Saturday, April 19, 2014
By Scott Mayerowitz
The Associated Press
(Continued from page 1)
Starwood Hotels CEO Frits van Paasschen, a triathlete, prepares for a ride in New York’s Central Park this month. His passion for health and fitness is reflected in amenities offered at the hotels he runs.
The Associated Press
“The hotel business grows alongside economic growth,” he says. “So as you can imagine, wherever there’s the kind of massive growth and urbanization we’re seeing in so many markets around the world, that’s where the majority of new hotels are being built.”
It seems to be working. In the last 12 months, Starwood has earned $649 million, up about 12 percent from the prior year.
CHAIN TARGETS OVERSEAS MARKETS
We zoom past a group of tourists on rented bikes near the Central Park Reservoir. New York is a great market for Starwood, and is its largest city with 22 properties. But rising quickly is Dubai, Starwood’s second-largest city with 14 hotels.
Then there is China. Most Western hotel chains have entered the market, but Starwood has an impressive 120 properties there. They aren’t only in big cities like Beijing and Shanghai but in the resort sections of Hainan Island and in smaller cities such as Daqing, Guilin and Luohe.
“We’ll have more hotels on Hainan Island than we do in Hawaii by the end of next year,” van Paasschen says.
Two-thirds of the guests in China are mainland Chinese, many part of a growing middle class that is starting to travel outside the country for the first time. Starwood hopes its name recognition within China will lead those new Chinese tourists to its properties in Asia, Europe and the United States.
“Chinese travelers today spend more outside of their country than Americans or Germans do,” van Paasschen says.
Prior to arriving at Starwood, van Paasschen was CEO of Coors Brewing Co. and before that, he held several positions with Nike, ultimately overseeing its business in Europe, the Middle East and Africa. He was previously a vice president in finance at Disney Consumer Products and began his career as a consultant at the Boston Consulting Group and McKinsey & Co.
While at Nike, it was routine to have meetings while jogging, giving van Paasschen an informal chance to give updates to his boss. Now, at Starwood, when van Paasschen travels, somebody on the hotel staff usually invites him on a run or a bike ride.
“A run in the morning is sometimes the best way to see a place right, particularly if the rest of your day is booked,” he says.
Managers who work for van Paasschen know that feeling. He moved the company’s entire leadership team to Shanghai for a month in 2011 and to Dubai for a month earlier this year. He plans another month overseas in 2015. He wants his staff to better understand the cultures they are opening hotels in.
“One of the best ways to draw attention to something is to go there,” he says, adding that staff back at headquarters in Connecticut had to adjust to doing business across several time zones. “My focus was to reinforce the notion of a global mindset.”
AMENITIES FOR ROAD WARRIORS
We near Central Park’s Great Hill and I ask if he minds peddling up the steep incline or wants to take a flat shortcut. Van Paasschen says that “climbing is really my great weak spot in cycling.” But then he flies up the hill, answering questions the whole time.
That shouldn’t have been a surprise. Last year, he did a four-day charity bike ride that covered 350 miles from Chamonix, France, through the Alps, to Monaco. It included some of the most challenging, high-altitude climbs from the Tour de France. This year, he rode from Salzburg, Austria to Munich.
“What I’ve learned is on those climbs, I’m going my own speed and it’s a lot slower than most everybody else’s,” he says.
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