Hotel group builds confidence with clients during pandemic
Naples Hotel Group’s experience and expertise has sown confidence among clients — even during the pandemic. Many have hired the company for multiple management assignments.
| 6:00 a.m. January 29, 2021
Commercial Real Estate
Naples Hotel Group’s job as a third-party hotel developer and manager is to “alleviate headaches” for its clients, many of whom have hired the company on a repeat basis to oversee hospitality operations throughout Florida.
That’s been especially true during the past year of the COVID-19 pandemic, when occupancy has plunged throughout the lodging sector and Revenue Per Available Room (RevPar), a key industry metric, has plummeted.
Unlike some hospitality managers, Naples Hotel has been able to keep properties stable — and add hotels to its portfolio — throughout the pandemic by providing a unique expertise and by applying its own experience as an owner and operator.
“We know what clients want,” says Mike Bou-Sliman, who together with his wife, Hayley, founded the company in 2010 and are today its managing partners.
“We’ve been there, as an owner and an operator. I was told a long time ago that until you have to write a mortgage check for a hotel, you don’t really understand. And I think that’s true. These projects cost a lot of money, and we’ve very conscious of that. We understand first-hand the level of risk our clients are taking.”
It’s partly why Naples Hotel advised client HG Management LLC, of Tampa, to proceed with the development of a 110-room TownPlace Suites by Marriott property, in Orlando, despite the virus.
The six-story hotel, at 51 Columbia St., broke ground in March 2019 — just as the pandemic was beginning to decimate the tourism and travel industries.
And while the $28.3 million hotel’s opening was delayed — from July to mid-December of last year — the Naples-based manager advised moving forward.
“We determined that while there was no rush to reach the finish line, at the same time we felt we were going to come out of the pandemic eventually and the property would need a ramp-up period,” says Bou-Sliman.
“We knew there were ‘X’ costs associated with it anyway, so our feeling was let’s get it open and work the kinks out now,” he adds. “Hopefully in six to eight months we’ll be able to be further down the road and get some traction.”
Naples Hotel was able to come to that conclusion, in part, because of its knowledge of the Orlando market. It also manages the adjacent Hampton Inn & Suites on behalf of HG Management.
It also relied on its knowledge developing select-service hotels flagged by Hilton Hotels and Marriott International Inc. from the ground up, a skill set that many hotel managers lack.
“We realized most management companies don’t know how to build a hotel, why would they?” says Bou-Sliman, 56. “And construction companies don’t understand the nuances of operating a hotel. We bring those two together, and as a result we save our clients both time and money.”
Today, Naples Hotel oversees construction, furniture, fixture and equipment installation, staff training, cleaning and final staging for clients, along with day-to-day operations.
The strategy has worked. Naples Hotel today oversees 18 hotels containing roughly 2,000 rooms throughout Florida in Naples, Estero, Stuart, Miami, Orlando, Jacksonville, Miramar and Riverview, to name a few.
The company also has another two properties set to open in the next three months — including a TownPlace Suites in Tampa — and others in development in Lakeland, Leesburg, Plant City, Sarasota, Orlando and Winter Haven, which collectively will add another 600-plus rooms to its portfolio.
In Lakeland, Naples Hotel will manage a new Tapestry hotel by Hilton, a 88-room boutique property to be housed in a historic hotel that was the first in Florida to receive air conditioning in 1924. It will mark the first time Naples Hotel has delved into the full-service end of the sector.
In all, the 11-year-old company now has nearly 300 employees.
“They’ve done a really good job in light of COVID-19,” says Mike Yan, who hired Naples Hotel in 2007 to manage the Fairfield Inn he owns in Pensacola. “Their hands-on style has allowed them to really keep costs down, which has been great.”
Bou-Sliman says Naples Hotel has been “extremely fortunate” despite the COVID-19-induced downturn.
“Limited-service hotels like the kind we manage tend to weather downturns better than full-service properties that have a lot more overhead,” he says. “And extended-stay product, which many of our properties are, have performed really well.”
Roughly four-fifths of Naples Hotel’s portfolio has maintained occupancies of 50% or better, meaning they’ve cash-flowed and broke even. That, in turn, has allowed the company to avoid the furloughs of corporate staff that have beset many managers and operators.
By contrast, RevPar in U.S. hotels as a sector dropped by 80% from March 2019 to March 2020, according to lodging researcher STR, and many properties have yet to recover from those losses in any meaningful way.
'A little bit crazy'
Bou-Sliman got his start in the hotel business in Ohio, following in the footsteps of his father.
When he came to Florida in 1993 and developed a Hampton Inn in Bonita Springs, Bou-Sliman and Hayley followed to manage the property when it opened in 1996.
A couple of years later, Bou-Sliman found a piece of property at Interstate 75 and Immokalee Road, which he thought would be well-suited to the Hampton Inn brand.
“People thought we were a little bit crazy, there was nothing there at the time, but I could see plans for future housing and that told me growth in Naples was headed north and east.”
The couple’s second Hampton Inn opened in 2000.
More properties followed, thanks to a partnership with a Nashville-based developer. But in 2009, the economic recession halted new lodging development.
The following year, the Bou-Slimans pivoted to exclusive third-party management.
At first, business was slow, but about five years into their venture, an expanding economy, low-interest rates and a growing reputation catapulted Naples Hotel to success.
Clients that had hired the company to manage one property began calling regarding another.
“Most of the clients we’ve worked with we’ve done two or more properties with them,” Bou-Sliman says. “And we’ve been selective in what projects we’ve taken on. It’s important for us to get to know each other to make sure our philosophies align.”
Case in point, Naples Hotel will manage a new Residence Inn extended-stay hotel in Sarasota for HG Management, the same company behind the TownPlace Suites and Hampton Inn in Orlando. It is scheduled to begin construction later this year and open in 2023.
About six years ago, the Bou-Sliman’s two children, Andrew and Brittany, joined the company. Today they head up acquisitions and development and marketing and business development, respectively.
Like many in the hotel industry, Bou-Sliman believes the future — as in, 2022 — will be bright, or at least brighter.
“The next six to seven months could be pretty rough, but by the third quarter of this year, I think we’ll start to see some daylight,” Bou-Sliman says. “In 2022, I think things will take off. There’s a tremendous amount of disposable income that’s been saved up during the pandemic because people aren’t, for the most part, doing anything.
“If the COVID-19 vaccine becomes widely available, I think people will be anxious to go somewhere by then,” he adds. “And Florida is such a drive-to destination for a lot of people.”