Excerpt from CoStar
Executives speaking during the first day of the Hunter Hotel Investment Conference offered reassurance amid worries over global conflict, inflation and an ongoing pandemic.
Whether concerns that higher gas prices could deter leisure travelers from taking a road trip this summer or that another wave of COVID-19 could wreak havoc on certain hotel segments, the overall theme was that the worst is behind us.
Adam Sacks, president of Tourism Economics, told attendees that regardless of fuel prices increasing, people will still consume the same amount of gas as they typically would it and will not change travel patterns.
Overall, domestic leisure travel will continue to the win the day, he said.
Despite headwinds such as fuel prices, inflation and the effects of Russia’s war in Ukraine, hotel industry optimism is on a roll — for now, at least. There’s so much interest in hotel deals, and the sweet spot continues to be select-service hotels and extended-stay hotels. Investors are chasing margins. They know what they’re dealing with to some extent with labor costs and other variable costs in the hotel, but they’re itching to spend all that pent-up capital, so more deals are happening.
“I’ve been through a few [recessions], in 2001 and 2008-09. This is what’s different about this one: The last two were absolutely economic crises — especially the Great Recession. This is a medical crisis. This has disproportionately impacted our industry.”
— Mitch Patel, president and CEO, Vision Hospitality Group
“The Great Resignation has hurt the hotel and service industries far more than anyone is talking about.”
—Suril Shah, CEO and managing partner, Riller Capital, about industry headwinds on the “Wall Street Talks” panel.
The first day of the Hunter Conference kicked off with an exciting merger announcement between the American Hotel & Lodging Association and Castell Project, in which the two will pool their resources to form "Castell, an AHLA Foundation Project" and continue efforts of advancing women in hospitality. In addition, attendees are having conversations about the next generation of hoteliers, indicating that the hotel industry is paving a way forward to evolve the talent pipeline more than it ever has before.
However, hotel CEOs speaking on the "C-Suite Conversations" general session acknowledged that the hotel industry is up against big-box retailers for talent, and the hotel industry has historically underpaid its workers.
"We need to compensate competitively," said Wyndham Hotels & Resorts President and CEO Geoff Ballotti.
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