Top Owners/Managers Say Industry Soaring
When we held HI Connect Design a few weeks back in Nashville, TN we wanted to get the straight scoop from those that actually own and operate hotels. After all, these are the folks that truly feel the surges and sinkholes when it comes to profitability.
Here?s what we already know. The industry is in pretty good shape and should stay that way for the foreseeable future. But how? Why?
To get the answers those and other burning question we held a panel discussion right in the center of the action at HI Connect Design where we gathered some of the heads of the country?s top ownership and management groups to share their thoughts on the state of the market and other major issues affecting our exciting industry.
Mike Marshall, President and CEO of Marshall Hotels & Resorts, believes the time is right for guests to pay for more hotel rooms and they are willing. But to get them to dig a little deeper into their wallets the hotel has to be in great shape.
?There is a lot of real bad product in the market and there is a need for many to see a refurbishment.? And I think you?re going to find that we?re going to see a lot more PIPs because we?re going to start to see [many more] transactions occur and we?re going to see PIPs from that. We?ve recently taken over two hotels for institutional owners, who bought paper, got into them, and the hotels were absolutely wrecked.? I mean so it?s everything we?re going to do to bring them back to life and you?re going to see a lot of that coming.
Speaking of institutional investors, Jerry Cataldo, President and CEO of Hostmark Hospitality Group believes institutions are once again seeing hotels as a great investment class and they?re ready to put their money into this class of real estate.
?There?s a lot of equity and capital on the sidelines that would like to invest in this, in the hospitality field.? It?s finding the right product.? Up to now it?s been a challenge, because a lot of that money was chasing the same type of product, but I see that changing as the improvement in the industry as a whole, people are looking for other opportunities and now are willing to look outside of maybe the top 10 markets and the urban markets.
If I had a concern, I think it?s really understanding your product type within its local marketplace and I think there?s many markets ? such as suburban markets, airport markets –that are where I think you?ve got to be very careful and think twice about whether you want to own a full-service property in those markets,? said Cataldo.
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