Europe?s mixed bag
There was much more exuberance (irrational?) a few months ago at the Los Angeles conference, but while more conservative, everyone here does seem busier — even if more than one observer said they are starting to worry about Spain’s economy and the potential stronger shock difficulty could bring with it.
Here are a few nuggets and observations from my first day in Berlin. As usual I talked to a few developers and salespeople selling more hope than reality, but for brand leaders like Starwood, it is steady as she goes. Hilton remains hot, and I will hear more from them and Marriott in upcoming interviews. Accor, Meliá and Wyndham have big stands here, and if you look closely you can see a sprinkling of Asian and Middle Eastern cash looking to spread the wealth outside of their own regions.
Simon Turner, Starwood’s head of development, said consistency with its leadership team, a locked strategy and even a more pragmatic approach helped deliver 81 new hotels and 112 deals in 2011, and more of the same looks to be the order of the day. Three-quarters of the Starwood pipeline sits outside a mature North America, where conversions and firm terms remain the play. In total, Turner said Sheraton and Four Points in China and North America account for half of the company’s action.
When asked about lessons learned from China, Turner said he found out his domestic team there made it clear the company is no stranger in a foreign land. Yes, China remains the hot spot, and the momentum is moving inland, where brands like Aloft and Four Points have traction.
Interstate Hotel & Resorts’ Ed Blum and Aaron Greenman said performance is better in Europe, and its third-party management pipeline is stronger this year as it gains traction in India, shows continued growth in Russia and can boast about the conversion of nine office buildings in the Netherlands with Holiday Inn Express, Holiday Inn and Hampton winning management.
Legal eagles DLA Piper UK authored new research and told me they expect insurance company money to come into the European market as deregulation looms. In addition, as foreclosure owners in Europe look to negotiate shorter-term management terms, look for more hybrid deals. They, too, warned of the distress Spain could soon bring to the marketplace and to watch for more money coming into hotels from places like Turkey and Korea.
Fun interview of the day: Sexy Buddha Bar concept out of Paris is soon to open its second hotel in Budapest, Paris in November, deals in Abu Dhabi and Mexico City, as well as negotiations from Armenia to Tel Aviv, Bora Bora and Panama.
The crowd is up, both in numbers and attitude, and I expect to hear and feel more of the same in upcoming meetings with — among others — Meridia Capital, Hilton, Marriott and the WTTC on my docket. I’ll let you know what I hear.