Tuesday, January 27, 2009

Expanding in a recession

They say the best time to start a business is in a down economy. For personal reasons I hope this is right. And so does Carlson Hotels, which, according to this story, plans to add 300 more properties to its portfolio through 2013. A cynic could say that since they opened 89 new places in 2008 this is a slower expansion, but any good news is great these days. And with more travelers going to brands like those Carlson sells, expanding in a down time (when costs may also be lower) may make financial sense. Lawyers' jobs could be easier since some people are just happy to sell or have work or provide services, regardless of the legal terms.

It makes sense for other reasons, too. We ALL know this is a cycle, and it takes a lot of time to bring something new online. So even if RevPAR is down a predicted 9.8% you have to be ready for the bounceback. Even in the face of bad news you have to be ready for the good news or get caught with your feet flat. I'm sure others are thinking the same way but probably not publicizing the fact.


CountingSheep said...

Well, that was a nice article. It was nice to see all the new space being leased in the headlines below the article. I was feeling blue in regards to the ecconomy as I see Bank of the West vacating their space in our building today.

The news from Home Depot yesterday was sad. I just have to think that the home supply business is on the cusp of a turnaround as the foreclosure home sales start to pick up.

CountingSheep said...

Oh, in regard to some Chicago news, I see Strategic Hotels got its loan covenants modified on its Chicago Fairmont loan and its Westin St. Francis SF loan.

David Stejkowski said...

I just wanted to find something -- anything -- positive. Perhaps this is just a raindrop in the storm.

I've given up on HD (though we still have some stock) as a shopper for Lowe's. I'm sad to see Expo go, but that's probably not where you go to fix up a foreclosure.

Thanks for the BEE tip. For those of you interested here is the 8-k filing: http://biz.yahoo.com/e/090126/bee8-k.html