5 Minutes With Michael Rawson

By Staff -- HOTELS Magazine, 3/1/2007

As a hospitality management student at Cornell University three decades ago, Michael Rawson interned at San Francisco's 1,195-room St. Francis Hotel. From that point on, he knew he was meant to work in small hotels, which he has done successfully. At 28, Rawson was named general manager of the Georgetown Inn, and he later helped André Balazs Properties open three hotels in six years as the company's senior vice president. Last year, Rawson was recruited by Michael Malone, the longtime owner of Seattle's Sorrento Hotel, to become general manager-and to help him launch a national hotel management company. Acumen Hotel Group began operating last November with the Sorrento as its flagship.

HOTELS: What is Acumen's business strategy?

RAWSON: We're not looking to buy and sell hotels, but maybe to help out independent, small hotels that aren't looking to be fl agged but aren't necessarily achieving their full market share. I've been at the Sorrento for 6 months; when I arrived, it was performing at about 85% of its RevPAR for the competitive set, and now it's at 110%. For me, it's about going in very quickly and formulating a customer base and seeing how we can increase client share. And at small hotels, it's especially important to focus on customer satisfaction.

HOTELS: Does that mean you will stay away from branded hotels?

RAWSON: We're looking at all independents-that's going to be a rule. There are trophy properties, properties that have been in the same family for a long time, and they don't want to give it up, but they're losing market share. From a technological standpoint, the Internet has changed the way the industry operates, and they may be out of touch with it somewhat. We think we can help them with that.

HOTELS: How will you differentiate Acumen from its competitors?

RAWSON: There are going to be several ways. One is the size of properties we're looking at and the independent nature of them. They'll be non-fl agged and not where the bigger players want to be. We'll have more fl exible contracts-we don't need the 20- year contracts. Our fee basics will be fl exible, and we'll invest in capital improvements to achieve some of our contracts.

HOTELS: What are your plans and goals as far as growing the company?

RAWSON: We hope to grow into 10 properties in fi ve years. We're in discussions with one hotel in New York City that I can't name at this point. Otherwise, we're looking to start out on the West Coast, but we're not going to be regional. Our long-term goal is to have a collection of the same types of properties. The whole will be greater than the sum of the parts; they'll benefi t from their association because of the size of the properties. We're looking to produce above-average returns for our clients. It's less about trying to create a brand as much as it is about trying to create a collection of properties. I could see us buying another small company or merging with one. There are lots of different options out there.

HOTELS: Will you both manage and own?

RAWSON: We're looking primarily for management contracts, but we're not averse to an opportunity that, say, a separate capital company would fund. There are so many different opportunities out there. We'll look at them one-by-one, but the primary focus for the Acumen Hotel Group is management contracts.

HOTELS: Was running a management group a personal goal of yours?

RAWSON: It was a personal goal. I've worked for others for many years, and I've always wanted to be a partner and owner, and I've found a great opportunity with Mike Malone. I hope this is it. I've stayed within this arena of style of hotels my whole life, so to be able to run these independent hotels, it's a perfect fi t. It's as if it was personally written.

HOTELS: What have your many years in the hotel business taught you about how to be successful?

RAWSON: It's about being fl exible and adaptable to the market, but at the same time being true to the customer. I'm very passionate about the hotel business and the service side of it, but I'm also a businessperson, and since the '80s, the industry has changed from being completely service-oriented to now where it's real estate-based, and you have to stay on top of it. People love the hotel business, but they forget that it's a business fi rst and that you have to make money. There's no such thing as a nonprofi t business. If you run the business the right way, with knowing what's your market, who's your customer, and you build your business around that, it's like they say-if you build it, they will come. If you know who your customer is, they will come. Word-of-mouth marketing and the loyalty that grows from it spreads inwardly and outwardly throughout the organization. When you run the business the right way, you will attract good people that want to work with you and be part of a winning team.