HB ON THE SCENE: Economy, Politics are Hot Topics at AAHOA

SAN ANTONIO—The focus of today’s general session at AAHOA’s conference: education. Many of the speeches revolved around the economy, the current political environment and how the hospitality industry can stop the government from crippling the industry. 

Beginning the day’s general session, Chip Rogers, AAHOA president and CEO, spoke highly of the industry’s current state, as well as the overall economy. He pointed to the stabilization of oil; the two-plus years of oil prices under $2.80 per gallon; the U.S. housing market being up 38%; and the rising of the consumer confidence index. “The overall American economic outlook is strong,” he told a crowd of more than 6,500 attendees and exhibitors on hand at the annual conference.

In his opinion, with the help of the new administration in Washington, DC, regulations will be lifted and tax reform will be possible. “Believe me, we need tax reform,” he said. He additionally expressed his high hopes for the “business-friendly Congress.” His concerns, which have been echoed throughout the industry, include organized labor trying to influence wages; minimum wage increases in 19 states; and Obamacare, which he says puts a burden on employers to follow mandates. No matter what the future holds for the industry politically and economically, “AAHOA members will prevail,” he said.

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On the numbers, Amanda Hite, president and CEO of STR, pointed out three markets have performed poorly over the past year: NYC, Miami and Houston. All three markets have dragged down the results in the United States. Occupancy growth rapidly approached 0%. STR expects occupancy growth to go negatively this year. RevPAR growth is beginning to slow, she noted.

Currently under construction are 195,000 rooms across the country—the majority of which are in the upper-midscale market segment. “It’s that limited-service segment where we’re seeing all that supply growth,” she said. Additionally, the past seven years have been unusual: lodging demand growth has exceeded GDP growth.

Teague Hunter, president of Hunter Hotels, took center stage to provide advice on the industry, pointing out how plenty of capital is being thrown back into the market. Lifestyle markets he favors include New Orleans; Louisville, KY; Richmond, VA; Jacksonville, FL; and Portland, OR. He stressed the importance of leveraging relationships at home. “My real advice is you guys know your local street corner better than anybody else,” he said. Before his departure, he left the audience with this piece of advice: “Listen to the next generation; involve the next generation.”

Grover Norquist, founder and president, Americans for Tax Reform, shared his belief that hotel owners are being targeted by the government with regard to taxes, regulations, opening them up to trial lawyers and strengthening labor unions. “The good news is, on all four fronts, the next 10 years are going to be brighter, not darker,” he said. He urged attendees to get politicians to commit to not raising taxes by having them write it down. “Politicians raise taxes because they can’t manage money correctly,” he said.

The first step to tax reform: He urges a repeal of Obamacare (which was made up of 19 different taxes, he noted). He pushed for a tax reform being packaged by President Donald J. Trump and Republicans that brings down the corporate income tax rate from 35% to 20% (although he prefers the original 15% the president had promised during his campaign). 

Norquist stressed the importance of a single income tax rate at the federal level. Why does the federal government have more than one rate for Americans? According to him, it’s easier for the federal government to “mug” taxpayers when it needs additional money (multiple rates allows them to tax one group and not another).

Radio show host and Fox News contributor Laura Ingram followed Norquist, beginning her speech by cracking jokes and doing her best Trump impersonation (the crowd responded with laughter). Curious about party affiliation in the room, she asked attendees about their political views. Jokingly, afterward, Ingram asked the Democrats in the room to “get out.” The overwhelming majority of the hotel owners in the room identified themselves as Republican voters.

According to Ingram, what makes the country great is “the regular American work ethic.” She also elucidated her view on immigration, which received a round of applause: “Stop insulting legal immigrants, and do it the right way.” Before leaving the stage, she left attendees with some advice President Ronald W. Reagan, her former boss, had given her many years ago: “Make it matter.”

The final speaker of the day was David Robinson, a former NBA player who now owns Admiral Capital Group. “My passion is taking up the resources we have to do positive things in the communities where we are,” he said. An example of this is a partnership he’s had with Hilton where mentors are educating students from inner-city schools who are interested in hospitality. These students are learning through hands-on experience in areas such as housekeeping, maintenance and F&B. Speaking briefly on culture, he told attendees how the “right culture can perpetuate itself and add success.”