NYU Conference Kicks Off

NEW YORK— The 23rd Annual New York University International Hospitality Industry Investment Conference kicked off its third year at the Marriott Marquis here, with a welcome reception by six-year Conference Chairman Jonathan Tisch. Approximately 1,600 people were in attendance at this year’s conference, which is being held from June 3 to 5. Tisch previewed some of the more notable sessions that would be taking place over the next few days, including a panel discussion about the future of Cuban tourism. He also announced the 2001 Deal of the Year winner— Millennium Partners— for its six North American Ritz-Carlton mixed-use developments this year. In a panel featuring a number of hospitality CEOs, including those from Hyatt, Accor, Bass Plc, and Joie de Vivre Hospitality, technology seemed to strike a nerve. Georges Le Mener, president/CEO of Accor Lodging North America, was the only executive of the four to give out exactly how much his company has spent on technology. “In the last four years we’ve spent $60 million on technology in the United States.” One third of that went to the Internet and reservations, with two thirds going to back of the house operations, he said. Worldwide, Accor spent $250 million on technology over the last four years, he said. When asked what the return on investment was, Le Mener candidly admitted, “I wish I knew.” Meanwhile, during an informal Q&A session with leading industry executives, Chip Conley chairman/CEO of Joie de Vivre Hospitality, noted the boutique segment could be poised for expansion outside its traditional urban locations. “I think you’re going to see boutique hotels make it to the suburbs,” said Conley, noting, “A secondary market like Cleveland could use a ‘W’ style product.” He added that, “blanketing” regions with the unique style properties is not a likely occurrence. “The problem with recreating a ‘handcrafted’ product is that it really is an oxymoron,” said Conley. The future of the budget hotel industry was debated during a panel entitled Hotel Survivors: Economy Segment, during which panelists noted that continued growth may be more successful through conversions, rather than new construction. “Conversion is the name of the game to grow in the economy segment,” said Hasmukh Rama, chairman/CEO of JHM Hotels. Michael Leven, president/CEO of USFS, added that the industry should expect to see mature brands, like Super 8 and Days Inn, disposing of older and lower quality properties in order to stay competitive with new-construction budget chains, like Microtel. “The budget segment is under-demolished,” said Leven. In addition, Eric Pfeffer, chairman/CEO of Cendant’s Hotel division, stated that independent regional chains will begin feeling added pressure to convert to franchised brands in the future as amenities and operations improve at the larger chains. In a presentation entitled Looking From the Outside In: Economists Predictions, panelist Mary Farrell, managing director and investment strategist, UBS Warburg LLC, said that the lodging industry can look to the “gray wave” of baby boomers to keep driving the economy. For example, when asked what they would spend money on when the economy recovers, 46% indicated a vacation with 77% noting the money would go on a “nice hotel.” “Vacationing has taken hold as a way of life,” noted Farrell. During the One-Stop Shopping: Hotel Procurement session, the pros and cons of procurement systems were discussed. Panelists agreed procurement systems would help ensure brand equity and consistency, increase cost efficiencies, and reduce maverick buyers. However, before implementing a system, especially for franchisors or smaller to mid-sized companies, panelists said that those companies need to