HONOLULU -- Marc Resorts Hawaii is on a mission to re-invent
The hotel management firm has been known among travel agents and
consumers "as a low-cost operator," according to chief executive
officer Matt Delaney.
Delaney, who took over Marc just over a year ago, wants to
change all that.
"Is this a turnaround job? Definitely," said Delaney. "We are
improving the relationship with our hotel owners so we can upgrade
the properties, and we want to improve our relationship with our
travel partners and customers."
Delaney said until he took over and cleaned house -- he fired
nearly an entire staff and hired 10 new people -- service levels at
the company's hotels were all over the map, many of the properties
were in a declining physical state and nightly rates were in the
Now rates are up 17% through July compared with the same period
last year, the company added three new properties for a total of
20, renovations are in the works at three properties and the
company is retraining its hotel staff to have a more
service-oriented approach, according to Delaney.
But even though Marc is changing its ways, old perceptions
"I know the Marc properties, but we don't sell them because they
don't have a good reputation with our clients," said Mark Thomas,
owner of the Travel Shop in Portland, Ore.
"Clients in the past would come back with complaints that the
hotels were not well kept."
Upon hearing that Marc is turning over a new leaf, Thomas said
the company "will have to pour a lot of money into its properties
to update them, which will be a huge undertaking. And it's going to
take a lot of effort to train all their employees."
But, according to Marc executives, the company is already moving
in that direction.
New properties at Marc include the Emmalani Court in Princeville
on Kauai, the Maui Ocean Front Inn in Kihei and the Diamond Head
Beach Hotel in Kapiolani Park on Oahu.
The Diamond Head Beach Hotel, which Marc has managed since
March, is getting a "top-to-bottom" renovation that should be
finished by next spring.
A renovation at the Waikiki Marc should be completed in
November, and the Island Colony-A Marc Suite in Waikiki is getting
new elevators and a makeover to its lobby, also by next spring.
Marc's latest addition in June, the Maui Ocean Front Inn, completed
a $6 million renovation last March.
Vice president of sales and marketing Anthony Stone said the old
Marc management was aiming for low rates and high occupancy, a
strategy that did not allow the property owners enough downtime to
upgrade the condominiums and hotels on a regular basis.
Now the company is aiming for better service, better product and
higher rates, a strategy Marc executives said they hope will
increase profits yet ease up on the wear and tear that comes with
high occupancy levels.
"Given that two-thirds of our inventory is condominium units,
our guests stay for a longer time," said Stone. "Just getting our
staff to smile and say, 'aloha' to our guests makes a big
difference. These are the kinds of fundamental changes we are
Delaney agrees the service level of the properties had to be
"In the past, when a guest would say, for example, 'Can I a have
an extra blanket,' the answer would be 'We don't have one,' " said
Delaney. "And that answer would vary from property to property.
"Our properties are nowhere near the Four Seasons quality, but
there's no reason we can't have Four Seasons service," Delaney
In addition to getting service levels up and renovating
properties, Marc will continue to add properties, probably two to
three a year, he said.
"Our growth will be selective, we're venturing into the boutique
area," said Delaney.
Marc Resorts has been in Hawaii since 1987, but was bought by
Sunterra Corp. in 1997.
Sunterra, a company that operates time-share resorts around the
world, filed for Chapter 11 bankruptcy protection in May 2000.
"The bankruptcy filing was one of the reasons I came out to
manage Marc," said Delaney.
"The strategy was that Marc would be a profitable, stand-alone
company if Sunterra had to go into Chapter 7 bankruptcy and
liquidate. So whatever direction Sunterra goes in, Marc will be
Delaney said Sunterra recently received some financing and
should emerge from Chapter 11 by the end of the year.
Although Sunterra operates time-share products, only two of
Marc's properties -- the Embassy Vacation Resort at Kaanapali and
the Embassy Vacation Resort at Poipu Point on Maui -- have
time-share product mixed with hotel product.
Delaney said in the past, those two time-share products
affiliated with Marc were what kept Marc profitable.
Take those two properties out of the equation and the company's
core hotel product was losing money.
"From December of last year through April of this year our core
hotel product was very profitable, but because of the economy
slowing down, it's affecting us, especially in Waikiki," said
Stone, who is in charge of sales, wants travel agents like Mark
Thomas to know the company is indeed on a turnaround mission.
"We want travel agents to know that only good things are going
to happen from their recommendations to their clients," he