NEW YORK— Both public and private companies are well positioned to take advantage of the current hotel industry upswing, according to a group of executives representing each at a panel entitled “Strategic Advantage or Not: Public vs. Private” during the recently held NYU Hospitality Conference. While vastly different in make-up, public and private companies are adopting strategies to make the current industry environment work for them. Executives from both sides of the fence said they are optimistic about their future growth opportunities, noting varying strengths and weaknesses. “Private companies have an advantage in that they have more flexibility in terms of the types of deals they can go after,” said Timothy Haskins, executive vp and managing director, Tishman Hotel Corp. “Public companies are usually restricted to a pre-determined growth strategy that is hard to stray from while being watched by Wall Street.” However, public companies have easy access to capital, which can help in terms of setting up acquisitions. “The access to capital is the greatest benefit of being public,” said Michael Barnello, COO, LaSalle Hotel Properties. “If you are a public company, want to close on a deal quickly and you have a credit line available, you’re in,” agreed David Brooks, executive vp, Ashford Hospitality Trust. “But sometimes people come to us with deals that don’t fit our profile, and getting outside the box is definitely a bit tougher for us,” Barnello said. Private companies have the ability to put on the breaks if it looks like an industry downturn is approaching, which could eliminate headaches down the road, said panelists, whereas public companies have to meet certain growth expectations. “The public markets always get it wrong, overvaluing or undervaluing the hotel industry, which is something the public companies have to deal with,” said Clark Hanrattie, senior vp/CIO, HEI Hospitality. “Pubic companies have to define their strategies and then are confined to that. Private companies can be reactive to all types of deals and conditions.”
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