Denver hotelier Navin Dimond has navigated prior downturns and insists his Stongebridge Companies is poised for growth, despite a devastating year for the hotel industry worldwide.

Dimond recently appointed Aly-khan S. Merali president and managing partner for the private hotel owner, operator and developer.

“This move is needed to allow for expansion,” Dimond said in a phone interview Monday. “And frankly, you can only work two jobs for so long.”

Dimond remains CEO and now assumes the company’s chairman role. The two have known each other for years as Merali led Turnberry Associates as president and chief financial officer.

“After many years, we finally came together. This is a great fit for us,” Dimond said. “This strategically positions the company for growth.”

It’s hard to image a hotel chain executive talking about growth after a year which saw historic losses for the industry.

“While leisure bookings provided a bit of a cushion for hotels over the 2020 summer season, business travel—which comprises the largest source of hotel revenue—essentially ceased and remains nearly nonexistent,” according to an American Hotel and Lodging Association (AHLA) report “2021 State of the Hotel Industry.”

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The brutal stats include:

• While hotels could add 200,000 direct hotel operations jobs in 2021, that level remains nearly 500,000 jobs below the industry’s pre-pandemic employment level of 2.3 million.
• Half of U.S. hotel rooms are projected to remain empty in 2021.
• Business travel is forecasted to be down 85% through April 2021, compared to the same time period in 2019.

Yet, Dimond is confident Stonebridge will add to its “Distinguished Hospitality” 65-hotel portfolio, which includes 30 in Colorado.

“We’re definitely a growing company — we have been since inception,” he said. “In my world, you have to grow. And not just in number of hotels and rooms. We’re talking about growing the quality of the business, the spirit and the culture.”

Dimond said the private company will whether the storm because of its “favorable, low-leverage” position.

“We were under-leveraged before, but with the pandemic we’re appropriately leveraged,” he said. “That’s certainly one of the areas that makes life a lot easier in terms of when you don’t have the cash flow and servicing debt. … No one could have underwrote this scenario — we don’t plan for these things.”

When asked about the company’s revenue loss, Dimond approaches the question with almost a Zen-like response. And it showed his human approach to running Stonebridge.

“It may not always show up on the balance sheet and the P/L (profit and loss statement), especially in times like this pandemic,” he said. “Things to focus on today are psychological and social when talking about impacts on people in the industry. And not just hotels and restaurants — live sports; movie theaters; live theaters; and all the events and the folks who work those. Then there’s the uncertainty of the rules which go up and down. I’m not blaming the government here, but one day the business is open and you hire people back. Then there’s a shutdown and you’re closed again.  … It’s not just economic, it’s psychological and mental health impacts.”

While plans always remain in flux, Dimond said there’s a light at the end of the tunnel with the “pivotal turning point” of the vaccine is being distributed.

The AHLA predicts: “While the industry is expected to see better results this year compared to 2020, the projections for the next several years remain significantly below pre-pandemic levels before leading up to a full recovery in 2024.”

Stonebridge was growing rapidly in 2019 and the early part of 2020, with acquisitions in Denver (Hyatt House Denver Tech Center, Hyatt Place DTC and Hyatt Place at Park Meadows) and New Orleans.

The last properties Stonebridge acquired were in early 2020: the 168-room Residence Inn by Marriott Herndon Reston in Herndon, Va., and the 410-room Le Meridien New Orleans. That last one was the third New Orleans area purchase for the company in the 12 months prior.

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Dimond said the urban properties have been hit hardest by the pandemic, with withered business travel and dramatically fewer workers in downtown areas.

“The small towns have been better than the larger MSAs (metropolitan statistical areas),” he said. “The industry lost some 50% of its business, or some 5 million rooms, in 2020. That’s a giant number — and not just in terms of lost dollars. It’s the people in those jobs … We are an 80/20 industry which means there’s 20% management and 80% line staff. Most the people impacted were the line staff.”

Replacing the business travelers is more of the front-line workers as well, like nurses and National Guard members. Dimond expects the leisure traveler numbers — which largely remained consistent through 2020 — to increase in 2021 as more people suffer from what he calls the “same four walls syndrome.”

“That leisure piece of the business in the US is the fastest growing group.”