February 9, 2010

Starwood Relocation Hits ‘Illegal’ Snag

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The planned relocation of Starwood Hotels & Resorts Worldwide Inc. from White Plains, New York, to Stamford, Connecticut, will proceed, despite a potential infrastructure funding roadblock.

The Wall Street Journal reports that the US$35 million in infrastructure improvements that Connecticut promised to Starwood as part of a deal to facilitate the move may actually be illegal. Connecticut planned to use federal stimulus money to pay for the improvements, but those funds may not be used in a way that would directly benefit one state over another.

The newspaper quotes Elizabeth Oxhorn, White House spokeswoman for the American Reinvestment and Recovery Act, which funded the stimulus, as saying: “[Transportation] grants will not be awarded to fund a relocation of the Starwood headquarters… Recovery dollars can’t be used to fund corporate relocations.”

However, Starwood spokeswoman Nadeen Ayala says the relocation will go ahead regardless of whether the designated infrastructure improvements are made.

“Starwood Hotels’ relocation to Connecticut is contingent on a US$90 million economic incentive package, but not the state’s roughly US$35 million in planned transportation infrastructure improvements,” Ayala says. “This [Wall Street Journal] article incorrectly said Starwood would not move to Stamford, Connecticut, if the infrastructure improvements were not made.”

 

February 8, 2010

Dolce Extends ‘Make Us An Offer’ Promotion For Meeting Planners

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In response to popular demand, Dolce Hotels and Resorts has extended until March 15 its “Make Us an Offer … Anything Goes” promotion that invites meeting planners to name the price they would pay for meetings and group events at any of its 26 upscale hotels, resorts and conference hotels in North America and Europe.

To participate, meeting planners in the United States and Canada should call Dolce toll-free at (800) 57-DOLCE – (800) 573-6523 – or use the online request-for-proposal tool at www.dolce.com or call the Dolce hotel of their choice directly and mention the promotion code “ANY.”  Bids are welcomed through March 15 for meetings to be held through May 31, 2010.

Dolce’s entire global portfolio is participating in “Make Us an Offer … Anything Goes” including its newest properties: The Thayer Hotel, West Point, N.Y.; Seaview, a Dolce Resort, near Atlantic City, N.J.; and the Dolce Munich Unterschleissheim, scheduled to open this April near Munich, Germany.

Planners should be prepared to provide requested dates, their destination, food and beverage needs and other meeting services and state the price they would be willing to pay for the package.  They may request Dolce’s Complete Meeting Package with or without food, day meetings with or without food, Modified Meeting Plan with or without food or European Plan.

If the bid is too low, Dolce will propose a counteroffer spelling out exactly what the property can provide for the offered price as well as the cost for holding that meeting exactly as specified.  If the property is not available on the requested date, the staff will suggest alternative dates and suggest other Dolce properties that may be available.

 

February 8, 2010

Incentive Travel Cutbacks Expected To Continue In 2010

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A new survey from the Incentive Research Foundation and Corporate Meetings & Incentives magazine shows that incentive cutbacks create an immediate negative effect on sales and morale — and, over years, can cause companies to lose their top performers.

Thirty-two percent of the survey’s 109 respondents reported a negative impact on morale from the “lowered quality” of their companies’ 2009 incentives, and approximately 20 percent reported a negative impact on sales and retention. Significantly more respondents (30 percent vs. 20 percent last year) expect a negative impact on retention from 2010 cuts.

“It appears that incentive cutbacks have a cumulative effect over time and could end up driving away companies’ best people,” said CM&I editor Barbara Scofidio.

The majority of companies responding to the survey lowered their 2009 incentive budgets: 65 percent said their budgets were slightly to significantly less than in 2008, and 20 percent said their budgets were significantly less (down more than 25 percent). Of all types of incentives (cash, merchandise, gift cards, individual travel, and group travel), group travel — the target of endless bad press in 2009 — was the hardest hit, with 37 percent of responding companies canceling their 2009 incentive trips altogether.

Planners dealt with these tighter budgets by cutting back on their incentive trips: eliminating on-site gifts (59 percent), shortening the stay (41 percent), sending fewer managers on the trips (41 percent), and inviting fewer qualifiers (34 percent). As a result, the survey found that at least one-quarter of attendees were unhappy: 13 percent with program inclusions, 9 percent with the destination choice, and 3 percent with the property, according to respondents.

