With roughly 3,100 attendees at this year’s ALIS conference (that stands for the Americas Lodging Investment Summit)—a record attendance for the annual event in Los Angeles since the heyday of 2008—it was clear the industry is faring well. How well though was the question at hand. Here are three takeaways from my three days there.
1. It seemed most people were optimistically cautious about the year ahead—in part thanks to the uncertain political climate and the industry making what many are calling a “soft landing.” During the Standing by the Numbers panel, Jan Freitag, senior vice president of STR, shared that we are in our 82nd month of RevPAR growth; RevPAR grew 3.2 percent in the U.S. in 2016, and he predicted 2017 would see a 2.5 percent uptick for “slow but steady” growth. 2016 occupancy was slightly up (0.2 percent) to 66.7 percent, and last year the industry experienced record-setting occupancy numbers. But in 2017, supply may surpass demand, and occupancy may decline in 2017 and 2018. Currently, Freitag says there are 183,000 rooms under construction, up 30 percent—in comparison, at the end of 2007, 211,000 rooms were under construction. “Some lending is being curtailed, and [there is] some more discipline in choosing which projects to fund,” Freitag says, adding that two-thirds of those rooms are in the upscale and upper midscale segment. “Everyone wants to be in that limited-service market.”
He also shared some new Airbnb research: Looking at seven U.S. markets, 17.3 percent of Airbnb guests stay for 1 to 6 days; 29.2 percent stay for 7 to 29 days, and more than half, 53 percent, stay for 30-plus days, pointing at a slightly different guest than the typical hotel traveler.
2. Big brands and small brands are growing. Wyndham added 65,000 rooms (60,000 organic) and is expected to add just as many in 2017 (that’s something like two hotels opening every day, seven days a week); Marriott had a record year with 880 new hotel deals and some 400 new hotel openings (the majority outside the U.S., a first for the company); Two Roads Hospitality announced three Thompson hotels in Texas (a new market for the brand) while the first Joie De Vivre property will open in New York soon; Generator hostels is making its U.S. debut in Miami later this year; Hilton has 30 Canopy properties in development, with the Old Wharf in DC set for an October opening, while Waldorf Astoria and Conrad are experiencing their own boon (the New York property’s design plans will be unveiled soon, and the Beverly Hills property is debuting in June). Not surprisingly, authentic and experiential are still the industry’s buzzwords.
3. This year was light on brand announcements but two new initiatives came out of the event. Hilton launched soft collection Tapesty (the hotel company’s 14th brand), aimed at the 3-Star upscale independent experiences that don’t fit within the Curio Collection. Seven hotels have signed letters of intent to join the collection in Chicago; Nashville; Warren, New Jersey; Syracuse, New York; and two in Indianapolis. An additional 35 deals are in the works, with the first Tapestry property slated to open in the third quarter of 2017.
And in a pop-up innovation lab, Aloft and Element revealed their new designs, which include a new Element guestroom layout that features a communal living space that’s linked to four guestrooms for guests to cook, dine, and lounge. Aloft, meanwhile, is updating its F&B experience, with made-to-order food with fresh, healthy ingredients obtained via a seamless touchscreen experience, as well as its guestrooms (which I got to experience firsthand via VR) with tweaks to layouts and new color schemes. Element is also pushing the tech envelope, with portable wine carts that pour wine when activated by a guest’s keycard. Perhaps my most favorite invention.