As general manager of Intercontinental Boston, a luxury hotel owned by the international hotel chain, Timothy P. Kirwan has a firm grasp on global and regional trends in the hospitality industry.
Kirwan also commands a unique, birds-eye view of Providence’s local hospitality market, having been a central player in the sector during its rapid growth in 1990s. Among other positions Kirwan held between 1994 and his departure for Boston in 1999, he was the founding general manager of the Westin-Providence; was chairman of the Providence-Warwick Convention and Visitors Bureau and served on the board of the Rhode Island Hospitality and Tourism Association.
PBN: When you opened The Westin Providence, the city was in a very different place.
KIRWAN: When I first came there during the pre-opening in ’93, it was still very much a visionary condition. There were lots of naysayers; there were lots of folks who couldn’t see what everybody else was envisioning. … I remember doing the pre-opening budget work and projections, and being told by more than one so-called expert that I was nuts to think we would achieve a $200 average rate within the first three to four years of the hotel’s existence. We in fact exceeded that rate within the first six months of the hotel’s existence.
PBN: How do you see the hospitality market in Rhode Island now?
KIRWAN: Well it’s down obviously, vis-à-vis previous years, and it’s a tertiary market in terms of the big picture … and unfortunately on the downside they get hurt first, and then it trickles up to Boston and perhaps Philadelphia and others, and then it moves into New York, Washington, D.C. … We’re in that cyclical period where you all are down first, we’re flat in Boston – perhaps down in some segments – and the recovery will occur, but it’s a matter of when. And when it does, typically you all recover along with us.
PBN: When do you forecast a recovery?
KIRWAN: The best indications we can find, again looking at the global indicators, is that by Labor Day we should start to see an uptick. We’re hoping that we don’t get in any deeper second and third quarter and that as we start to get into the latter part we’ll start to tick up and hopefully by year-end we’ll be OK with our budgets and our projections.
PBN: Which cities is Providence competing with most directly, if we’re really not competing in the same ballpark as Boston or New York?
KIRWAN: Well you do compete with Boston to some extent on the smaller conventions, and certainly on some of the financial community and corporate travel business.
PBN: How is Providence doing in that regard?
KIRWAN: Right now I don’t think particularly well, because the Route 128 belt is already pretty competitive in terms of rates, so if it’s an Option A, Option B situation for people, they’re close. It’s not about the money only – it’s convenience, it’s egress and all that. … Statistically I don’t see any major losses from the greater Boston market to the Providence market of late. … I think you more compete directly with places like Manchester and Portland and Springfield, and south of you in Connecticut.
PBN: What does Providence have going for it in that regional competition that we can build on?
KIRWAN: Well from the south it’s much more accessible, much less congested. You can [get] in and get out of T.F. Green easily – it’s an easy-access sell to some extent. I love it, I love Providence – it’s got architecture, it’s got history, it’s got the universities, it’s got the museums. There’s a lot to offer for a small city, and it’s a value play right now.
PBN: How does the devaluation of the U.S. dollar versus the euro and other currencies impact hospitality here?
KIRWAN: It’s tough on cities like Providence and Manchester and Portland, because you don’t get the volume of international tourism that we do. Boston enjoys a fair amount of [travel from] Europe – mostly England and Ireland, maybe a little France. We’re getting a pop right now from Japan and India. The fact of the matter is, because Boston is a bigger city and more internationally connected, we got uplift from the currency situation in the leisure market. But, it also was offset by a decrease in the corporate market – our international corporate went down and our international leisure went up. In Europe right now they’re just as concerned as we are about this global economic downturn, so even though the euro is in their favor, their overall liquidity and their overall inclination to travel is a bit restricted right now.
PBN: There’s not a concern that those projects were started before a downturn that could jeopardize their eventual success?
KIRWAN: No, the vision [in the greater Boston market] is that the downturn is not going to be long or severe, and that they need to be in the ground by the time things really do turn around and trend up. So, those hotels are two to three years from coming online and the sense is now’s the time to move. And if construction costs start coming down and fuel costs start coming under control they can build these projects for some savings, vis-à-vis a year or two years ago.
I think in Providence everyone is pursuing certain projects under certain conditions, but it’s not a widespread lift yet. I think a lot of projects are either going to just sit tight or fall away. •