The cumulative effect of cutting back on incentive travel is expected to continue in 2010. According to the survey, 91 percent of 2010 incentive programs will have budgets that are either the same or less than in 2009 (and 2009 budgets were already coming in at an average of 20 percent less than 2008 levels).

The survey was a joint project between IRF and Penton Media, the publisher of CM&I. The 109 respondents comprised incentive decision-makers within corporations, from meeting managers to directors of sales and marketing; there were no incentive suppliers or consulting firms participating.

 

February 4, 2010

Omni To Launch Luxury Brand

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The new luxury boutique hotel brand from Omni Hotels will be loosely based on The Watermark Hotel & Spa in San Antonio, which will be the first property to fly the new Mokara brand flag.

The new Mokara Hotels & Spas brand, which will officially launch April 1, will have a focus on wellness and will be positioned to compete with other luxury brands like Shangri-La and Mandarin Oriental, according to Mike Garcia, Omni’s senior vice president for development.

At least initially, Mokara will be led by the same executive management team as Omni Hotels & Resorts and will operate for corporate organizational purposes as a sub-brand of Omni. Mokara properties will be primarily owned and managed by Omni, although the company is open to third-party management opportunities.

While Mokara is not specifically a conversion brand, those will be the bulk of deals going forward, Garcia says. “The opportunity is conversion of current properties,” he says. “As you look down the road, we would certainly consider new-builds. But the environment we’re looking at is that there are assets out there for conversion.”

Garcia offers no timetable for expansion, but says there are about 25 hotels under consideration for the Mokara brand. Urban and resort markets in North America are the target locations for Mokara, as are some potential resort sites in South America.

Omni executives have long believed that The Watermark Hotel holds potential as a brand, and future Mokara properties will be broadly modeled on the iconic property. However, like the flagship Omni brand, Mokara properties will not share a uniform design template but instead will reflect regional style and influences.

Omni does not own the copyright on The Watermark name, necessitating a different brand moniker. Omni settled on the Mokara name because, as the company’s existing spa brand, it creates a link to Omni while also evoking a sense of wellness rejuvenation, which is at the core of the brand concept. Mokara is a type of orchid, the flower that also happens to be the Omni Hotels logo.

The target demographic for Mokara are adults aged 35 to 54 with a household income of more than US$100,000. Mokara will be marketed at executive-level business travelers looking to relax, as well as affluent couples interested in a weekend retreat. Mokara will not generally be positioned as a family-friendly brand.

Mokara concierges will be tasked with contacting all guests prior to arrival to learn about the reasons for the impending trip and will appoint guestroom amenities accordingly.

From a food and beverage standpoint, all Mokara properties will feature signature destination restaurants that will rely heavily on local covers.

 

February 4, 2010

Overinflated Hotel Prices Help To Sink San Diego Hotel Sales

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Sales of hotel properties in the county plummeted by more than 57 percent last year, the consequence of significant declines in spending by business and leisure travelers and widespread financial distress among hoteliers.

A year-end report released this week by Irvine-based Atlas Hospitality Group revealed that statewide, hotel sales fell 51 percent, in part, because hotel prices were overinflated by owners unwilling to acknowledge slumping values.

In San Diego County, there were just six hotel sales valued at $50.4 million last year, compared with 14 a year earlier, totaling nearly $145 million, Atlas reported. The median price per room paid by buyers was $64,929, down nearly 28 percent from 2008.

The largest, most expensive transaction in the county was the $28.5 million paid for the 145-room Homewood Suites in Carlsbad. The largest sale in the state was the 404-room W in San Francisco. At $90 million, it accounted for more than 17 percent of the entire California dollar volume in 2009.

Other San Diego County hotels that changed hands included:

• The 94-room Hampton Inn in Carlsbad, at $15.8 million

• The 64-room Gaslamp Plaza Suites, which did not disclose the sales price

• The 46-room Pacific Coast Inn and Suites on Mission Bay Drive, at $4.65 million

• The 35-room St. Francis Motel in El Cajon, at $1.8 million

• The 41-room Travel Inn Motel in Carlsbad, at $2.85 million

 

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