DALLAS—In a session last week at the Lodging Conference, Dave Johnson of Plano-based Aimbridge Hospitality talked about the role of loyalty, technology and retaining talent within the hospitality structure. In that session, A View from the Top, moderator Don Landry of Top Ten Hospitality Advisors led the discussion focused on those topics along with markets to watch and hotel security.
Landry began by saying that with the chaos in Washington, DC, it is unlikely that substantial legislation will be passed in the remainder of the year. Within the hotel sector, demand is strong and supply is stronger, he said. Low-cost debt is out there and that low-debt environment invites new supply. Chinese funds still remain prevalent in the United States. The big question is when will rates go up?
Turning to some of the micro-issues within each hospitality operation, the panel weighed in on the challenges and opportunities for acquisition, development and lending, short-term and long-range impact of new brands on independents and soft brands, potential derailments that would impact demand and supply forecasts, financing trends and danger zones, and critical factors for success in 2018.
To begin, Eric Danziger, chief executive officer of Trump Hotel Group, said he believes the industry relies too much on technology.
“In addition to technology, there's this service enhancement and that service enhancement,” Danziger said. “I think we should go back to the business of hospitality.”
Michael Barnello, president and chief executive officer of LaSalle Hotel Properties, said the recovery costs due to the hurricanes in Texas and Florida will be impactful. In addition, he agreed with Danziger about the over-emphasis on technology.
“I've never heard of someone picking a hotel because you can open the door with a phone,” he observed.
Geoff Ballotti, president and chief executive officer of Wyndham Hotel Group, had a different take, saying technology and loyalty have never mattered more. He also tied the loyalty discussion into a correlation with brands.
“We are distributors of brands,” Ballotti said. “I don't think there are too many brands.”
Johnson agreed that loyalty has never been more important and the number one issue for Aimbridge is talent. Some went as far to say it is the biggest threat to the industry.
“We sit back and let others take the lead on technology,” he said. “With scale, we keep more talent.”
Barnello said while labor is the biggest cost, his team is getting more efficient with back of the house operations and managing time is getting traction. Success in 2018 will include being nimble and turning the economy to mid-scale range on its head after a stale period from 1987 to 2014.
David Kong, president and chief executive officer of Best Western Hotels and Resorts, said hotels launch more brands because people want more choices. Kong said supply in secondary markets is Best Western's sweet spot because operating costs are low there.
Danziger said not all brands are worth saving and a hotel operation can be too big. With regard to hotel security in the wake of the recent Las Vegas shooting, he said there is more hotel operators can do.
“It should be a learning opportunity,” Danziger said. “We should look closer at protecting guests and employees.”
Barnello went a step farther about hotel security.
“We should change the laws of this country instead of placing the burden on hotels,” he said.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Lisa Brown
Lisa Brown is an editor for the south and west regions of GlobeSt.com. She has 25-plus years of real estate experience, with a regional PR role at Grubb & Ellis and a national communications position at MMI. Brown also spent 10 years as executive director at NAIOP San Francisco Bay Area chapter, where she led the organization to achieving its first national award honors and recognition on Capitol Hill. She has written extensively on commercial real estate topics and edited numerous pieces on the subject.
