The preparation for the a prolonged down economy could keep some hotels floating while others fail and the panel zeroed in on what needs to be done to stay in the game. “Plan for a range of scenarios,” Sacco said. Starwood, he explained, was seeing an uptick in business travel, as well as some upward trends in occupancy and RevPAR, but it was unclear how steep those would be. Eisemann concurred saying, “Some positive things happened to the industry during the downturn.” He felt as a whole, the hotel industry has been good about looking at its books and creating a more efficient model for the times, but worried that as the economy returned, some hotels would add back features much too quickly.

McInerney said it could not be helped, that the anxious rush back to the old model seemed to happen after every down cycle, despite the lessons which should have been learned. He also explained that as the industry began to show profits again, the irony was that it would be harder to explain to the government why the industry needs money to survive. Magnuson was more dire, “This is bigger than a cycle, this is a major shift.” Magnuson felt the pared down model was the way of the future for most hotels.

A major question for hoteliers is how to develop property in a tight lending environment. Kirschke said, “You have to know exactly what you’re after.” He said the only way to do a development or redevelopment right now as to strategically plan what you want to do and accomplish. There wasn’t an option for other plans.

Finally, a hurdle facing every hotel across the country is how to keep costs low while revenue is eroding. Eisemann noted some of the issues that will face hoteliers in the next few months and years will be reinstating salary increases, whether or not to charge for high-speed internet or give it away, and the advent of technology and media driving revenue down on hotel televisions. He felt the best approach will be to examine brand standards and figure out if it was necessary and important to the customer, removing things to provide additional product. “It’s a math game,” Sacco summed up.

Eisemann also explained that “now’s the time” to drive rate increases. This was not a cure-all for revenue erosion, however. Eisemann noted that it was important to stay vigilant on cost. Magnuson disagreed with driving rates at this point in the economy. “You can’t drive rates and ignore supply and demand.” His solution was to position companies well online and hold-out for supply to tighten up. “Customers know the industry is running with 40% empty rooms every night,” Magnuson said, noting that guests with that kind of knowledge won’t pay a higher rate.