I attended many sessions and chatted with or interviewed scores of lodging executives during the recent Americas Lodging Investment Summit in San Diego. Here are few nuggets of industry intelligence I gleaned during the week:
1. Once recovery comes to the hotel industry, “the rebound will be larger and more robust than in past cycles,” said Art Adler, managing director and CEO of Jones Lang LaSalle Hotels. He cited three reasons: operators have shown they can manage effectively under stress; distribution channels are more efficient and less reliant on third-party sources; and the recession and lending freeze will choke off most new supply.
2. Saying he's pessimistic about the prospects for any large development projects in the next three to four years, Marty Collins, CEO of Gatehouse Capital, quipped, “To be a developer today requires more faith than [TV evangelist] Joel Osteen has.”
3. If you're an owner who's had trouble meeting your mortgage payments, Rich Warnick of Warnick + Co. offered some encouragement: “In this cycle, lenders have few options but to work with their borrowers. Taking back properties would only further devalue them.”
4. Calling the economic environment “not the worst I've seen but not good,” Continental Airlines Chairman and CEO Larry Kellner said he'd be “happy if recovery comes in 2010.” He believes airline capacity, which shrunk considerably last year, could contract further if the cost of fuel rises and the economy stays soft. That's not good news for the hotel industry, especially those properties in airlift-dependent resort locations.
5. Each of these large hotel investment conferences usually generates a unique catch phrase, e.g., Stay Alive ‘til '95, to capture the mood of the industry, None surfaced at this year's ALIS, although conference chairman Jim Burba offered a few possibilities, none of which really encapsulate where the industry is today:
• Still Not Fine in ‘09
• Doing Fine by the End of ‘10
• Finally in Heaven by ‘11
• On Track Again by 2010
6. A note to whoever wrote the script to the faux game show, CEOs Face Off, in which sets of past, present and future hotel company presidents squared-off in a Jeopardy-style format. While it would be a more relevant answer at a hotel conference, A&W Root Beer wasn't founded by the Marriott family nor named for Alice and Willard Marriott. In fact, Roy Allen and Frank Wright launched the branded in 1922 in Lodi, CA.