Nashua, NH The New England Real Estate Journal (NEREJ) held their Hotel Summit on September 5th at the Event Center at Courtyard by Marriott Nashua, 2200 Southwood Dr. Over 100 people were in attendance.
From 8:45 – 9 a.m., keynote speaker Stephen Bazarian of Dalton & Finegold spoke about premises liability in the hotel industry. He spoke in depth about liability cases hotels face, and what an owner can do to make sure their hotel is prepared. One of the most prominent cases made against hotels are slip and fall cases.
“Between 2006 and 2017, fall death rates in older adults increased 30%. If that rate continues there will be seven fall deaths every hour in older adults by the year 2030.”
There are an astonishing number of different kinds of cases that hotels face in premises liability. He discussed the typical slip and fall cases including those in hallways, stairways, gift shops, restaurants, outside walkways and parking lots. However, there are also accidents that are unique to the hotel industry.
Bazarian said, “Hotels and resorts have enormous exposure for premises liability actions.” He highlighted ways to make sure hotel owners are prepared and their employees are also prepared. Every hotel should make sure there are incident reports and owners should educate their employees on how: To fill out the report; get the appropriate contact information; take pictures of where the accident occurred; and report all accidents to the insurer.
The first panel was held from 9 – 10 a.m. and was moderated by David Roedel of the Roedel Companies. Speakers included: Kenneth MacKenzie of Dalton & Finegold; Jordan Warshaw of The Noannet Group; Tina Paulsen of Newburyport Bank; and Harry Wheeler of Group One Partners. Topics included financing, construction trends and architecture.
Roedel started the discussion asking the panel how commercial lending for hotel space is going. Paulsen began by saying banks are looking at the borrower and their reputation, rather than their brand, in order to get approved for loans. “In commercial lending in general, one of the most important things is knowing your borrower, so knowing your customer and their track history is number one for us,” she said.
Roedel asked MacKenzie to share his thoughts on a new client looking for hotel space, that doesn’t have as much experience, and what they should do. He said, “Find a good third party management company. We have a number of them in this region, and if the person in question has located a good site, and if that person has a letter of intent etc…That would cause me, on behalf of the client, to have a better comfort level when they are getting involved with hotels for the first time.”
Warshaw said, “The state of financing for us is a bit different. There is quite a lot of capital out there right now that is interested in hotel that is not typical bank capital. We wound up doing both of our recent deals with private capital. Essentially what you are doing is paying extra to get the flexibility to do a deal that, from my standpoint, has a little bit more downside protection.”
The next topic discussed was construction trends. Wheeler noted that client’s are changing their vision so now they are more focused on a boutique lifestyle with a live-work-play feel. “We are seeing a lot of smaller hotel rooms, going down to 200-250 s/f being acceptable. We are seeing a lot more flexibility and a lot more client-driven design, as far as technology and touch points etc…”
With construction costs on the rise, there was concern on doing value engineering on projects. Wheeler remarked how they are spending more time in the beginning of a project with schematics and design/development. It’s important to customize your design and make it authentic to the area.
The second panel was held from 10-11 a.m. and was moderated by Robert McCarthy of Melan Hotel Group. Speakers included: JP Ford of Hotel Development Lodging Econometrics; David Shamoian of Bravo Zulu Hospitality Group; Karen Whitman of Hilton Hotels; and Beej Das of Troca Hotels.
McCarthy opened the panel by asking Whitman what brands is she seeing develop the most in secondary markets. “Hilton currently has 17 brands, and we are seeing a lot of development in the select service. Hampton is our largest brand, and we are in most markets. We’ve seen a huge increase in our Home2 with almost 400 projects. Tru is also expanding rapidly, with over 100 hotels in the next few weeks.”
McCarthy questioned if a hotel can survive in a secondary market. Shamoian said, “We think there is a great opportunity in secondary markets with unique locations.” He gave his current project, The Hotel Concord in Concord, N.H., as an example of this. It is in an existing office building that was created into a hotel and mixed-used development. “I think that there is good viability in secondary markets for independent brands.”
Ford discussed how his firm helps developers when they are starting projects in regards to if it is the right location, financing and the supply and demand characteristics of the market. His company produces market trend reports to help.
“We produce market trend reports for any market throughout the world. It’s a complete breakdown of new supply in that market, whether it is primary, secondary, tertiary. You will know the current projects that are under construction in that market, what projects are scheduled to start construction in the next 12 months, and what projects are in early planning,” Ford said.
According to Ford’s statistics, the hot secondary markets in New England right now include:
• New Haven, Conn.
• Portland, Maine
• Manchester, N.H.
• Portsmouth, N.H.
• Burlington, VT; and
• Providence, R.I.
The last topic discussed was amenities, and how much attention goes into that in hotels. Shamoian noted that they pay a lot of attention to it, and he discussed how technology is very important now. “It could be iPad’s in guest rooms, or Amazon Echo Dot’s, instead of alarm clocks. You can order room service, you can ask for more towels or a late check-out.”
Das also agreed with the importance of amenities, and how many hotels are moving to dispensers, to help save money and offer better products. He also mentioned his hotel brand is cannabis-friendly.
Overall, the panel was very optimistic about the hotel industry in the New England region.
The New England Real Estate Journal would like to thank the following sponsors for this event:
Corporate Sponsors: Group One Partners; Commercial Modular Construction, LLC; NOREL Service Co., Inc.; and Dalton & Finegold, L.L.P.
Vendor Sponsor: U.S. Pavement Services, Inc.
For more information or speaking/sponsor opportunities at future summits, please contact Rick Kaplan at [email protected] or call 781-878-4540.
Jennifer Tempesta is an editor for the New England Real Estate Journal, Norwell, Mass.