IRVING, TX— Look for “a gradual economic recovery to take hold as 2002 progresses,” said FelCor Lodging Trust EVP/CFO Richard O’Brien, with such a turn of events paving the way for improving operating performance for business in general and the hotel arena in particular. From his vantage point high within the ranks of one of the nation’s largest and more visible hotel real estate investment trusts, O’Brien waxed positive (with some reservations) about the lodging industry’s comparatively near-term future. “The industry has just gone through its largest RevPAR decline in three decades,” O’Brien pointed out, “so though we do believe things are slowly improving, we still have some very real concerns.” To that end, the FelCor executive noted that his organization’s business plan going forward necessarily shifted, with greater emphasis on moving and doing business “more cautiously.” But that doesn’t mean the current economic environment has stopped the REIT in its tracks. As O’Brien explained, even though the organization was holding down costs and re-examining its operations long before the tragic events of Sept. 11 made such reining in par for the course for most everyone in the industry, FelCor never stopped spending money where it was needed. “In terms of capital expenditures,” he said, “we poured about $600 million into our hotels between 1998 – 2001. “It’s all about positioning,” O’Brien maintained, “and, at this point, we’re well-positioned for whatever the future holds in store.” In charting at least one possible course for that future, he noted that he and his FelCor associates largely subscribe to the (hopeful) views of some REIT analysts and prognosticators who see a noticeable rebound in demand in 2003 and 2004, accompanied by a supply growth rate of only about 1% annually. In the realm of other fiscal matters, O’Brien contended: “FelCor has a growth mindset, aided and abetted by the financial discipline to buy at the appropriate time. But today is not that time…though we do see opportunities coming out of this currently difficult operating environment.” Finally, as for reinforcement of his belief of a slowly brightening economic picture, O’Brien alluded to the recent stock-price increases posted on Wall Street. “This upturn signals that even the stock market anticipates an improving future,” he said, and— as a public company— who is FelCor to argue with the will of the investing public.
Previous ArticleHeartland Systems, Hotel Software Systems Offer New Technology
Next Article Some Orlando Hotels Facing Loan Delinquencies