Hotel Industry

Stephen F. Bollenbach and Jack Pechter are looking at the hotel business a bit differently these days.Mr. Bollenbach, chief executive of Host Marriott Corp. of Bethesda, plans to spend one or two billion dollars buying depressed hotels. Mr. Pechter closed his Quality Inn in Towson in October to make way for a shopping center, saying the 33-year-old motel wasn't worth the money it would cost to renovate.It's a strange time for hotels. As the industry snaps out of a recession that hit it harder than nearly any other part of the economy, there's enough good news to bring dealmakers like Mr. Bollenbach out of the foxholes and grabbing his checkbook.

To attract more conventions to Baltimore, city tourism officials must work more efficiently with the convention center and the hotel industry to streamline bookings, address the city's crime problem and better market its attractions, according to a study released yesterday. "If you can get the team to pull together all in the same direction, you're going to get better results," said David R. Evans, a Seattle-based analyst and one of the study's authors. "There should probably be one governance body over them, and that's going to help a great deal."

Marriott International Inc. yesterday reported that its earnings soared 24 percent to $247 million in 1995, the best performance in its nearly 70-year history.The Bethesda-based lodging operator's record net income -- equal to $1.87 a share -- also represents the latest evidence of the hotel industry's dramatic rebound. The company said it posted healthy gains in its full-service, Courtyard, Fairfield and Residence lodging lines, along with its services businesses."We continue to benefit from the power of our brands, a strong business environment and improved operating efficiencies across all our product lines," said J. W. Marriott Jr., the company's chairman and chief executive.

The privately held Hyatt hotel chain, the pearl of the Pritzker family empire, is being groomed to go public or to grow by acquisition as early as next year, according to a confidential company document obtained by the Chicago Tribune. Such moves would cap a process launched in March last year when the Chicago-based business announced a restructuring that brought domestic and international operations under one umbrella. The "Global Hyatt" initiative was aimed at improving the quality and consistency of Hyatt products and preparing for growth, though the company said at the time that it had no near-term plans for an initial public offering of stock.

Marriott International Inc. continued to take advantage of the hotel industry's positive momentum in the first quarter, posting a 21 percent gain in net earnings.The Bethesda-based lodging, resort and senior living community operator generated net income of $63 million, or 47 cents per share, with increases in virtually every segment of its business.The earnings increase came amid revenue growth of 7 percent to $2.2 billion in the period that ended March 22, as compared with the same period a year ago."

The developer of a waterfront tract east of the Inner Harbor has begun work on a $21 million Courtyard by Marriott, a long-stalled project that represents the ninth lodging project pending in the effort to add hotel rooms downtown.H&S Properties Development Co.'s planned 207-room hotel will be part of a $55 million project that includes parking, office space and a Fresh Fields gourmet grocery store. It is expected to be completed by mid-2000."This segment of the hotel industry is very under-served in Baltimore," said Michael Beatty, an H&S Properties vice president.

Marriott International Inc. reported yesterday that its earnings in the second quarter rose to the highest level in the company's 41-year history, thanks to gains in room rates and additions to its portfolio.The Bethesda-based company's net income of $101 million, 37 cents per share, was 20 percent higher than in the comparable period a year ago, further evidence of the strong U.S. economy and the hotel industry's continued strength. Marriott's total sales in the three months that ended June 19 also increased significantly, to $2.5 billion, a 16 percent gain from the corresponding period in 1997.

Host Marriott Corp. continued to reap the benefits of the hotel industry's surge in its third quarter, generating a nearly 50 percent gain in earnings over the same period a year ago.The Bethesda-based lodging company reported earnings before interest expenses, taxes and non-cash charges of $151 million in the quarter ended Sept. 12, results fueled primarily by its upscale Marriott and Ritz-Carlton projects. Revenue in the quarter rose 47 percent, to $246 million."The strong supply and demand fundamentals in these segments, combined with our high quality portfolio concentrated in urban locations and convention/resort markets continue to fuel our growth," said Terence C. Golden, company president and chief executive.

In April, Baltimoreans United for Leadership Development announced its determination to forge a "social compact" that would link public subsidies to improved job opportunities for blacks. As its first target, the coalition selected the city's hotels."The most celebrated example of public subsidy in Baltimore -- recipient of a 30-year stream of well over two billion city, state and federal dollars -- is the downtown complex of hotels, entertainment, retail and office facilities," BUILD said.

Host Marriott Corp., basking in the glow of the hotel industry's resurgence, yesterday reported its earnings before interest, taxes and noncash charges rocketed 32 percent to $107 million in the second quarter.The Bethesda-based hotel owner attributed the improved earnings to gains in operating results vs. the same period in 1995, as well as a buying campaign that has added 11 upscale properties valued at $825 million to the company's portfolio this year."We are seeing strong year-to-year improvements in operating results from comparable hotels," said Terence C. Golden, Host Marriott's president and chief executive, in a prepared statement.

