NEW YORK—While recent iterations of the NYU International Hospitality Industry Investment Conference have centered around discussions of if the industry is approaching the end of the cycle, this year’s installment seems to have largely moved passed that.
This year marks the 40th year of the conference’s existence, and Jonathan Tisch, chairman and CEO of Loews Hotels, kicked the show off this year comparing to how different the hotel industry was in 1978. He noted in that year much of the actual work for booking travel was carried out by travel agents, and today much of that research and bookings are made via mobile devices.
Day One recap video
Photo of the day
Chef Giada De Laurentiis shares a light moment with Noble Investment Group chairman Mitesh Shah (right) and Caesars Entertainment president of hospitality Bob Morse during the launch party for Caesars’ move into the non-gaming hotel business. The announcement, made at the Rainbow Room in New York, means that Caesars plans to expand its Caesars Palace, Cromwell, Flamingo and The Linq brands in non-gaming environments. (Photo: Jeff Higley) |
Quotes of the day
“As we know, our industry has become global; it’s changed and evolved. Forty years ago (when the NYU International Hospitality Industry Investment Conference began), travel was still considered a luxury and traveling by air was a really big deal. Today, travel has become routine; travel has become democratized. Today, travel represents an $8-billion international market, roughly 10% of the world’s GDP.”
—Jonathan Tisch, chairman and CEO of Loews Hotels and conference chair
“I think we’re in an absolute war for who owns the customer. It is a long-term war. … We have disruptors who are without a doubt trying to take ownership of our customers. I think less about Airbnb than I do about Google and Facebook and all of these digital empires who own all of us. You can add Amazon to that list, too.”
—Arne Sorenson, president and CEO, Marriott International
Tweet of the day
Jonathan M. Tisch delivered the opening keynote remarks at the 40th annual @nyuhospitality conference. He stressed that “when it comes to defending travel, the hospitality industry must remain vigilant.” #NYUhospitality pic.twitter.com/cvRPPAWMZz — NYU Hospitality Conf (@nyuhospitality) June 4, 2018
Slide of the day
Stronger-than-expected performance thus far in 2018 has led STR officials to revise their full-year projections for performance up. (STR is Hotel News Now’s parent company.)
Editors’ takeaways
For hoteliers in 2018, it’s all about action. That was clear from Day One of 40th annual NYU International Hospitality Industry Investment Conference as the message was decidedly focused on shifting into high gear. Whether that is with legislative issues, infrastructure challenges or by “simply” knowing your guests, being proactive is more important than ever.
It’s the last point that drew the most engaging conversation on the CEO panel. Knowing guests in the most basic form—interacting with them on a day-to-day basis—is something that third-party “disruptors” can’t come close to understanding the way a hotelier can. The intimate nature of hotel rooms gives hotel companies a chance to get to know their guests. Hilton President and CEO Chris Nassetta talked about it. So did AccorHotels Chairman and CEO Sébastien Bazin, who even wondered aloud how many children have been conceived in hotels over the years—which drew giggles, laughs and even a little blush fellow from panelist Jim Murren, chairman and CEO of MGM Resorts International.
Hoteliers must be aware of outside influences. Acting on their understanding of guests is more powerful than anything else in the hotel industry today. Marriott International President and CEO Arne Sorenson said the battle for customers has reached war-like status and worries about companies like Amazon, Facebook and Google coming into the industry.
That doesn’t mean hoteliers shouldn’t know their competitors. It’s all about properly defining them. Bazin said he spends just 5% of his time worrying about hotel competitors and 50% of time worrying about disruptors and learning that ecosystem.
The action goes well beyond the brands. During a general session about action in the real estate investment trust sector, Tom Baltimore said his Park Hotels & Resorts is ready to go on the offensive and acquire hotels. So did Host Hotels & Resorts’ Michael Bluhm and Hospitality Investors Trust’s Jonathan Mehlman.
The REIT action thus far has been geared toward refinancing as the debt markets remain red hot, panelists said. Now we can expect more deals in the sector—including more consolidation.
All of the action aspects floating around the industry today could end in a heartbeat, but the belief among most of those executives roaming the halls of the Marriott Marquis is that it’s unlikely to happen minus a black swan event.
—Jeff Higley, editorial director
@jeffhigley1
While the Americas Lodging Investment Summit in January may signal the kickoff to the calendar year, the NYU International Hospitality Industry Investment Conference in June is really the kickoff to the industry’s fiscal year, if you think about it. Everyone’s optimistic at ALIS, and by the NYU conference, reality usually has set in, and that optimism is a little tempered by how actual performance is shaking out.
This year though, that optimism is still going strong. During the “CEOs Check In: A View From The Top” opening general session panel, moderator Betty Liu from Bloomberg Television asked the CEO lineup about what they saw as the biggest change in the past 12 months, and they all essentially agreed that they feel better now than they did a year ago.
“If you think about being here a year ago on this stage, maybe ‘fear’ is a strong word, but there was quite a bit of trepidation about where the industry was going from a fundamentals point of view,” said Hilton’s Nassetta. “I think the biggest change is that while we have things to worry about, everyone in the room feels a lot better than we did a year ago.”
—Stephanie Ricca, editor-in-chief
@HNN_Steph
As handwringing over the potential end of the cycle seems to have subsided, the growing difficulty of staffing a hotel seems to be becoming the top issue based on discussions during the first day of NYU. A lot of the discussion from CEOs on the first day took a somewhat aggressive tone, pinning a large amount of responsibility for that problem at the feet of federal policymakers.
With unemployment hovering at lows not seen in decades, and immigration policies not only restricting the avenues hoteliers have to find new employees but potentially endangering current employees, the frustrations of the hotel industry at-large seem to be reaching the boiling point. Marriott’s Sorenson mentioned in his remarks that the tight labor environment makes it all the more important for hotel companies to take care of their people. Hopefully, hoteliers heed that call.
—Sean McCracken, news editor
@HNN_Sean