WASHINGTON, D.C.—Paul Whetsell never set out for a career in the hotel business. The current president and CEO of Loews Hotels & Resorts backed into it—and, just as quickly, literally almost was beaten out of it.
He was a student back then, attending Davidson College just north of Charlotte, North Carolina. Come summers he typically worked various construction jobs until after his junior year the urge struck to try something different. Whetsell wanted to fight forest fires in the Alaskan frontier, much to his parent’s dismay. But much to their liking, the snow lingered longer than normal that season, so Whetsell returned to Charlotte and was left scrambling.
One of the few jobs left? A low-level position at the Golden Eagle Motor Inn.
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Whetsell accepted and was quickly shoved into the deep end, assigned to work the front desk during a major race weekend that drew in thousands to nearby Charlotte Motor Speedway.
“They said, ‘You started on a good day. … You’re not going to have to do hardly anything,’” he recalled during an on-stage interview at last month’s Bisnow Lodging Investment Summit. The hotel’s rooms were oversold and already occupied, meaning Whetsell’s primary responsibility was to turn away would-be guests with or without reservations.
The first visitor who walked in was also one of the largest men the green hotelier had ever seen. “He was 6 feet, 5 inches tall, weighed 300 pounds and had cigarettes rolled up in his sleeve,” Whetsell recalled with a laugh.
After he informed the guest there were no rooms left at the inn, the giant reached across the desk, grabbed Whetsell by his necktie and slammed his head onto the counter.
At that point, “I’m reaching for any key I can find to give him,” the CEO laughed. Surprisingly, he also stuck around for the remainder of the summer and throughout his senior year.
“I got the bug there,” Whetsell said. “But when I was graduating from Davidson, the owner who owned 10 of these hotels asked me to stay and get into their management program. And I thought, ‘There’s no way. I just went to Davidson, a good school. I’m not going to be in the hotel business.’”
But fate had other plans.
“I came to Washington (looking for a job but), there was a freeze on hiring, and I ended up back in the hotel business. And that’s where I stayed.”
A star is born
By the time he was 30, Whetsell decided to slide into the driver’s seat. “I was sort of on cruise control until that point,” he said.
Already exposed to operations, he launched his own management company.
The timing could not have been better, he said. The 1980s savings-and-loans crisis was pushing many hoteliers to the brink, resulting in a greater volume of turnover.
“We went from three hotels to 10 to 50 to 60 in pure management,” Whetsell said.
“Then we made a little bit of a right turn in the early ’90s,” he said. While management contracts helped push his fledgling company out of the nest, the real value was in real estate. So during 1994 Whetsell partnered with New York-based Oakhill Capital Partners. They gave him $50 million to start an owned portfolio. “I thought, ‘Man, we just hit the motherload here.’”
He turned that $50 million into 12 assets, and two years later he took CapStar Hotel Company public. The venture was one of the largest owners in the hotel industry with 110 hotels at its peak.
Talking Tisch
Whetsell would eventually bow out of CapStar to share his expertise and experience in various other capacities, including a role on the board at Virgin Hotels.
His most recent (and current job) is president and CEO of Loews Hotels, a position he has occupied since January 2012.
Industry pundits speculated Whetsell was brought in to build up the Loews platform only to sell it.
“I know there’s no appetite at (parent company) Loews Corporation to sell the company. We’re growing a company to sustain Loews over generations,” Whetsell said.
That long-term focus is a trademark of the Tisch family, which holds the controlling interest in Loews Corporation and subsidiaries CNA Financial, Diamond Offshore Drilling, Boardwalk Pipeline Partners, HighMount Exploration and Loews Hotels & Resorts.
The most recognizable face in that empire is Jonathan Tisch, the outspoken chairman of Loews Hotels and co-chairman of Loews Corporation.
“Jon has a remarkable ability to capture things and put it in writing or speeches and so forth,” Whetsell said. “But he’s an introvert offstage.”
And while Tisch occupies much of the spotlight in the hotel industry, the entire family is passionately engaged, Whetsell said, adding they will continue to be in the future.
That’s part of the reason Whetsell was hired. For years, Loews Hotels was a conservative company with a conservative outlook. Whetsell said he was never scared of Loews when he was competing against them at CapStar. They were no Marriott International, he said.
“(Marriott) goes after you. They go after your business. We didn’t see that at Loews. I wanted to change that. I wanted people to worry when we come into a market,” he said of his more aggressive approach.
While Loews’ excellent service culture remains a hallmark of the brand, now Whetsell is also focusing heavily on operations. “I keep hammering earnings before interest, taxes, depreciation and amortization,” he said.
He’s also taking Loews into new markets, including Chicago, Boston, Washington, D.C. and Los Angeles.
The only one that has alluded him 15 months into his tenure is San Francisco. That market could still come—as could major metropolitans outside of the United States, the CEO said.
“I think we have unlimited ability now to expand into different markets internationally,” he said.
That’s a long way from a tiny roadside inn in Charlotte. But just like any plan, Whetsell explained, “you have to modify it and adapt it over time.”