Hotel Business Magazine 9/7/10 - Article written by Toni McQuilken
WEST HARTFORD, CT—When Simon Konover founded Konover Corp. 50 years ago, one has to wonder if he foresaw that what started as a real estate company would have such a diverse portfolio of services. The company’s vast array of servcies range from commercial development to residential real estate as well as hotel management, with a construction division thrown in. These pieces work to create a company that aims to be more nimble than some of its competitors.
One example is the Centennial Inn Hotel & Apartments, in Farmington, CT. The property was, at one point, a hotel only. However, when Konover decided to diversify, it went with a mixed-use development, and is now part hotel and part residential complex. Instead of hiring outside contractors, Konover took advantage of it’s in-house construction division to do the work for the change-over.
Being a diverse realty company brings in-house expertise and we’re able to do things that a fully commercial or fully hotel company might not be able to do,” said Peter Mason, Executive Vice President of Konover Hotel Corp.
For the most part, Konover’s hotels are select-service, including such flags as Holiday Inn Express, Hampton Inn, Microtel Inn and Suites and Super 8, as well as a Country Inn and Suites.
However, the company does have one full-service hotel: A Starwood Hotels and Resorts Sheraton located inside the Bradley International Airport in Windsor Locks, CT. According to Mason, Konover was a major player in the development of the airport 20 years ago, and took the opportunity to build the Sheraton property as part of the complex.
Like others in the industry, Mason noted Konover wasn’t immune to the economic troubles that plagued hotels, and travel in general. “I would say [our performance was] probably pretty much like everyone else. Last year was an extremely tough year for everyone.”
However things are starting to look up. “This year started out tough, but has really started to turn.” Konover saw a period of 19 months of down business, but, beginning in March of this year, started to see things going the other direction. “We started to turn up positive, and have stayed positive year-over-year since,” Mason said. He noted some of the properties in Konover’s portfolio are, in tough economic segments, but he’s optimistic about the future.
Konover doesn’t have a specific number of hotels it’s aiming for, but Mason said its philosophy is to acquire them one-off or in small groups. This allows the company to absorb the properties into its corporate culture easier and more efficiently.
“Understanding the asset, understanding the market drivers, understanding the structure of the property, [these are the things we look at],” Mason said. “The people side is very important to us, as well. We make sure we know all the strengths and weaknesses of the property so we know where to apply resources: systems, accounting controls, etc. It is kind of doing a SWAT, if you will, on the property, then looking at the support elements to provide the resources it needs.”
Acquisitions, however, aren't the only focus of Konover’s hotel group. “Even in the downturn,” Mason said, “we have continued to invest in our hotels.” The company put, he noted, $5 million into the hotels acquired in 2006 over the last 2-3 years. This year alone, it has invested $600,000 in the re-launches from IHG, as well as $7 million in upgrades to the Sheraton property.