While the whole hospitality industry watches stock prices fall, Patriot American Hospitality's unstable financial situation became more evident in November, when it announced that it would not be distributing third-quarter dividends. This upheaval will likely result in asset sales and changes in corporate structure.
Analysts predict an unsteady future for hospitality giant Patriot American Hospitality-owner of the 'mother-spa' Golden Door. Golden Door clones are expected to open at Patriot's flagship properties-including every Grand Bay hotel or resort, and every Carefree Resort (including Carmel Valley Ranch, The Boulders, and The Peaks in Telluride.)
The company's stock has fallen more than 75% this year. According to a recent article in HOTEL BUSINESS (December 7-20, 1998) entitled 'Debt-ridden Patriot seeks to liquidate assets,' Patriot's financial problems include $1.1 billion in short-term bank debt and $313.6 million in equity forwards due. The recent article reports that Patriot is trying to buy time--renegotiating their debt and raising money by selling additional assets. Meanwhile, investor confidence continues to be shaken, resulting in a downward spiral.
10th Annual Atlanta Hotel and Investors Panel Summary, April 1998
Analysts predict an unsteady future for hospitality giant Patriot American Hospitality-owner of the 'mother-spa' Golden Door. Golden Door clones are expected to open at Patriot's flagship properties-including every Grand Bay hotel or resort, and every Carefree Resort (including Carmel Valley Ranch, The Boulders, and The Peaks in Telluride.)
The company's stock has fallen more than 75% this year. According to a recent article in HOTEL BUSINESS (December 7-20, 1998) entitled 'Debt-ridden Patriot seeks to liquidate assets,' Patriot's financial problems include $1.1 billion in short-term bank debt and $313.6 million in equity forwards due. The recent article reports that Patriot is trying to buy time--renegotiating their debt and raising money by selling additional assets. Meanwhile, investor confidence continues to be shaken, resulting in a downward spiral.
10th Annual Atlanta Hotel and Investors Panel Summary, April 1998
- The labor shortage in the Hospitality Industry will continue, however management companies and owners who are able to use technology and educate, train and empower their employees will be less impacted.
- Consolidation will continue in all facets of the Hospitality Industry.
- Profitability will continue in most segments of the Hospitality Industry because of new technology in operation and equipment and consolidation large and small.
- The availability of money will keep the Hospitality Industry healthy into the year 2000 baring any unforeseeable disaster. However there will be some minor glitches such as the Asian Crisis along the way.
- Some brands will fail; some chains--in pursuit of growth--will continue to stretch the brand's meaning to utter meaningless.