In "European Vacation," Chevy Chase takes his family over the pond where high jinks and mayhem ensue. (The only thing I have in common with Chevy Chase, the actor, is that I grew up in Chevy Chase, Md.) Similar to the Griswolds, I, too, headed to Europe, in March, for two reasons: business and pleasure. But when your business is hotels, they are your pleasure just the same. Here’s how.
The first stop on my European jaunt was Berlin, and the International Hotel Investment Forum or IHIF. This was my first year attending the show and the real rock stars of the hotel industry turn up to the InterContinental Berlin, the host hotel for the conference. For a hotel junkie like me, riding in an elevator with the likes of Steve Joyce and Sébastien Bazin is a trip. To paraphrase George Costanza: “These are men with secretaries!” Getting to interview them is just the icing on the cake and I got to do that, too, along with other CEOs at the show, a recap of which you can find here.
High on Europe
To a man, they are bullish on the current state of the industry and optimistic about how the rest of the year will shake out. The overall theme: people are traveling, debt is available, transactions are booming, interest rates remain low, supply is still muted—what’s not to love? Arne Sorenson, CEO of Marriott International, went so far as to say that he wished he could bottle 2014 and pop it open every New Year. Which brings me to my point: How cool would it be to spend New Year’s Eve with Arne Sorenson?
While I write about Europe frequently, this was the first time I had been over there in some time, and the mood was buoyant. Why not? Investor confidence and improved operating fundamentals are spurring a heady hotel transactions environment. And expectations are that investment from Asia will lead the charge, reaching some $22.7 billion in 2015, forecasts CBRE. Asian hotel real estate acquisitions in Europe surged by 90 percent year-over-year in 2014 and by 20 percent globally.
IHIF proved successful in that while it’s a Europe-based conference, the overall tenor is global; hotel executives gather from all parts of the world and discussion runs the gamut from hotel operations and branding initiatives to the ramifications of foreign direct investment. Undoubtedly, this year’s IHIF theme, "The Meeting of Global Collaboration," has never ringed so true.
Love & Hate: Airbnb
Luckily, the ringing in my ears has subsided now that I’m back stateside. (That, my readers, is what you call a deft transition. You’ll understand the meaning in a second.) Post Berlin, it was time to experience a destination in Europe I never had before: Prague. And, guess what, reader…I took the Airbnb plunge. Now, before you sling arrows at me for abandoning the hotel industry, understand that it was purely a reconnaissance mission—to see what it's all about. Here’s the real threat to the hotel industry, as I see it: Once a traveler gets over the anxiety of booking Airbnb the first time, he or she might be hooked. Still, Airbnb is not for the faint of heart; you have to be somewhat intrepid to do it. Here’s why (and this applies to my experience only):
- There is no security—whatsoever. Once you open that front door, you are on your own. There’s no front desk to call if a concern arises.
- Lack of amenities. One towel. That’s all I got for three days. So make sure to bring your own linens—and shampoo.
- No community. One of the great things about staying at a hotel is congregating with new people. Airbnb is hyper-local lodging; meaning if you are traveling alone, you are really on your own.
All told, it’s incumbent on the hotel industry to enforce a level playing field. Airbnb is here to stay, but they must play by the same rules as hotels do.
Beyond Airbnb, there are other hotel cues I picked up on in Prague. For one, there are multitudes of independent hotels. While the U.S. is a brand-first country, Europe is an indy stronghold. Walking the streets, all I kept thinking was: What an opportunity for the soft brands! As an owner, if there is a way to increase my hotel's revenue, without compromising its independent spirit, hand me a pen, I’m ready to sign on the dotted line.
Oh, and that ringing in my ears? Try navigating Wenceslas Square without being solicited or propositioned by every walk of life. It’s a cacophony and assault on the senses rivaling Times Square—before the Giuliani days! Ah, Prague.