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For First Time in Three Years Hotel Executives Optimistic About Asset Values
Increasing According to  DLA Piper's New 2011 Hospitality Outlook Survey

February 2011 - According to the DLA Piper 2011 Hospitality Outlook Survey, expectations for the continued recovery of the US economy and increased business travel have generated a renewed – and surprisingly robust – sense of optimism.

For the first time in three years, the overwhelming majority of respondents expect that hotel asset values will increase in the coming year, presenting the best buying opportunity since the recession. Seizing this opportunity, respondents believe that cash-heavy REITs and private equity investors will be the most active investors in 2011. Meanwhile, respondents are increasingly confident that their hotel debt will be refinanced or restructured in 2011.

On the operational side, guest input through the use of social media is playing an increasing role in hotel management as consumers more frequently rely on guest experiences, not brand loyalty, to make booking decisions.
Highlights of DLA Piper’s 2011 Hospitality Outlook Survey include:
  • 88 percent of respondents describe their 12-month outlook for the US hospitality industry as “bullish,” nearly tripling the bullish sentiment from 2010.
  • 82 percent of respondents expect hotel asset values to rise during the next year, compared with only 20 percent of respondents in 2010.
  • 9 out of 10 respondents believe that market conditions have created good buying opportunities for wellcapitalized investors, led by opportunities in the upscale and luxury sectors.
  • Respondents expect REITs (51 percent) and private equity (40 percent) investors to dominate
  • the US hospitality investment landscape in 2011.
  • 37 percent of respondents expect that their hotel debt will be refinanced or restructured in 2011 – up from 31 percent in 2010.
  • 69 percent of respondents report that TripAdvsior and other social media, including Twitter and Facebook, have changed the way they interact with guests.
  • Despite a heightened sense of bedbug paranoia among travelers across the country, the overwhelming majority of respondents (85 percent) report that fears over bedbugs did not negatively impact their operations in the past year.
  • The majority of respondents (65 percent) expect China to continue its dominance as the largest foreign investor in the US hospitality industry.

Respondents were asked to share their thoughts on the following in an open forum for comment and feedback. The following represent select verbatims received from survey respondents.

Has the popularity of TripAdvisor and other social media websites (i.e., Twitter, Facebook, etc.) changed the way your organization interacts with guests? If so, please explain how.
  • We are monitoring and rewarding our management teams on achieving high performance on these cites. We know the consumer is using them to make travel purchase decisions.
  • More reliance on past guest experiences than on brand.
  • Making brands less important for travelers making booking decisions.
  • If you are not contacting your guests through these new direct sales portals, you are missing the boat.
  • Brands have less impact on relationship between guest and property.
  • Social media give us the chance to speak directly to our customers in an unvarnished and non-threatening environment. It is the booking engine of the future.
  • One more guest relations channel that must be monitored and managed. Social media is becoming full-time position at a hotel. Can’t afford not to monitor and respond to all comments.
  • Directing satisfied guests to TripAdvisor (or similar).
  • We spend a lot of time “managing” TripAdvisor.
  • It has raised awareness about service delivery, communication, and delivering on the promise made.
  • There is more accountability -- whether to actual or perceived problems.
  • It can’t be ignored. Social media is replacing customer satisfaction surveys as the primary mechanism by which guests provide feedback, and it’s both instantaneous and shared with the world.
METHODOLOGY | In January of 2011, DLA Piper distributed a survey via email to top executives within the hospitality industry, including CEOs, COOs, CFOs and other senior executives, which was completed by 101 respondents. Question No. 2 was only made available to those respondents who described themselves as “bullish” in Question No. 1. Question No. 3 was only made available to those respondents who described themselves as “bearish” in Question No. 1. Due to rounding, all percentages used in all questions may not add up to 100 percent.

To view the entire survey please visit:

About DLA Piper:
DLA Piper has 3,500 attorneys in 30 countries and 69 offices throughout the US, UK, Continental Europe, Middle East and Asia. DLA Piper became one of the largest legal service providers in the world in 2005 through a merger of unprecedented scope in the legal sector. While large in scale, the merger strategy was simple – to create an international legal practice capable of taking care of the most important legal needs of clients wherever they do business. We wanted our clients to rely on receiving the right service for their particular matter, whether requiring seamless coordination across multiple jurisdictions or delivery in a single location.

Sandra Kellman
Global Co-chair and Head of Hospitality & Leisure Group US, DLA Piper
T +1 312 368 4082

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