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Service For Those Who Serve

publication date: Apr 5, 2012
author/source: Caryn Eve Murray
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Service For Those Who Serve

Growing your government business is a good way to boost occupancy and give back.

Thursday, March 29, 2012
Caryn Eve Murray
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Not all forms of military service require uniforms, weaponry or deployment to foreign countries. Hotels, particularly those located near government agencies and bases, have been pledging their allegiance to the nation’s defense, aerospace and related areas, providing discounts to military personnel, contractors and subcontractors for years. It’s a credible combination of sound business practices and a bit of patriotism, with the reduced-rate offerings often facilitated through the FedRooms program established by the U.S. General Services Administration.

And yes, there’s an excitement factor built in sometimes as well. In Lexington Park, Maryland, where a Days Inn property is located directly across from the Patuxent River Naval Air Station, things can get mighty busy – and crowded – during military training sessions or testing of one of the Navy’s cutting-edge new airplanes after its arrival at the base.

“We know they are going to test this thing and we will see a lot of technicians, everyone coming down here,” said Ashish Patel, managing partner in Sandalwood Management, which owns the 134-room Days Inn. The buzz is good for business – at least that’s his plan.

 “Hopefully they will stay with me,” he said, offering as his property’s magnet a combo of discount rates and amenities, such as the built-in pool, assortment of recently enlarged rooms, complimentary hot breakfasts and a fitness center presently under construction.

But, Patel said, the overall hotel market along the main traffic corridor, known as Three Notch Road, has become well-populated by more than a dozen competing hotels, much of the construction newer or higher-end. So he has focused his budget-property’s attention solely on the small-business subcontractors within the government market, “the ones who are really on a budget.” They’re seeking a low price with as much value added as possible, he said, and that has been his mission since purchasing the Days Inn and beginning its refurbishment in 2007. In fact, he said, to keep things rolling until the fitness center is completed, he is already sending guests to a World Gym a few blocks from the hotel, with complimentary passes the hotel provides for them.

A similar scene has shaped the landscape further north, near the Andrews Air Force Base in Maryland. “Ninety-five percent of our business, most of it, is military business,” said Charlotte Whitehead, general manager of the Comfort Inn at Joint Base Andrews in Clinton, Maryland, a quarter-mile from the base. Whitehead said the area has been filling up with competing properties on different tiers, so it’s important to strike a balance that pairs the government-approved discount rate with the right mix of amenities.

Whitehead knows that, with only 7 kitchens among her 92 rooms, she may not always land the big contracts for large groups seeking to stay near one another for long-term periods. “If I had, maybe 30 rooms with kitchens, I could have landed a bigger military group,” she said. “But we get conferences from the base and that is real big.”

Both Patel and Whitehead said it helps to know your demographic – what is needed in order to give value, and what exceeds that – and then embrace it. Both carefully target that market, and plan their offerings accordingly.

The upside of the equation, however, is that because of the location, said Patel, “it is a ready market.” No advertising needed.

This form of government service is also, in many ways, a recession-beater and a business-builder.

“On any given day of the week, you have certain ebbs and flows to occupancy and demand,” said Thom Puccio, director of global segment sales for Choice Hotels International. About half of Choice’s 4,500 hotels are in the process of bidding for new government business contracts and have been active providers for some time.

“We are looking at this as another layer in occupancy,” Puccio said. “Depending upon how much availability I have on any given day, how many rooms I have vacant, I may shut down [government-available rooms] or open it up if I have a lot of availability. So I look at government business as another element that feeds into your hotel to generate revenue.”

Clearly, he said, “in first-tier cities, like New York, Chicago and Boston, there may not be a need for much government business.”

The bottom line is two-fold, he said. “If you look at the Department of Defense alone, you are talking about thousands of dollars expended in individual geographic locations. And that is only one agency.”

The other bottom line is a little less about dollars and more about dedication: “It is a service to the government. The ultimate goal of the program is to provide lodging for government travelers,” he said.

“People would not be a part of this if they didn’t think it was beneficial to them,” said Joseph McInerney, president and chief executive officer of the American Hotel & Lodging Association. “It brings people to stay with them at the hotel and secondly, it is a patriotic thing to do for the military people working on our behalf.”

And then there is the logical extension of that – this time a charitable one, extended to the troops themselves – which came to fruition late last year. Bipartisan legislation created a program known as Hotels for Heroes, which was enacted in late December, enabling owners of hotel reward points to donate them to members of the milirary and their families – similar to a program already in effect in the airline industry for frequent flier mile donations.

McInerney said the AH&LA will be working with the Fisher House Foundation, which assists military families with accommodations when a member of the service requires hospitalization or treatment.

“We are working on the program right now and plan to make an announcement soon on how the hotels will be working with Fisher House. It is part of a full package,” he said.



Caryn Eve Murray
Associate Editor
Hotel Interactive Editorial Division

Bio: Caryn Eve Murray is a freelance writer and an assistant editor on the news desk at Newsday on Long Island. During her tenure as a business writer for New York Newsday, she covered the city's small business community for which she won the Distinguished Business Reporting Award of Excellence from the New York Newspaper Publishers Association.

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