Insights from the Hospitality Investment Summit
Jack Pulvirenti, CPA
01.15.2018 | Berdon Press Release
Some of the leading figures in the hospitality industry shared their insights and their vision for the future at the Bisnow Hospitality Investment and Development Summit held on January 10th at New World Stages in New York City. I had the pleasure of moderating the Creating & Maintaining a Brand panel and here are some of the participant’s responses to key questions:
What impact does food and beverage (F&B) bring to your hotels?
For Matt Livian, CIO, The Sydell Group, it’s about the story, tuning into the local culture in a particular market, and making a project interesting. “Our secret sauce for F&B, has been tapping into local talent and partnering with people who we think are not necessarily prolific, but interesting and on the cusp of really great things in their careers,” he says.
But it also relates to design. Livian adds, “It goes to everything from people’s uniforms, to the design of the guest room, to the art on the wall, to how we train our staff to interact with people. We think it’s really the whole compliment that makes a great hotel.”
Naveen Kakarla, CEO, Hersha Hospitality Management says his approach has changed. “Whether it’s a food truck, or a grab and go, or some type of really intricate bar concept, we’ve evolved to actually encourage more food and beverage.” Kakarla notes that F&B is “… our most notable amenity. It’s the thing that’s being photographed, talked about, and remembered the most.”
With ever increasing competition in the boutique space along with a proliferation of big brands, how do you go about differentiating yourselves and communicating your message?
“I think the brand of one is what the consumers want,” said Allison Reid, Chief Development Officer at Kimpton Hotels & Restaurants. “They want to see something different every time.”
Livian said, “It goes to just good old fashioned hospitality. Recognizing guests that have stayed with you time and time again, and doing it in a way that’s … authentic and really speaks to them.”
He added that you should take notes on what they like, and make sure that those products are available to them in their guest rooms. Livian noted that a personalized level of service is something that larger peers with more layers, might have a more difficult time doing.
Has the branding program for hotels been altered in any way by Airbnb’s success?
Noah Silverman, Chief Development Officer, North America Full Service Hotels, Marriot, thinks Airbnb has somewhat missed the mark around the communal aspects of travel. A lot of Airbnb units are single rooms in a building, or somewhere where there’s no place for people to engage with the broader community.
“Our focus is on activating lobbies, bars, restaurants, etc., to make spaces within hotels more attractive to people who want to be around other people,” says Silverman.
Livian does view Airbnb as competition, but agrees that the ability to interact is limited when you are in a single apartment. He wants to leverage, “… the tools we have that Airbnb doesn’t. And I think that goes to public area, communal space, creating culture around our hotels, creating a place where you can interact with locals.”
With Airbnb, Livian adds, “… at the end of the day, you’re going off to somebody’s apartment. You’re not walking down to a lobby that’s active, or a bar that’s active, or taking part of programming.”
What are the benefits of social media for the hospitality industry?
For Kakarla it is not about being an advertisement and more about trying to bring forward things that are happening that week, or in that neighborhood.
“There [are] two things that basically get photographed and put up on [social] media— travel and food,” said Silverman. “If that is a generational push away from collecting things, and starting to collect experiences, our industry really should be a tremendous beneficiary of that for a long time.”
What is the biggest challenge you face going into 2018 and beyond?
Reid sees two things. “One, to pull off really good hotels, especially in your tourist areas, you have to get good labor. And I think we’re going to continue to compete with that.”
Second is ongoing changes in consumer preferences. “Bars are in. Bars are out. Gyms are in. Gyms are out … I think smart people will react to that quickly.”
A recent movement of larger brands developing projects that replicate the boutique hotel model, observes Livian, will enhance competition for established existing boutique hotel brands. “… For us, it’s blurring the lines between what the big brands do, and what companies like ours do. I think a few years ago, the big brands didn’t necessarily focus on this lifestyle segment in the way that they do now.”
Obsolescence is becoming more relevant to Kakarla. “With so much new supply, and customer preference for new, and a changing set of tastes, it’s really hard to renovate and keep up at many of our hotels.”
With such rapid changes in tastes and preferences, Kakarla adds that maintaining competitive market share, while following traditional capital renovation cycles, currently at every 12 to 18 years, will be a challenge. “I don’t know how exactly you break that compromise, but we definitely lose a lot of sleep about being fresh and new and interesting in an industry where it takes a lot of time to mobilize and renovate a space.”