My first real introduction to the lodging industry came last January at ALIS, with a record crowd of almost 3,000, flocks of black suits wheeling and dealing in every nook and cranny of the Hyatt Regency Century Plaza in Los Angeles. The lodging industry had peaked, and kept peaking, starting in 2005 through the end of '07. The law of averages, and gravity, I guess, dictate that what goes up, must come down. And that was the story of 2008.
Optimism reigned supreme at ALIS despite strong warning signs that the economy-and maybe the industry-was in trouble. The credit crisis was just a blip on the radar and only beginning to reach the commercial side when the Hunter Conference convened in March. The mood there was tempered and the new catchphrase, "cautious optimism," was gaining traction. That faded to mild optimism in September at the Lodging Conference. The pulse at the IH/M&R Show in November was different. Call it positive pessimism, but it definitely wasn't a sky-is-falling mentality yet.
Reality was starting to set in by the end of the calendar year. By then the question was when, and where, rock bottom would be. In early December, industry execs gathered in Chicago for an aptly named "Navigating Troubled Times in the Hotel Industry" seminar, where the news was not good. PKF had just revised its forecast for 2009, calling for a 7.8 percent drop in RevPAR, and many thought it would be worse. Everyone agreed the lending environment was "non-existent" and no one had a clue when that might change.
Welcome to the hotel industry, I guess. What a first year. The news wasn't all bad, as several innovative brands, like aloft and Element, launched. Another will debut shortly, Hyatt's Andaz, and another, Edition, is on the horizon, born from the unlikely pairing of J.W. Marriott and Ian Schrager. Others unveiled a fresh look, like Holiday Inn, Courtyard and Sheraton. The names and faces changed too, with new CEOs and executives atop major companies, like Choice (Steve Joyce), Wyndham (Eric Danziger), Starwood (Matthew Avril), Carlson (Hubert Joly) and IHG (Jim Abrahamson), to name just a few. Sadly, the industry lost one of its strongest leaders when Steve Porter passed away in August.
I'll remember all that, and more. The next 12 months, at least, will be challenging, but it's clear to me, and many much smarter (thankfully for you), that the fundamentals of the lodging industry remain strong. People, especially Americans, will continue to travel, as Peter Yesawich likes to remind us. And those same Americans, as Laurence Geller confidently told the crowd at the doom-and-gloom event in Chicago, will get us out of this mess with their entrepreneurial and optimistic spirit.
Let's toast to that.