For a finance guy, Mike Depatie has had some serious brand-building experience. His second job out of business school was at Residence Inn, where he worked under Jack DeBoer to grow the brand from seven hotels to 100. After Marriott bought Residence in 1987, Depatie cofounded Summerfield Suites, which he helped grow to 37 hotels before Hyatt bought the brand. From there he went on to CFO gigs at La Quinta and Sunterra. Now at Kimpton, Depatie is heading a company that draws on both his financial and brand building expertise.
LODGING: How has Kimpton changed over the past 10 years you’ve been there?
Depatie: We’ve grown a lot, but the change has been more evolution than revolution. The revolution was the original boutique idea that Bill Kimpton had. The revolution was putting chef-driven restaurants in hotels. The revolution was turning old buildings into boutique hotels. We’ve evolved in the type of projects we take on—they’re more sophisticated than 10 years ago. We’ve gone from tertiary locations to secondary locations to primary locations—I mean, why encumber a premium spot with a chain hotel when you can put something special there that has no limit on what you can charge per night. We’ve evolved with the boutique concept, which has itself evolved dramatically—and we’re still the largest player.
LODGING: How about you?
Depatie: I’m really lucky. My skill set works well for this company because Kimpton is in the private equity business—managing and making real estate investments, owning and operating hotels. We’re managing 60 hotels now with 8,500 employees and 11,000 rooms. And we’re building an interesting, cultish new brand. As CEO I get to be involved in all of it.
LODGING: How does the Kimpton model work?
Depatie: Kimpton raises individual funds—the latest is $203 million—from institutional investors to use over a three-year period. We go out and find properties to turn into Kimpton-style hotels then buy them or convert them or whatever. Since we are also general partners in this fund, we write checks alongside our investors. As a general partner we act as the owner’s representative, making every finance decision, every refinance decision, and we employ the management company under a long-term contract. I can’t think of any other company that has this structure, and I think it works well for what we’re trying to do.
LODGING: What defines the Kimpton experience?
Depatie: It’s about making an emotional connection. We’re never going to beat the big guys at the distribution game—they’re always going to have more hotels in more locations. So we have no choice but to win on differentiated and distinctive customer service and unique guest programs. We provide a substantially better experience for our customers, which really matters in a world of social media in which people are constantly talking about their experiences online.
LODGING: Tell me about the new Caribbean resort.
Depatie: As our first Caribbean property, this Grand Cayman resort will be a natural evolution of everything we’ve learned so far with a few tweaks like more dining options and meeting spaces. It’s set to open in 2016 and our development partner, Dart Realty, is building it to the Cayman equivalent of LEED, so it will be ecologically sensitive and designed for the long term.
LODGING: So, when did your hair start going gray?
Depatie: When I was 18, believe it or not. Now I’ve always been a business guy so I liked having the gray hair. It turned completely white when I was 40. This is due to genetics—it’s not the job.