Merger benefits fail to impress hoteliers
Hotel takeovers and mergers do not always deliver the expected benefits, according to a new survey.
Less than half the respondents (49%) to a survey conducted as part of Hospitality 2000: The Capital believed big hotel mergers produced the economies of scale and advantages of global marketing that they are supposed to.
The survey was produced by Arthur Andersen, New York University's Centre for Hospitality, Tourism and Travel Information, and international association Hospitality Financial and Technology Professionals, based on 179 completed questionnaires from key investors and operators around the world.
"The survey results across the board were indicative of greater awareness of ‘New Economy' realities such as globalisation, the revolution in communications, consolidation in the industry, and technology," said Roger Cline, partner at Arthur Andersen.
"Both investors and lenders appear to have similar preferences. They generally want to stay with quality and size when it comes to property, and seek large branded management companies to operate the business."
The survey also revealed that, given the choice, investors preferred office, residential or retail properties over hotels.
Location remained the prime factor affecting investment and lending decisions. However, the survey found that intangible assets - such as brands, people, technology and strategic alliances - were becoming more important in lending decisions, although money-lenders still preferred to invest in property.
- The 125-page report, priced $125 (£82), is available by calling 00 1 941 341 2020, faxing 00 1 941 341 4312 or e-mailing vantagesource.mailbox@us.arthurandersen.com. by Angela Frewin
