HNN recaps the top things to know from 2011 as part of its look back at 10 years of the hotel industry.
GLOBAL REPORT—With early signs of a rebound emerging in 2010, a newfound sense of confidence, along with the wealth of opportunities that crop up in the wake of a downturn, fueled a rebound for transactions in the hotel industry in 2011.
Deals activity spiked heading into 2011 compared to the nearly comatose pace of 2008, 2009 and 2010. The tone was set early in the year when Monty Bennett, then CEO of Ashford Hospitality Trust, told a crowd at the Americas Lodging Investment Summit how it was “a great time to be buying hotels.”
“What makes certain investments turn out to be fantastic and other investments not so good. … It all comes down to when you bought in the cycle. That is the driving factor. Now is the time to jump out there and buy,” he said.
Bennett took his own advice as Ashford invested $1.3 billion in a joint venture to buy the 28-hotel portfolio of Highland Hospitality.
Through just the first five months of the year, transactions volume hit $4.9 billion, tripling the volume seen during the same period in 2010. The publicly listed real estate investment trusts, however, did see a drastic decrease in their ability to make deals late in the year, when they collectively saw their stock prices take a hit.
It was a year of transition in many other regards as well, not the least of which was Arne Sorenson being elevated from COO to CEO at Marriott International.
But while there were several reasons for optimism in 2011—Sorenson in particular was open about his optimism, as was Hilton’s Chris Nassetta—hoteliers still had to be mindful of the fact that the industry had not yet fully recovered.
Some cautioned, amid fears of potential backsliding, to not start rolling back cost-cutting measures implemented during the recession years, but some delayed spending on things like renovations could not be pushed off forever.
The year also saw the emergence of several important trend lines within the hotel industry, including an increasing recognition of the importance of hotels in China and of the outbound Chinese traveler, the power of social media for marketing and guest outreach, and hoteliers opining on how to incorporate tools from tech companies like Google.
Read through these stories for more on how the hotel industry fared in 2011: