Thomas J. Corcoran Jr., chairman and co-founder of Irving, TX-based FelCor Lodging Trust Inc., assumed the role this fall as chairman of IAHI, the 3,000-member ownership organization for InterContinental Hotels Group (formerly known as the International Association of Holiday Inns). He most recently served as president of the American Hotel and Lodging Association, giving him added insight into the challenges ahead for the US hotel industry. FelCor owns 129 hotels in 30 states and Canada, and is the largest owner of upscale all-suite hotels with 71. Corcoran shares his thoughts on a range of issues in this exclusive interview: What do you see ahead during your term as IAHI chair?

Corcoran: I suspect that everything I thought I was doing has been trumped by the economy and the challenges that we are facing relative to 2008, and going into 2009, and how the economic problems are going to impact the RevPAR performance of the hotels. What is the association doing to help its members get through the difficulty?

Corcoran: We are encouraging all of our owners and franchisees to continue to use all of the tools available to them through the IHG (intranet) site to drive revenues and perform benchmarking against other similar type hotels. I think we will probably increase the overall amount of communication through IAHI to its members after our December board meetings in terms of more specifics that they can and should be doing next year. Does having recognizable brands help during downturns, and can hotel owners rely on those brands to help?

Corcoran: Historically, branded hotels have done better in downturns. Those that have been kept reasonably new and fresh do tend to do much better because of the power of the brand. That’s a strong value that our franchisees have that we can take advantage of during these uncertain times.

We will do some aggressive marketing to some of our Priority Club members, which represent approximately 45% of our overall business. That is a vehicle that has been helpful and should be helpful to us next year. What should hotel owners do to keep from having to cut their daily rates?

Corcoran: Smith Travel Research determined after 9/11 that reducing price will not increase demand. Owners are much more disciplined today than in the past. Information that we didn’t have in the prior cycle is leaving us with some better average daily rate integrity.

If you’re in the full-service business, there are a few things you can do. For example, if your hotel restaurant doesn’t do a lot of lunch business or is not in a large office district, you could consider not opening for lunch. In some cases they could look at reducing (employee) hours. Most of the brands have been fairly helpful in coming up with solutions.

The one thing that owners and operators can’t back off today is the need to drive revenues and remix your business. That continues to be the number-one priority to the extent that you can accomplish service levels depending on the kind of hotel you have. What are your thoughts on immigration reform and the H2-B visa extension for temporary workers? Will a new presidency make any difference in that regard?

Corcoran: Most of us believe that immigration reform was on the agenda of both candidates, but the comprehensive nature of the H2-B issue stopped the debate last time. There was a belief that everything needed to be dealt with all at once.

I can’t help but think that economy issues are going to trump the prioritization of immigration reform in the short term, but it is clearly a priority for Barack Obama. If it is similar to the last bill that went through, the Senate dealt with the H2-B visa problem by increasing the total amount from 60,000 to 300,000, which we feel addresses the issue properly.

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