Patel - Chairman of AAHOA - Asian American Hotel
What are the specific opportunities for Asian Hotel
owners in today's economic situation? How can Hotel
owners survive and grow?
Although the current market situation is certainly
challenging, it also provides opportunities. In
an environment in which many properties are over-leveraged
and in which there is market overgrowth, those with
liquid cash will be able to purchase properties
for below market value. In addition, lenders are
learning that they do not have the knowledge or
infrastructure to operate hotels successfully themselves,
and therefore that foreclosure is not always value-maximizing.
|There is a need for hotelier expertise. During these
times it has been known that our members are better
operators than a corporation. They lend a personal
touch to the services they provide that is instrumental
to survival. Lenders are also learning that in many
cases it is better to negotiate the current loan.
In addition, people who are savvy can buy properties
at good values even though debt is not available
through distressed lender financing and owner financing
to help them minimize their losses.
|2) What are the
main challenges facing Hotel industry in general and
Asian Hotel owners in particular?
Based on recent surveys, economy travel, corporate travel,
and leisure travel are all down. Discretionary income
spending is down as well. New hotels that were built
in the last few years with the expectation that demand
would grow will struggle to maintain and increase their
occupancy rates. In order to face this challenge, owners
of these properties will need to embrace creative and
cost-justified marketing ideas to attract guests and
go the extra mile to ensure that they will return. There
are also legislative challenges to consider. The Employee
Free Choice Act is a business killer, and would wreck
havoc on an already-uncompetitive labor market. In addition,
the new ADAAA regulations which are set to go into effect
in January will impose significant additional costs
on hoteliers and all businesses.
3) How does AAHOA help members to face the challenges?
AAHOA helps members to face challenges in several ways.
a. Professional Development: Our industry is not going
to get a bail-out because hotels are owned individually.
This is why AAHOA’s CHO program is so important. By
stressing the importance of operating efficiently and
marketing effectively, this program provides our members
with the tools they need to enhance their existing skills
to stay afloat during these difficult times.
b. Advocacy: By cultivating relationships with elected
officials at the federal, state, and local levels, AAHOA
strives to influence meaningful change to the laws and
regulations that affect our members’ businesses.
c. Working with Franchisors: In the past months, AAHOA
has reached out to the leading hotel franchisors in
an effort to encourage them to work with our members
to survive the economic crisis, including by granting
extensions on renovations schedules, construction deadlines,
new program roll outs, limiting new license applications
while keeping impact in mind, etc. I am pleased to report
that AAHOA has had good cooperation from all brands
regarding this request from us. d. Loan Default: If the bank simply takes a property,
the note is gone and there is no debt service. I personally
am working to educate lenders to work out extensions
or interest-only arrangements during a downturn. This
way, nobody loses, and there is less collapse of the
4) How can AAHOA members participate in AAHOA
activities and take-up leadership position in AAHOA?
There are many opportunities for members to participate
in AAHOA activities. We have many events each year that
are designed to allow for member education and interaction,
including our Annual Convention, regional meetings,
town hall meetings, industry conferences, a leadership
conference, franchisor brand meetings, special events
for women and young hoteliers, and more. Our Ambassador
program is a great way to take steps towards a leadership
position in AAHOA, and allows for a great deal of interaction
between the AAHOA members and leadership. Our elections
for the Board of Directors and officers positions are
democratic—as long as a member is in good standing and
meets the requirements, anyone can seek election. We
are one of only few associations in the country where
our elections are contested elections.
5) What can AAHOA members do to make AAHOA stronger
Any membership, no matter how large, requires ongoing
activism. AAHOA is continually seeking to increase the
political participation of our association and our members
at the grassroots and federal levels. Our PAC is strong
this year and we are striving to build on this momentum.
Imagine if only half of our about 9,000 members each
gave $1/day for a year, that would be over $1.5 million!
An established PAC fund will increase AAHOA’s political
clout and enable our association to support members
of Congress who understand the needs of small business
owners and are doing the right thing for our community,
our country, and the world at large.
6) Is AAHOA working on plans to attract younger
hoteliers by creating Web2.0 based Hotel community website?
As technology changes and improves, we are constantly
looking at ways to use such technology to accomplish
our many goals and objectives through our website. Internet
usage is high among all age groups so a specific demographic
is not being targeted; the website will appeal to and
be made relevant for all users.
7) What steps can new US administration take
to boost US travel and hotel industry?
First and foremost, we need to take steps to increase
foreign tourism to the United States. On way to do so
is by passing the Travel Promotion Act, which will enable
the U.S. to market itself as a tourism destination abroad.
Countries such as France, Spain, Italy and others spend
hundreds of millions of dollars marketing their countries
to drive tourism, and we should take note. The U.S.
was number 1 in visitation until a few years ago and
have now fallen to number 3. We have lost our leadership
position due to high visa costs, a lack of marketing,
and a damaged reputation abroad. By addressing these
issues, we can increase foreign tourism to the U.S.,
stimulating the economy for the good of all.
8) As a successful hotelier, kindly share 3
qualities hotel owners must have to be successful.
a. Financial Sense,
b. Leadership, and
c. Love of Hospitality.
9) How can small hotel owners take advantage
of latest in Information and management technology to
grow their business? How will AAHOA help the small hotel
It all starts with professional development. AAHOA offers
a Certified Hotel Owner program free to our members
that help them learn all facets of the business. AAHOA
helps small hoteliers compete on a more even plane with
larger hoteliers by maintaining vendor relationships
which allow for volume purchases and savings. Education
also plays a big role, as well as networking opportunities
such as town hall and regional meetings. Certain vendor
programs also help, such as programs that help with
reservations, marketing, etc.
10) What is your vision for the future progress
of Asian Hotel owners?
As time passes, I see AAHOA members moving up from the
economy-priced hotels to the luxury, boutique and resort
sector. We have a global economy now and global opportunities.
AAHOA needs to continue in its role as the voice of
the industry, and remain active in politics in order
to protect and preserve what we work so hard for.
11) There are lot of entrepreneurs in India
and Gujarat who dream about coming to US and setting-up
their hotel business. What will be your advice and coaching
to these young people?
AAHOA offers hospitality training programs in India
to help aspiring hoteliers to develop crucial business
and operational skills. I would encourage these hoteliers
to take advantage of these programs before relocating
to the United States. Upon moving to the United States,
I would suggest joining AAHOA and taking advantage of
the vast line-up of resources that we offer, including
the knowledge base of our over 9,000 members. Our CHO
programs are offered free to members.
It is also important not to overlook the great business
opportunities present in India. There is a small room
count in India and a greater population, especially
in the middle class which amounts to about 300 million
people—that is greater than the US population! Recently
this is leading even American hoteliers and Indian-American
hoteliers to look to India for opportunities.