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Déjà vu at NYU

I hate to say it, but being at the NYU investment conference this week in New York City is giving me that all too familiar sense of déjà vu. No one is sure what to expect as our global economy remains unsettled. While sheer will to drive this recovery is laudable, caution is back as the watchword.

Sure, the top execs on stage speaking to the crowd of 1,500 or so have their collective chins up with optimistic outlooks. And yes, business is better here in the States, especially New York City, but some say privately it has been the result of a lack of new supply. Yes, rate is growing a bit in the United States, and occupancies are strong, but a lot of that is based on easy-to-beat comps, and that is going to change soon.

While optimism prevails on stage, here in the hallways of the Marriott Marquis there are whispers about growing owner-operator friction. A hot topic of conversation is the high profile, contentious battle at Miami’s Setai, where manager GHM was tossed out in the middle of the night by the hotel’s ownership group. Now word has it that Auberge Resorts has been moved out by ownership of Encantado in Santa Fe, New Mexico, in favor of Four Seasons, which uncharacteristically is growing via opportunities such as this.

Further evidence of caution comes from the many designers and procurers in attendance at NYU who are lamenting a recent slowdown in business — mostly due to a lack of certainty about economic conditions. Even conversions and renovations are slow to get done.

Hyatt CEO Mark Hoplamazian stated in the CEO session on Monday that an improvement in employment data is needed for a durable U.S. recovery, while Marriott International CEO Arne Sorenson admitted he is not as bullish today as he was maybe three months ago. “You can’t ignore what the market is telling us,” he said, adding that while performance still looks strong, he is worried about Europe and politics in the United States.

And so it goes, again. Uncertainty reigns, and it could be several more years before we get beyond the point of worry.

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