ALIS: Brand Company Execs Confident in Recovery
Arne Sorenson didn’t back down from his “wildly optimistic” viewpoint about the industry’s recovery that drew the attention of his boss, Bill Marriott, and the rest of the industry. In fact, eight months after his comments at the New York University International Hospitality Industry Investment Conference, the normally reserved Marriott International president said he believed it with even “more force” now and that a “very broad economic recovery was underway.”
“Today you have to find markets without strong signs of a recovery,” said Sorenson last week on a panel of brand company executives at the Americas Lodging Investment Summit in San Diego. “Last year we had to find markets with strong signs of recovery. Last January here was a totally different world.”
Sorenson wasn’t alone in his view. The mood from the majority of speakers and attendees, from inside and outside the conference sessions, was one of confidence. It was more than the “cautious optimism” front put on by the same brave crowd the past two years.
As the opening panel of industry analysts confirmed at this year’s conference, there was positive trajectory in operating results from a year ago and projections for even more this year. Smith Travel Research projects a 6.1-percent jump in RevPAR, while Colliers is even more optimistic with a forecasted increase of nine percent.
Best Western CEO David Kong, on the same panel with Sorenson, said the rebounding stock market was a leading indicator of lodging’s recovery. Frits van Paasschen, CEO of Starwood Hotels & Resorts, said the paranoia of the past, in particularly the AIG Effect, was behind the industry. He said meetings business has lagged some, but continues to build and that December was a record month for Starwood in booking group business.
The brand company leaders all expressed concern over unemployment numbers that could slow demand and the economic recovery. But Sorenson pointed out the surge in outbound travelers from countries like China would create jobs here. As an example, he cited a projected 100 million Chinese would travel abroad in five years.
“We’re all vying for pieces of the same pie,” Kong said, “but if the pie was twice as big, that would be good for everyone. We all need to work together.”
Kong said the visa and customs processes need to be improved so more of those international travelers would visit the U.S. “It’s a simple thing to push for,” Sorenson added. “We all need tell our elected officials.”
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© 2012 Penton Media Inc.
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