Rebound! Day 1 of 2012 Americas Lodging Investment Summit (ALIS) at LA LIVE, Los Angeles

It has been reported that the producers of the conference this year were torn between an exclamation point and question mark in the program title  As you can see, the optimistic decision was made to include an exclamation point.  As I explain below, I tend to agree with that decision.

Monday marked the opening of the 11th annual ALIS here in Los Angeles.  This year's attendance of 2400 makes the 2012 conference the third largest in its 11 year history.  From the many conversations I had throughout the day, the optimism expressed in pre-conference survey results was shared by many.

The first day included an opening presentation by Wells Fargo chief economist John Silvia.  According to John, five key economic fundamentals that he regularly follows (growth, profits, interest rates, inflation, and currency) lead him to believe that the United States will continue to enjoy sustained growth in 2012, though at rates lower than prior economic recoveries.

John's presentation was followed by very brief presentations by each of the industry's usual cast of economic forecasters - Smith Travel (Jan Freitag), HVS (Susan Mellen) and PKF (Mark Woodworth).  Here are the highlights:

1.  Smith Travel

  • World is recovering in majority of hotel markets
  • 2011 REVPAR was up 8.2%, driven largely by occupancy
  • 2012 forecast: 4.3% REVPAR growth driven by 3.8% ADR growth and .5% occupancy growth

2.  HVS

  • Hotel transactions in 2011 by dollar volume increased over 70%
  • 2011 average price per key exceeded $200,000
  • REITs accounted for 43% of transactions in 2011
  • Cap rates will continue to fall in 2012

3.  PKF

  •  2012 forecast: Occupancy 60.5% and 4.7% ADR growth
  • "Headwinds diminish and tailwinds develop"

Stay tuned for more details from ALIS later this week.

Highlights from the Oregon Restaurant and Lodging Association Annual Conference in Bend, OR (Sept 19 and 20)

This year's Oregon Restaurant and Lodging Association (ORLA) annual conference represents the culmination (and celebration) of months of hard work by the boards and members of both the former Oregon Lodging Association and the Oregon Restaurant Association to bring the two organizations together under a single common roof. While the number of restaurant members greatly exceed the number of lodging members, the newly combined organization has made a great effort to ensure that the interests of both constituencies are fairly represented. I applaud the efforts of Steve McCoid, Jeff Hampton and the other ORLA staff members and wish the newly combined organization continued success. Well done.  

As to the actual program, the highlight of the first day for the lodging members was likely Smith Travel's update and forecast of key Oregon lodging metrics. A few highlights:

  • Quite unexpectedly, transient lodging demand has staged a strong recovery (despite continued unemployment challenges)
  • Year-over-year improvement in occupancy was the story for most segments and regions in the Oregon market, but rate continues to be the challenge
  • Continued rate discounting on the transient side has led (and will continue to lead) to serious rate challenges in the group segment for the upcoming 16 - 18 months

Let me know if you would like a complete copy of Smith Travel's presentation.

 

The second day included great presentations on (i) green lodging trends (hats off to Steve Faulstick and the Westmont team at the Portland Doubletree and Jon Tullis and his team at the Timberline Lodge for the examples they've set in adopting sustainable (and expense-reducing) practices in their hotel's operations) and (ii) recent developments in federal law and their effect on Northwest hotel and restaurant owners (check this blog for future posts on these developments and AHLA's excellent summary). More information on sustainable tourism and the current marketing being done to promote sustainable tourism can be found at www.sustainabletourism.org.

 

While the mood in the conference hallways was somewhat subdued (largely because of continued uncertainty over the future of the Northwest eonomy), the conference proved once again the great value in attending these meetings and re-connecting with friends and clients. 

I look forward to seeing what the newly combined organization has planned next fall.