A recap of one-on-one interviews and a few notes from the CEO panel.
During
the course of last week’s Hunter Conference in Atlanta, we sat down with
various owners and operators, and of course listened to leaders share their
thoughts on the state of business.
Here
is a brief summary base on our notebook:
Steve
Kirby and Ed James, managing principals at Mumford Co. talked about the ongoing
dearth of deals, suggesting the ratio of buyers to sellers is 5:1. They said
full-service suburban properties are likely the biggest sources of potential
distressed sales. Among the latest transactions from the brokerage advisory firm celebrating its
45th anniversary: Hampton Inn
Lexington/Georgetown in Kentucky; Hilton Garden Inn Lexington/Georgetown in
Kentucky; and the Quality Inn, Beckley, West Virginia.
Ben Perelmuter, the newly named president and COO of TPG
Hotels & Resorts (45 owned/78 managed), is settling into his Dallas office,
which acts as the operations headquarters for the group. With a greater
emphasis on growth in the southeast and southwest, a Dallas office will also
better serve to support development. He said TPG will be opportunistic for
third-party growth and grow more organically in Texas. This comes after the
group opened a property about every two weeks last year. Perelmuter, who spent
15 years with Aimbridge Hospitality, said driving rate equals better flow
through, but in the next breath said labor retention can’t be overlooked in
that equation.
Justin Jabara, president of owner-operator Meyer Jabara,
boasted that 2022 was the company’s best year, attributing success to corporate
culture and restructuring after the pandemic started. The company currently has
32 hotels, about two-thirds with a meaningful ownership stake. The plan is to
grow the third-party business and the group is adding to its development team
this year to meet that goal. Jabara said the company is building its pipeline
slowly with some deals sitting in final planning stages, while a few others
push forward. Meyer Jabara will be more of an acquirer moving forward, using
strategic partnerships with family offices and PE firms, and is not an active
seller. Jabara lamented the cost of insurance and utilities, especially in
Florida, and hopes the worst is behind them.
Brian Young, evp and chief investment officer, Hospitality Ventures
Management Group, an Atlanta-based investment, ownership and management company, said they saw
business jump 30% in 1Q23 versus 2022 and is forecasting a 19% increase in
RevPAR in 2023 versus 2019. The pipeline has 10 projects coming alive in the
next six months, a mix of acquisitions and management deals. Cole added that
HVMG is selling some assets to help with refinancing. The group, currently with
53 hotels, is investing heavily in next generation
technology to capitalize on the large amount of data available internally. Thus
far, HVMG has committed more than $500,000 in data warehouse architecture and
visualization tools since 2021, with plans to invest further.

Yes, we’re going to have another story like the Federal Reserve or something else. But we should take courage from the fact that the industry has not been broken.
Elie Maalouf
The CEO session had a few noteworthy comments:
Elie Maalouf, CEO, Americas, IHG, on how he feels about the
industry at the moment: I am a long-term optimist. Yes, there is the pandemic,
supply chain, inflation, higher interest rates – it just hasn’t broken the will
of people to travel; it hasn’t broken this robust industry. Demand is near
record rates. Global travel is actually just resuming. China is just booming
again now. Europe is very strong. I was in Europe last week and everywhere I
went – Florence, Rome, London – they never had a low season. They’re expecting
a booming summer. Yes, we’re going to have another story like the Federal
Reserve or something else. But we should take courage from the fact that the
industry has not been broken. It's been interrupted here and there but the long-term
trends are really good. The fundamentals are unchanged.”
Geoff Ballotti, president, CEO, Wyndham Hotels &
Resorts: When we think about 2024-25 and beyond and the $1.2 trillion spent on
the infrastructure bill, and the other $300-400 billion that will be spent on the
Chips and Science Act, the opportunity ahead in the next 10 years is just
beginning… All the panels have been talking cautiously optimistic about select-service
development, obviously in reference to financing and getting those built, but I’m
really optimistic in terms of what’s to come during the midweek, end of weekend
from that infrastructure bill.