Thursday 29 June 2017

The Interview: Hotel chief keeps his eyes wide open in the city that never sleeps

Those who stand still are brushed aside very quickly

Emmet Oliver in New York

John Fitzpatrick is not your typical Irish hotelier. Firstly, he is in the black, secondly he is paying his interest bills and thirdly he has the resources to refurbish and modernise his properties.

But then again, he lives and works in New York, the world's fourth largest city and one of the five most visited cities on the planet. Because of this and his natural empathy for other hoteliers, Fitzpatrick is not about to begin lecturing Irish hotel owners on what they are doing wrong or indeed right.

While Fitzpatrick's hotels are located in a city that tends to take recessions in its stride, it is also an ultra competitive city where hotels which stand still get pushed aside very quickly. This year for example 60 new hotels are due to open in New York City, putting thousands of new rooms into a market already dealing with plenty of capacity.

Product fresh

Fitzpatrick as a result has to keep his product fresh. With a hotel on Lexington Avenue and another beside Grand Central Terminal, there is no place to hide if a property is starting to look jaded.

Fitzpatrick as a result has upgraded or is upgrading both hotels, though he likes to minimise disruption to guests by getting work done floor by floor, rather than closing down hotels entirely.

Fitzpatrick, a dapper man with a good sense of humour, still has a portrait of President McAleese in the lobby of his hotel on Lexington Avenue. The list of famous Irish who've stayed at the property is exhaustive. But famous Americans have stayed there too, including Bill and Hillary Clinton.

Fitzpatrick has developed lots of connections in Irish-America and he often put up guests involved in the peace process at his hotels in the 1990s.

As of now he is the only man running large scale Irish-themed hotels in Manhattan, but that may not continue forever. But whatever competition comes at a future date, Fitzpatrick is sanguine. He is busy on the day job and also chairing the Hotel Association of New York City, a group which represents hotels offering 75,000 rooms.

However Fitzpatrick knows what markets to be in and the ones to leave. In 2006 he sold a Fitzpatrick property in Chicago after he got a very attractive offer.

He says at some point in the future he'd like to add a third property in New York, but he has enough on his plate now.

Fitzpatrick estimates that 30pc of his patrons originate in Ireland, but that group doesn't want the Irish sense that pervades the two hotels to be too cliched.

However American tourists often want a more stereotypical Irish hotel and Fitzpatrick has to get the balance right. Either way Irishness remains core to the two hotels, which even bake their own brown bread for guests.

"We've had to do a lot of work in the hotel industry generally in New York,'' he says. "Rates have come down, which seems on the surface to be a negative, but it means all hotels are now getting new customers they may not have got before,'' he explains.

Fitzpatrick says New York is no different to Ireland in terms of rates getting lowered.

He travels back regularly and his family are all involved in the Irish hotel industry, with his sister Eithne owning the Fitzpatrick Killiney Castle, his brother Paul owning the Morgan in Dublin's Temple Bar and his two other brothers Tony and Patrick holding stakes in the Beacon Hotel in Sandyford, Dublin.

The old Fitzpatrick hotel group was split up three years ago with family members buying each other out. Fitzpatrick says it was a good move.

"We've seen other family firms fighting over the years and we wanted to make sure that was never us,'' he says. "We wanted to do our own thing too,'' he adds.

He has been coming to New York since 1991 and has now developed a real sense of what will work there and what will not.

He says the Fitzpatricks in New York remains service orientated hotels. He fears for the future of what he loosely calls "trendy hotels'' in the city.

"Some of the staff in those hotels think they are more important than the customers,'' he says. Fitzpatrick employs 140 staff at his two properties and has not been forced into any major lay-offs since the downturn began.

He says the Irish are still flooding to New York, recession or not.

"I still see groups of Irish in the lobby with the shopping bags. New York remains a super destination in terms of value. Lots of people are not coming over to shop for themselves, but for the kids,'' he explains.

He says Irish visitors are not coming over all year though, with the visits more concentrated around certain periods of the year.

He acknowledges the depth of the recession and says hotels in Ireland are finding it very tough.

He says some Irish hotels, which he says he would rather not name, are cutting their rates to such an extent that he wonders how they survive.

Short-term game

"It's a short term game really, because ultimately in a hotel business you have to replace things, you have to modernise and refurbish and you can't do that when cutting your rates to the ridiculous levels some hotel owners are,'' he comments.

He says Ireland though had become too expensive and hotel purchases were done at inflated values by some buyers.

"If these buyers had spent their money here they could have bought some fine hotels,'' he says. He jokingly points out that the outstanding mortgage on the Waldorf Astoria is about $500m.

Ultimately though he is strongly against dispensing advice to anyone.

"Yes there are some hotels which should never have been built in Ireland, but the ones I feel sorry for are the genuine hoteliers who have the hotel as their sole income,'' he comments.

Irish Independent

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