Interview subject: Scott Griffith, president and CEO of InTown Suites
Interviewer: Patrick Mayock, associate news editor, HotelNewsNow.com
Interview site: Hunter Hotel Investment Conference in Atlanta
Interview date: 17 March 2010
Patrick Mayock: “Hi. This is Patrick Mayock with HotelNewsNow.com. I'm at the Marriott Marquis in downtown Atlanta for the Hunter Hotel Investment Conference. Joining me is Scott Griffith, president and CEO of InTown Suites. Scott, thanks so much for joining us. I appreciate it.”
Scott Griffith: “Thanks for having me.”
Mayock: “Scott, to begin, let's just start generally. I was wondering if you could provide a state of the union of InTown Suites.”
Mayock: “Now, as an extended-stay property, what is the average length of stay for your guests?”
Griffith: “We measure it in weeks, not days. So it's several weeks, and that is a bit skewed from the people that stay with us for a very, very long time. But we also have a group of guests that are staying with us for shorter periods of time. But the minimum stay is always a week at InTown Suites.”
Mayock: “And are you looking at doing anything creative to help extend that guest stay?”
Griffith: “Absolutely. We've instituted some more discounted pricing and some monthly pricing, which we had never done before the 2009 summer season, and that's worked very, very well to increase the stay because the fewer check-outs we have, the fewer check-ins we need to replace them with. So that's the strategy there. That's kind of how the math works. And we've also spent the money in 2009 and 2010 where we think we can really help the guest experience in many of our suites, not just a few properties to, again, extend the stay of the guests.”
Mayock: “OK. How many rooms are in a standard InTown Suites property?”
Griffith: “We average 130.”
Mayock: “One hundred and thirty. And what is the typical ideal target market for one of your properties?”
Griffith: “We're very good in more suburban areas or on busy streets. We don't necessarily have to be right on the road, but we need to have a good sign at the road. Even to this day a third of our guests when they check in say that they found us because of the sign. A lot of people that are driving by, whether they are from the local area or they are from out of town, they see our sign. That is very, very important to us. We do not try to focus on interstate-type locations, a typical budget motel type of a situation. We're more like an apartment in many ways, and so we want to be on a busy street where people are going back and forth to work, or to eat, or to shop.”
Mayock: “And do you actually own the properties, develop them, manage them?”
Griffith: “Yeah, they're all owned and operated by InTown Suites. We don't have any kind of franchise system at all.”
Mayock: “So, I noticed in the past it seemed that you really look to go for the conversion route as opposed to the new build. I was wondering if you could comment on that and maybe talk about what kind of properties you target for conversion.”
Griffith: “We really went away from new builds a few years back when the construction costs were so expensive. We found that we really couldn't make the numbers work with a new construction, and there were also a lot of available acquisition properties that we could take advantage of, and that's what we are going after is purpose-built, extended stays that can be converted to an InTown.”
Mayock: “Right now there's quite a few distressed properties on the market right now. Are you eyeing any of those?”
Griffith: “Well, we're sure watching them and trying to anticipate which ones might come on the market. Right now I still think the pricing is a little bit of a gap there where what people really want to get for their properties or what they need to get for their properties versus what they're really worth at this point. So I think there's still a disconnect there and of course the availability of financing is always a concern right now.”
Mayock: “Let's shift our focus toward 2010. A lot of people are saying it's still going to be a challenging year, a lot of people are a bit more optimistic and think the industry is really going to bounce back. Where do you fall in that spectrum?”
Griffith: “Well, I still think it's going to be a challenging year. I think that InTown Suites is going to come out of it, but I think it's going to be a really challenging year for a couple reasons. Our daily battle is 138 locations in 21 states, and they're all individual situations. And in a number of markets now we're really coming back, but then in a lot of different locations we've got local competitors that are continuing to lower their price, which directly impacts us, and we've got other transient chains or properties that are trying to go after the weekly business, which again impacts us. So it's kind of a daily battle in 138 different places, and so I think 2010 is still going to be challenging. But I think it's going to be a turnaround situation for InTown.”
Mayock: “We mentioned some of the challenges in 2010. Tell me what do you think is the greatest opportunity for InTown Suites this coming year.”
Griffith: “Well I think we could benefit from the good times and the bad times. As the more construction projects, the stimulus money gets released and actually gets put to use, we're going to be able to take advantage of those types of situations as constructions starts opening up again. And still when people are in hard times, they trade down and we of course are right there in a great niche to take advantage of those folks too.”
Mayock: “OK. Is there anything else you wanted to cover or highlight, something I might have missed?”
Griffith: “I think that about states it.”
Mayock: “All right Scott, I thank you so much for joining us.”
Griffith: “Thank you.”
Mayock: “I really appreciate it.”