Barry Sternlicht is chairman and CEO of Starwood Hotels & Resorts Worldwide Inc., one of the largest hotel companies in the world, with more than 750 properties in 80 countries and brands including Sheraton, Westin, St. Regis and W. Starwood opened the W New York - Times Square--the boutique-style chain's fifth in Manhattan--just in time for New Year's Eve. We spoke to Sternlicht recently about the new hotel and his company's plans for facing the current economy.
BiZBash: What will be the biggest challenge facing the hospitality industry in 2002?
Sternlicht: Pricing and getting people to show up. Our bookings aren't bad, but we don't know if they'll show up.
Are you concerned about opening a new hotel in New York during the current economic environment?
Although our business is down, we've grown our market share in the downturn. But I am concerned. We will try to make sure people know it's opening. We're opening in January, the weakest month of the year in Manhattan. Ordinarily, we wouldn't open in January because January is such a tough month--normal occupancy is 40 percent, compared to 90 percent at other times. But we did it to get publicity, that a hotel is opening at New Year's. I wanted people to know it's open. We're speeding through this faster than we wanted to, but I feel it's important for New York, too. If you have to open a hotel in Manhattan, Times Square is the strongest sub-market in the city--it's where tourists want to stay. Broadway shows are here, restaurants and nightclubs fill before and after the shows.
How is Starwood going after the meeting and event business now?
Our biggest challenge is setting the rates. We're trying to do our best to hold our rates, to get the rate to reflect the value in our product.
How important are hotel style and attitude during an economic recession?
I don't think people change their clothes, or what or where they drink, in a recession. The W customer likes this aesthetic. The question is how much more or less he will pay for it in a recession. Our crowd skews younger, and they've had massive layoffs. To some extent, W will have to continue to find its niche.
How did you choose your restaurant and nightlife partners for the new W in Times Square?
I talk to restaurateurs or potential partners for all of my business. A lot of times you're dealing with fabulous chefs who have no business sense. Sometimes you have [both qualities in one person], like with Steve Hanson [who is opening the hotel's in-house restaurant, Blue Fin]. Hanson is a W customer. It seemed like a natural fit; it's an easy and painless marriage. We'll probably do projects outside of New York.
Rande Gerber [who is opening the in-house bar, the Whiskey] has been our partner--we own half his company, Midnight Oil. He has the crowd we think is important to W, though we talked to other bar operators for this. The location is just too good. We're more concerned about security than if we'll be successful. It's a nightclub and bar, it has a dance floor with a DJ and screening room. It will be unique in the city that way.
What types of amenities are most important to meeting and event planners now?
High speed Internet access is becoming much more important.
What's your favorite annual event in New York?
When they light up the [holiday] lights on Park Avenue, it makes you feel good. And the ball dropping in Times Square on New Year's Eve--I would go, but my wife would never stomach the crowds.
Posted 01.14.02
Read about a Juvenile Diabetes Research Foundation benefit that honored Sternlicht...
Read about the sexy opening party for the W on Union Square...
BiZBash: What will be the biggest challenge facing the hospitality industry in 2002?
Sternlicht: Pricing and getting people to show up. Our bookings aren't bad, but we don't know if they'll show up.
Are you concerned about opening a new hotel in New York during the current economic environment?
Although our business is down, we've grown our market share in the downturn. But I am concerned. We will try to make sure people know it's opening. We're opening in January, the weakest month of the year in Manhattan. Ordinarily, we wouldn't open in January because January is such a tough month--normal occupancy is 40 percent, compared to 90 percent at other times. But we did it to get publicity, that a hotel is opening at New Year's. I wanted people to know it's open. We're speeding through this faster than we wanted to, but I feel it's important for New York, too. If you have to open a hotel in Manhattan, Times Square is the strongest sub-market in the city--it's where tourists want to stay. Broadway shows are here, restaurants and nightclubs fill before and after the shows.
How is Starwood going after the meeting and event business now?
Our biggest challenge is setting the rates. We're trying to do our best to hold our rates, to get the rate to reflect the value in our product.
How important are hotel style and attitude during an economic recession?
I don't think people change their clothes, or what or where they drink, in a recession. The W customer likes this aesthetic. The question is how much more or less he will pay for it in a recession. Our crowd skews younger, and they've had massive layoffs. To some extent, W will have to continue to find its niche.
How did you choose your restaurant and nightlife partners for the new W in Times Square?
I talk to restaurateurs or potential partners for all of my business. A lot of times you're dealing with fabulous chefs who have no business sense. Sometimes you have [both qualities in one person], like with Steve Hanson [who is opening the hotel's in-house restaurant, Blue Fin]. Hanson is a W customer. It seemed like a natural fit; it's an easy and painless marriage. We'll probably do projects outside of New York.
Rande Gerber [who is opening the in-house bar, the Whiskey] has been our partner--we own half his company, Midnight Oil. He has the crowd we think is important to W, though we talked to other bar operators for this. The location is just too good. We're more concerned about security than if we'll be successful. It's a nightclub and bar, it has a dance floor with a DJ and screening room. It will be unique in the city that way.
What types of amenities are most important to meeting and event planners now?
High speed Internet access is becoming much more important.
What's your favorite annual event in New York?
When they light up the [holiday] lights on Park Avenue, it makes you feel good. And the ball dropping in Times Square on New Year's Eve--I would go, but my wife would never stomach the crowds.
Posted 01.14.02
Read about a Juvenile Diabetes Research Foundation benefit that honored Sternlicht...
Read about the sexy opening party for the W on Union Square...
