Stories of Three Midwest Family-Owned Hotel Chains: All Trace their Roots to Hard Work and Modest Origins
George C. Ford | The Gazette, Cedar Rapids, Iowa | March 5, 2018 3:39pm
March 02--Three Midwest family-owned hotel chains, including two in Eastern Iowa, trace their roots to hard work and modest origins. Here are their stories.
Three hotels, no employees
When Bob and Angie Patel emigrated to the United States from India in 1980, they worked in fast-food restaurants and operated newspaper routes.
The couple saved their money and, in 1982, they bought a shuttered roadside motel in Mena, Ark.
Bob handled the physical renovation of the hotel and Angie managed the books and cleaned the rooms. The couple eventually bought a hotel in Hannibal, Mo., and later built a Comfort Inn in Burlington, Iowa.
"My parents thought a motel offered a home for their family while providing them an income from a business," said Raj Patel, today Hawkeye Hotels chief development officer.
"We grew up in the family business, learning by their example and hard work. They operated their first three hotels without any employees and no job was too menial for them.
"I remember my father cleaning and repairing air conditioners and my mother cleaning guest rooms. They taught us to respect everyone, regardless of their job or position."
Raj's brother, Ravi, is president of Hawkeye Hotels and their sister, Sajni, is vice president of the company. Bob, CEO, and Angie, corporate director of payroll and accounting, continue to own and be active in the management of the rapidly expanding company.
Hawkeye Hotels owns and operates more than 50 hotels in 18 states with investments in an additional 25 assets. It also has 15 new hotels in construction and pre-construction phases.
It operates full-service, select-service, limited-service and extended-stay hotels under brands including Marriott, Hilton, IHG and Starwood.
Hawkeye Hotels employs 45 people, with more than 1,800 employees in the hotels it operates.
The company, which moved its corporate headquarters from Burlington to Coralville in June 2017, expanded its reach into full-service hotels with the conversion of the Park Plaza Hotel in Bloomington, Minn., to a Courtyard by Marriott property, and the $40 million renovation of the Hotel Fort Des Moines, which it purchased for $4 million in February 2015.
Raj Patel said the company aims to own and manage full-service hotels in large metropolitan cities. It acquired the 135-room Hotel Modern in New Orleans in June 2016 and followed up with the purchase of the 91-room Omni Majestic Hotel in downtown St. Louis in July 2016.
"We are a young company that has grown aggressively and we don't plan to slow down," he said. "We will continue to look at additional hotels in our home state of Iowa, but we also will look at other states.
"We would consider Alaska and Hawaii if the right deal came along that would be good for the future of our company."
The cliff House
Kinseth Hospitality Companies of North Liberty company traces its roots to the late 1950s when Kenneth Kinseth, a general contractor, and his wife, Cyrena, bought the small Deluxe Motel in Decorah.
The Kinseths added a restaurant in 1963 and changed the name of the property to the Cliff House.
Cyrena planned weddings and special events for customers, becoming known as the consummate hostess.
With a lot of hard work and the support of their children -- Les, Linda, Bruce and Gary -- the Kinseths expanded the property into a 108-room hotel and restaurant. In 1977, the semi-retired Kenneth and Cyrena sold the hotel. A Marriott Fairfield Inn and Suites now stands on that location.
"As my parents got closer to retirement and the kids got older, we really didn't want to have a lot to do with the hotel business," recalled Gary Kinseth, vice president and director of operations.
"A year or two after our parents got out of the business, we started a hospitality company in Council Bluffs when we bought a Ramada Inn, which we renovated into a Best Western.
"Two years later, we were looking for another opportunity and we purchased a Best Western in Clear Lake. Our father and mother came in as partners.
"We ran the two companies together until we bought our parents out a number of years later."
While the many of its hotels are located in Iowa, Kinseth Hospitality Companies also owns and manages venues in nine other Midwestern states.
The company also owns and manages restaurants, such as Twelve01 Kitchen and Tap in Coralville as well as Bennigan's in Clear Lake, Des Moines and Rock Island, Ill., River Rock Kitchen and Tap in Dubuque, Kokomo's Bar and Grill in Fairfield, and Green Mill in Overland Park and Wichita, Kan.
"We run our restaurants as a stand-alone business to bring guests in both internally and externally," Kinseth said. "A typical restaurant cannot survive on purely hotel traffic."
From about 50 employees when Kinseth Hospitality Companies operated a single property in Council Bluffs, the company has grown to about 3,500 today. Kinseth said the company continues to add hotels, such as the Hilton Garden Inn on South Clinton Street in Iowa City and the TownePlace Suites on Seventh Avenue in Marion.
Earlier this month, Kinseth Hospitality Companies opened the doors of the 82-room, four-story Tru by Hilton at Westdale, the 12th Tru by Hilton to open in the nation. It will open additional Tru by Hiltons in coming months.
Looking to the future, Kinseth said members of the third generation of the family are active in the business.
"We have quite a number of family members coming up in the business, but also people who have been with us for five, 10 and 15 years," he said. "We have one employee who is pushing his 35th year with us ...
"Hilton, Marriott and a number of our brands have a large focus on treating our team members right and they will deliver that to our guests. My siblings and I grew up in the family business where we treat our guests and team members as family."
'It took three chickens'
Another Midwest family-owned hotel chain with humble origins is Drury Hotels of St. Louis, Mo., which is building a 189-room hotel at East Ninth Street and Ring Road in Coralville's Iowa River Landing.
During the Great Depression, Lambert and Lorraine Drury lost the family farm in Kelso, Mo., purchased for $9,000 with money they had saved in the 1920s. They were told that they needed to move off the farm because they couldn't make the payments on their operating loan from the local bank.
The bank relented when it could not find a better operator and allowed the family to stay on the farm if they kept the weeds under control and eventually made their loan payments.
Along with his sons -- Charles, James and Robert -- Lambert Drury started a plastering business to supplement the family's farm income.
Chuck Drury, speaking in January at a Cape Girardeau, Mo., Chamber of Commerce banquet, said his grandfather taught his sons the value of hard work and sharing.
"They watched their dad always take the toughest part of the plaster job -- the small, exacting space of a closet," said Drury, today CEO of Drury Hotels. "As their skills grew, they each would run to see who got the closets first because they learned from their teacher's willingness to take responsibility and give that little bit extra to help the team.
"It took three chickens to make one dinner for their large family, and they grew up thinking their dad loved the backs. Grandpa took the backs so his kids could have the best, meatiest parts of the chicken."
While they were plastering a Holiday Inn in Paducah, Ky., the Drury brothers believed they had learned enough to build their own hotel.
They opened a 108-room Holiday Inn in 1962, near where Interstate 55 would be built outside Cape Girardeau. After operating the hotel for nine months without a profit, they hired an accountant and discovered they were making money on renting the guest rooms, but losing it on a restaurant and bar.
The experience led to the construction of the first Drury Inn in Sikeston, Mo., which opened in 1973 and did not include a bar or restaurant.
Drury Hotels, wholly owned by the Drury family, has grown over the decades to operate a chain of about 150 mid-scale, limited-service hotels under the Drury Inn and Suites, Drury Inn, Drury Suites, Drury Plaza Hotel and Pear Tree Inn brands.
The company employs more than 5,000 people in 25 states.