You had mentioned before that you had a certain thing you were looking for in terms of a full-service brand, right?
Yeah, we’re spending a lot of time looking at European chains because the pricing is better. We like the opportunity there. The pricing is better and the currency. You can pay a fair price and actually get a pretty good discount. We’ve come close on a couple but haven’t pulled the trigger. And we’ve looked at everything here and just haven’t found the right path for us. Yeah, we would love to see Marriott and Starwood decide they want to move Sheraton off. I’d love to do that. You know, it’s funny. Everybody thinks they cut a great deal; we’re all a little jealous that they did such a great job. On the other hand, everybody goes, “Can you imagine that integration?”
A logistical nightmare. What do you think of Hilton’s new brand, Tru? I bring it up because Comfort Inn was specifically mentioned in the release.
That’s because we’re the dominant player in that space. They’ll do well, but I like where we are. Clearly it is competitive to us, but a lot of the people they’re selling to aren’t going to buy from us anyway. Hilton is a big company, and I’m not sure this brand will move the needle for them. I’ve been in a big company trying to move the needle with small hotels. It doesn’t work too well. Our brand has 98 percent recognition. It’s a good place to be with a brand that people have known for a long time that is well thought of and now is becoming increasingly attractive. We have revamped Comfort in a way that people are really looking at it hard. New construction starts were up 85 percent last year.
How has the drop in global currency values impacted your business?
It cost us money last year, but it wasn’t huge. We’re about 14 percent international, but I think it cost us $1.5 million or $2 million. It’s presented us with some opportunities, and we’ve announced a couple of partnerships in Germany and Poland and Benelux with multi-unit guys because we’re bringing some capital to bear. We actually like the idea that we’re bringing a strong currency into a market with a weaker one. Where we get paid in those currencies, yeah, it had an impact, but we think it creates more opportunity than it does an issue.
How about what’s going on in China? Does that have any impact?
China hasn’t been a major target for us. We’ve got a partner that’s building 25 hotels for us. I was over there this summer. You could tell this summer things were getting a little antsy, because they’d start a project earlier than they were originally going to. I’d ask why they were starting early and they’d say that now is a good time to take the money. Yeah, the government is just feeding all these projects, yet there are some beautiful buildings being built.
So China may struggle some this year, but struggling means something different when you’re going from 8 percent GDP growth to 5 percent. They’re still building a lot of stuff just to build it. That’s probably going to come to a halt, but it’s still a vibrant growing economy. And I’m hoping they stay healthy, because the biggest impact to us is their travelers. If the Chinese come to the U.S., they’re going to stay with us. They’re not staying in the other guys’ hotels.
