ATLANTA—Day two at the 31st Annual Hunter Hotel Conference brought about many of the same topics the industry has been concerned with for a while now, including the labor shortage, how technology can positively impact the industry and the growing middle class.
On the industry’s outlook, Jan D. Freitag, SVP of lodging insights, STR; and Mark Woodworth, senior managing director, CBRE Hotels’ Americas Research, noted the following:
- What could end the current cycle? The economy, overbuilding, unpredictable demand shock, oil/energy price increases and an asset price bubble.
- The economic outlook remains favorable well into 2020.
- “We feel really good that we’re not going to overbuild in this cycle,” Freitag said.
- The industry has had nine years of RevPAR growth.
- There’s very strong demand growth for select-service.
- Occupancy is still positive nine years into the cycle.
- Wage growth for non-supervisor employees is up 5%.
- There are a million open positions in accommodations/food services.
The executive panel—which included Kirk Kinsell, principal, Panther Ridge Partners LLC; Robert Burg, president & COO, Aimbridge Hospitality; Elie Maalouf, CEO, Americas, InterContinental Hotels Group (IHG); John Murray, president/CEO, Hospitality Properties Trust; and Pat Pacious, president/CEO, Choice Hotels—covered various industry topics.
Some of the key takeaways include the following points:
- Travel among the middle class is expected to increase over the years. People need to sleep, eat and drink. “The middle class is where the opportunity is,” Maalouf said.
- To retain talent, have “good hotels,” Murray said. Employees want to work at properties being taken care of. Also, create opportunities for employee career growth.
- Supply growth in the industry is real. “As an owner, supply growth is more important to me than Airbnb,” Murray said.
- Is the industry going to shut down OTAs? According to Burg, no, but the industry can do a better job of managing those channels.
- “Technology is going to help drive down the costs of running a hotel,” Pacious said.
- Which type of technology, specifically? AI.
- On attracting guests to properties: “We have to meet the consumers where they are,” Choice’s CEO said.
Thomas J. Baltimore Jr., chairman of the board, president and CEO, Park Hotels & Resorts, accepted the 10th Annual Hunter Conference Award for Excellence and Inspiration, and made the following points:
- Will there be a recession in 2019 or 2020? He doesn’t believe so. “I really think there’s more running room in this cycle,” he said.
- Brands matter. “I’m a big believer in the brands,” Baltimore said. Consider what they’ve done: brand segmentation, global sales, and worldwide reservation systems.
- The industry will survive, no matter what. While some may worry over the future of the industry, it helps to have perspective. The industry has survived several disrupters, including OTAs, video conferencing and home-sharing.
- Industry challenges include labor costs, property taxes and insurance.
Stay tuned for more conference coverage in the 4/7 issue of Hotel Business.