Disruptors dish at ALIS on latest in development

LOS ANGELES — Dana Jacobsohn says that remote work has changed a lot of industries, and hospitality is chief among them.

“What’s remarkable to me is remote work and how it has completely influenced the customer and therefore changed the hospitality industry… Consumers are changing and focused more on long stays,” said Jacobsohn, chief development officer for Marriott International. “As the customer is so focused on long-term stays, more space, kitchens… Marriott now has the tools and the expertise to grow in that space. What was a resident of Marriott, at least a Residence Inn/TownePlace Suites brand kind of resident, is now across all of our segments.”

Jacobsohn said the desire for extended stays at an affordable price is why Marriott created its newest brand, StudioRes, which had its first project break ground in Florida last week.

“That business model is focused on long stays. It’s an efficient business model with low staffing and high occupancy. And it’s something that the developers are asking for,” Jacobsohn said. “The customers for StudioRes in the midscale space are traveling nurses, construction workers on assignment, and government workers working on the infrastructure bill… We’ve seen this desire for customers to stay for a very long time is global. This is happening all over the world for Marriott.”

Jacobsohn and three other hospitality executives were on a “Development Disruptors” panel on Monday’s first day of the Americas Lodging Investment Summit (ALIS) at the JW Marriott at L.A. Live in Los Angeles.

The panel featured Jacobsohn, Robin Kennedy, EVP and chief development officer for Montage International; Rachel Moniz, COO for HEI Hotels & Resorts; and Monica Xuereb, chief commercial officer for Loews Hotels & Co. The panel was moderated by John Lancaster, vice president of emerging markets for Choice Hotels International. 

Luxury space

When asked about new patterns in the luxury space, Kennedy said that customers are changing, too.

“The customer broadly is changing those longer term stays, but the luxury guest is untethered,” she said. “They can go anywhere at any time, and it changes the patterns in how we see the stays and how they’re experiencing the stays.

“They’re looking for not only the ability to have more space… So, they’re untethered and always on. They're looking for those moments also to turn off and disconnect. Wellness is a big part of what we’re starting to see focused on in the resorts. It’s not only the spa stays. It’s how they’re experiencing recreation, getting out of the environment and finding those moments… If you’re programming your hotel and thinking about how you’re providing experiences, guests will continue to come back.”

Customer patterns

When asked what customer pattern she sees emerging, Moniz said it’s in technology.

“Technology is really important to the customers. And I think this industry is a little slow regarding tech,” Moniz said. “But then there’s also the risk of the shiny new toy that everyone buys and convinces owners to spend tens of thousands of dollars on, and then it doesn’t get used properly.

“It’s a balance; I certainly think that if we’re going to appeal to the next generation that’s now starting to spend money, then we’re going to need to invest in technology that’s meaningful to our customers… It’s a matter of figuring out what’s important to that particular customer and then delivering on it, and technology will always be top of the list. And it’s equally as important to cut out the things that aren’t necessarily important to that.”

Public-private partnerships

Xuerub was asked about a successful public-private partnership Loews partnered on with the city of Arlington, Texas. The city has the stadiums of the NFL’s Dallas Cowboys (AT&T Stadium) and the MLB’s Texas Rangers (Globe Life Park) but has a severe shortage of hotel rooms and an aging convention center.

She said in 2017, the company opened a 300-key Live! by Loews - Arlington, Texas and saw incredible event demand, to the point where it could charge $800 a night rates in a market that was sub-$200. She said Loews also saw longer stays. In addition, Arlington was seeing great demand for groups who had never considered the city.

“They came to us and proposed a public-private partnership to build more rooms... We saw an amazing opportunity to build an 880-room hotel and build the Arlington Convention Center as part of the project. So, here we are working with the city on the partnership documents being his barely dry and COVID hits.”

Xuerub said the company navigated the pandemic and found a loan for the project in a challenging credit market. It is now opening in a few weeks.  

“The biggest benefit of taking a risk during the pandemic is that we managed to secure great financing and secure pricing on construction that saved us millions of dollars because of the massive inflation costs that followed. And on the commercial side, we have over 260,000 room nights on the books for this hotel. So I think we’re on our way.”