Do you want the good news or bad news first? Well, both aren’t that great. STR released its October performance numbers and the industry posted declines in the three categories that matter most: occupancy was down 6.2 percent to 58.1 percent, ADR fell 8.2 percent to $99.08 and RevPAR dropped 13.8 percent to finish at $57.57.
The less bad news, if you will, is that the declines are less than those over the past three months or those year to date (check out the charts from STR). So we’re still falling, just not as fast. Mark Lomanno, STR president, said “It appears it will take a few more months of better demand results before any pricing rebound occurs.”
The economy may be headed from recession to recovery, but it’s not going to happen overnight, especially not for the hotel industry. A recent story in the NY Times suggested recovery was still a long way off and Lalia Rach, the dean of the hospitality program at the Tisch Center, cautioned that lowered quality and customer service as a result of staff cuts would make a quick rise in rates impossible.
Another story from STR suggests travel and hotel performance could improve this holiday weekend compared to a year ago, but still below 2007 levels. Any improvement would give the industry something to be thankful for.

The lodging industry typically doesn’t spend a lot of time considering its past. Some may find that odd since compared to many other businesses (computers, automobiles, aircraft), the hotel business is one of the oldest, if not the oldest, in the history of man. That changed recently with the publication of two great books that look at the history of the hotel business from different perspectives.
The more interesting of the two is “Great American Hoteliers: Pioneers of the Hotel Industry,” a fascinating and entertaining series of profiles of 16 men who author Stanley Turkel argues were the builders of the modern American hotel industry. That’s significant because due to the efforts of these titans (and others, of course), the American style of hotelkeeping long surpassed the European tradition that reigned for centuries.
Some of the profiles cover names (Hilton, Marriott, Johnson, Wilson) familiar to even casual students of hotel or U.S. history. Sadly, just one of the pioneers covered in the book (John Q. Hammons) is still alive and active in the industry. To me, the more interesting tales cover hoteliers about whom I knew little before reading the book but now have a greater appreciation for their contributions.
Most compelling story focuses on Kanjibhai Manchhubhai Patel, who Turkel’s identifies as the first Indian-American hotelier. K.M. Patel arrived in San Francisco in 1923 and soon began operating a small residential hotel in the city. The rest, as they say, is history: Today Indian-American hoteliers dominate the industry with their trade association, AAHOA, recently surpassing 10,000 members. As Turkel says, this community represents a true American success story.
To order the book, go to www.greatamericanhoteliers.com. I heartily recommend it.
The other publication of note is more official but also interesting. To honor the start of its 100th year of operation, the American Hotel & Lodging Association produced “A Century of Hospitality,” a look back at the last 10 decades of the hotel business and the association. Masterfully edited by Len Vermillion, Marla Cimini and Phil Hayward, the book presents an easy-to-read, yet informative walk through the major events that shaped our industry.
Go to the AH&LA website to order the book.

It’s about time Marriott wised up and brought Ritz-Carlton under its big tent. This week, the firm quietly announced a reorganization plan that splits the company into four global divisions with all brands and operations, except timeshare but including Ritz-Carlton, reporting to those divisional teams.
When Marriott bought controlling interest in the luxury Ritz chain in 2000, the chain’s godfather and former president, Horst Schulze, extracted a promise from Marriott that it wouldn’t tamper with the well-honed luxury culture of the brand. Since the time of the sale, Ritz-Carlton has operated mostly separate from the Marriott infrastructure lest, as Schulze feared, it become contaminated with the mass-market style of hotelkeeping for which Marriott is so well known and universally envied by competitors.
The fact is neither Schulze nor the executives who followed him, including the affable Simon Cooper, have a monopoly on top-notch service or good taste. Marriott and many of its franchised owners operate some of the best hotels in the world. And while Marriott takes a back seat to no one when it comes to efficient and guest-pleasing operations, where it really shines is sales and marketing. No chain, management company or individual operator knows how to find, attract and keep customers like Marriott can. It’s no accident Marriott Rewards is the dominant guest loyalty program in the hotel industry.
And while in making the announcement, Marriott President Arne Sorenson talked about the cost savings the reorganization will yield, the real plus for Ritz is that it now will enjoy the full effects of the unparalleled, take-no-prisoners marketing muscle of the world’s premier hotel company.
But even though he has no say in the matter anymore, I’m sure somewhere Horst Schulze is cringing at this news. In fact, however, it should have happened years ago.

The former Secretary of State spoke at IHG’s annual leadership conference in D.C. last week and the frequent traveler said although he’s never filled out a comment card before, he had a few suggestions for the collection of hotel owners in attendance. In no order, these were the things he wanted:
- Shampoo and conditioner bottles without fine print, so he could clearly know which was which and avoid washing his hair with body lotion;
- An alarm clock that didn’t require “astronaut training” to use;
- More room in the closet; he said you have this big suite and then a smaller closet already stuffed with an ironing board, safe, extra pillows and more;
- Wireless in all public facilities; the retired general said he was too old to crawl under a desk to make wired connections.
Powell was a mix of inspirational and endearing; equal parts grandfatherly and military, talking a lot about his wife and family in addition to his storied career. I’m sure he’s made a similar speech hundreds—if not thousands—of times, but his research and knowledge of the audience was evident. He reminisced about his fondness for Holiday Inn, dating back to the 1960s when the brand was one of the first integrated hotels in the South.

The organizers of the International Hotel/Motel & Restaurant Show need to consider major changes to this once but no longer relevant event. If they don’t, the Show is doomed for extinction, perhaps soon. The recently concluded edition of the Show, which is held each November at the Javits Center, New York City’s poor excuse for a convention venue, was considerably smaller than in recent years, was poorly attended and generally failed to generate much enthusiasm. Perhaps you can blame the state of the economy, but truth is the Show has been on a downward spiral for a number of years.
I spoke to scores of exhibitors and attendees and nearly everyone complained about the lack of traffic in the aisles. The educational sessions delivered good content, but were mostly poorly attended. The only highlights of the week came during the meetings of the AH&LA, and even that group has its own, but unrelated problems.
Show management needs to get creative in its approaches to building exhibitor interest and industry attendance, especially by hotel owners and operators. Here’s one idea: Create a hotel franchise and management company pavilion, similar to the existing Technology Innovation Center, to allow brands and managers to meet with owners and developers to discuss new projects and deals. The exhibit space in the pavilion needs to be inexpensive enough to attract all the major, and many of the smaller, brand and management companies.
Whether it’s this idea or something else, the key to reviving the show is to get more attendees in the door. Do that, and everything else falls into place.

By most measures that matter, it seems as though extended stay is still the best segment in which to own a hotel. According to new research from The Highland Group, while the segment endured a 7.2-percent increase in supply in the third quarter, it posted a modest (1.7 percent) increase in demand, a milestone the overall hotel industry hasn’t achieved in more than a year.
And while extended stay rates declined more than 11 percent in the quarter, the segment still posted stronger RevPAR results than the rest of the industry. It’s no wonder developers love the product, and that’s been part of the segment’s problem lately. Nearly 7,300 extended stay rooms opened during the third quarter, and another bulge of room openings is forecast for the fourth quarter.
But good signs for the segment are on the horizon. The Highland Group says supply growth will slow significantly in 2010 and, combined with improving demand, the extended stay business should continue its long run as the star of the hotel class.