Business travelers have been the backbone of the hotel industry for so long that it became easy to take them for granted, assuming they'd always be there. Not anymore. With occupancy rates dropping from 63 percent in 2000 to 59.1 percent, according to the American Hotel & Lodging Association's 2003 Lodging Industry Profile, hotels have a lot of unanticipated empty beds to fill. Now the business traveler is being wooed, pursued and flattered through incentive and frequent guest programs, discounted corporate rates and various packaging and bundling schemes.

What good is the key to your hotel room if you can't find your hotel? Two words aim to solve this potential problem: key packets. About 20 to 30 hotels nationwide, primarily in Denver and Chicago, have begun giving guests miniature packets that hold swipe-style key cards while doubling as pullout city maps. "The packets are great," says Jason Pohlonski, assistant general manager for the Hotel Burnham in Chicago. "They're convenient for guests since they fit right in their pockets." Three years ago, Darren Gorman, national sales manager for Vista Publications, a printing company, began marketing the idea of giving bank customers maps showing ATM locations while having a sleeve to hold a debit card.

NEW YORK - True, economic troubles may be at hand. But it does not really matter quite so much when your hotel caters to clients who pay $10,000 a night and who tip a waiter more than most people pay to spend a night in a typical Manhattan hotel. Manhattan luxury hotels like the Four Seasons, the New York Palace and the St. Regis have had their share of problems since the World Trade Center attack. But the economics are a bit different: The distress here may mean changing the fresh flowers only once a day and replacing the Italian curtains less frequently, minor adjustments compared with what is happening at most Manhattan hotels.

Maryland's unemployment rate crept downward in May for the second straight month, as more residents found jobs in construction, agriculture and the hotel and restaurant industries, according to data released yesterday. But 25,000 more Marylanders were looking for work in May than a year earlier - evidence, economists said, that the state is still shaking off the recession-like symptoms that have been felt throughout the state and national economies. "Maryland is continuing to struggle with jobs, just like the nation as a whole," said Charles W. McMillion, chief economist for MBG Information Services in Washington.

A layer of drywall dust coats much of the interior of the Baltimore Marriott Waterfront Hotel, about three months shy of opening in Inner Harbor East. Carpets are still rolled in plastic and the escalators don't operate. But Mike Waterman, director of marketing, insisted during a tour yesterday that Baltimore's newest and largest convention hotel will be ready on schedule in February. Just to be safe, the hotel sales staff has not booked any groups before April. "I don't own a good pair of shoes anymore," said a construction-weary Waterman.

Marriott International Inc., one of the world's largest hotel operators, said yesterday that its earnings rose 10.5 percent in the second quarter as the booming economy spurred consumers to spend more on travel. Bethesda-based Marriott reported earnings of $126 million, or 50 cents a share, up from $114 million, or 42 cents a share, a year earlier. In the quarter ending June 16, Marriott's sales in lodging, distribution and senior living services rose 17 percent, to $2.39 billion from $2.04 billion.

Manor Care Inc.'s profits rose 15 percent in its second quarter, spurred by expansion programs and the improving health of the hotel industry.Net income totaled $28.8 million, or 46 cents a share in the quarter that ended Nov. 30, the Silver Spring health-care and lodging company reported yesterday. Revenue totaled $394.9 million, an increase of 21.8 percent.Manor Care also announced a third-quarter cash dividend of 2.2 cents, which will be paid Feb. 27."Another good, strong performance by one of the better companies in the entire industry," said D. Scott Mackesy of Dean Witter Reynolds Inc. "Continued good operations in both lodging and health care."

Marriott International Inc. said yesterday its profits jumped 24 percent during the 12 weeks that ended Sept. 8, the third quarter of the Bethesda hotel management giant's fiscal year.The company said it was helped by a strong economy that also has helped other hotel chains."All of our lodging brands are benefiting from favorable conditions in the U.S. hotel industry," company Chairman J. W. Marriott Jr. said. The company said it expects to continue strong earnings gains into 1996.Through July, the U.S. hotel industry had filled 66.3 percent of its available room nights this year, compared with 65.2 percent for the same period last year, said Randy Smith, president of Smith Travel Research Inc. in Hendersonville, Tenn.

A nationwide hotel building boom has raised concerns about a glut of guest rooms in certain markets and slower revenue growth in the years ahead. Construction began on nearly 149,000 hotel rooms last year - a level comparable to the industry building boom of the late 1980s. The current rate of building, which is far above historical levels, has contributed to a decline in occupancy rates and slower revenue growth only a few years after the industry staged a dramatic recovery. The average occupancy rate dropped to 70.4 percent in 1999 from 71.5 percent in 1998, and from a peak of 72.7 percent in 1997, according to statistics from PKF Consulting.