular strength coming in Texas.
Pohl pointed to Best Western’s ability to put key money into deals as the impetus behind growth, which has become more feasible with the new 10-year, 5% fee model. “It got us into markets we need to be in – mostly urban,” he said.
The BW Premier Collection with 34 hotels open is taking off in Europe, according to Pohl. He said one soft brand hotel is opening every two weeks and he boasted about a deal for a 500-room resort in Orlando, Florida, which will become the biggest Best Western in North America.
Lastly, Pohl spoke about how virtual reality technology is aiding in training at all 2,100 hotels in the U.S. and Canada, primarily for front desk personnel, through Skype. He added that consumer-focused VR will launch in July.
Javier Coll, Apple Leisure Group, Philadelphia. After closing out 2015 with 17 new resort deals, expanding into seven new destinations and increasing the brand’s management portfolio to 20,000 rooms, Apple Leisure Group recently signed a deal in Puerto Rico which will bring the first truly all-inclusive resort to the island.
The largest operator in the Caribbean with 44 hotels open and another 15 signed loves the all-inclusive concept and does so with six different brands that are strongest in Cancun, Riviera Maya in Mexico, followed by the Dominican Republic and Cuba.
It drives business through subsidiary Apple Vacation’s 2 million passengers and all the travel impressions it brings through travel agents.
Apple Leisure is focused on adding Caribbean markets like St. Lucia and Turks & Caicos and Coll said eight to 10 deals should be the average pipeline for the next few years.
With its exposure in Latin America where the Zika virus is a big concern, Coll said to date it has only had a small impact on honeymoon business.