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Business and lifeVolume 8 i s sue 1
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The IntervIew
J A N U A R Y 2 0 0 9Business & LifeIRISH ENTREPRENEUR 30 J A N U A R Y 2 0 0 9 IRISH ENTREPRENEUR 31Business & Life
Hotel ier
Cover Story
ust two months after 9/11, John Fitzpatrick’s newest hotel in Chicago was undergoing a full renovation. His two hotels in New York were down thirty to forty percent in occupancy after the Trade Center attacks, and businesses everywhere were bleeding.
“It was a disastrous time for me,” says Fitzpatrick, CEO of the Fitzpatrick Hotel Group in New York, the first Irish-owned hotel company in America. “If I have to say, in both my career and my life.” His father had just passed away and he was up to his neck both financially and emotionally.
The strain was so great that it was nearly impossible to see the right thing to do. Influential friends were telling him to sell Chicago, advising him to get out from under it before it took him down. But he couldn’t shake the words of his father, his hero in business and in life:
“He would say “we never sell”. We always buy - unless you’re taking a big profit”. Still, sometimes you doubt yourself and say ‘God, have I lost it? Have I lost the edge? It was a tough time“
In 1991 he opened his first hotel in New York, The Fitzpatrick Manhattan. By 1999, his portfolio expanded to three thriving hotels in New York, and Fitzpatrick had made such a name for himself that Crain’s New York Business named him to their list of “Top Forty Entrepreneurs Under Forty”. Irish America Magazine recognised him as one of their “Top 100 Irish Americans in Business” in 1998, and then again in 2008. He was a recipient of the Ellis Island Medal of Honor in May 2002. Previous honorees include George Bush, Bill Clinton, Rudy Giuliani, several Nobel Laureates, and other distinguished leaders.
"We fought through some tough times, and the Chicago property turned a corner and boomed like everywhere else." Fitzpatrick says. "Shortly afterwards, we got an irresistible offer." According to sources, the 140-room hotel, which Fitzpatrick
Hard timeS Come again no more
Hotelier John Fitzpatrick talks frankly to irish entrepreneur and says that optimism is the key to overcoming the tough era in which we live
By Jody JenkinS
“Obama’s chOice oF HiS Friend Hillary Clinton For
SeCretary oF State iS a douBle viCtory For ireland”
J A N U A R Y 2 0 0 9Business & LifeIRISH ENTREPRENEUR 32 J A N U A R Y 2 0 0 9 IRISH ENTREPRENEUR Business & Life 33
bought for $21.4m (€15.9 million) in 2001, sold for an estimated $35.5 million (€26.5 million) in 2006. Fitzpatrick added, “It was a tough decision to sell, but I thought this was an opportunity to use the profit to purchase the remaining shares of the New York Hotels from my family and be the sole owner of two fine Midtown hotels.” Since then, Fitzpatrick has also re-invested over $11 million in both his New York Hotels and just finished a complete redesign of the Fitzpatrick Manhattan, giving it a total new look.
Fitzpatrick is the son of legendary hotelier Paddy Fitzpatrick. The senior Fitzpatrick had a long and distinguished career, managing hotels in Ennis, Wexford, and Dublin before buying his first hotel, the Fitzpatrick Castle at Killiney, in 1970. As a result, Fitzpatrick and his siblings practically grew up in the hotel business. His father insisted that all his children learn from the bottom up. “You need to know the intricacies of every single department, because if we ever go bankrupt, God forbid, you’ll can always make a good headwaiter” the senior Fitzpatrick said to his son half jokingly.
Fitzpatrick’s philosophy is simple. Keep focused when you’re on your heels because there’s opportunity in everything, even during tough times. Optimism is the key. Which is why he thinks what’s going on in Washington now is so crucial for Ireland and the world.
“I really think that Barrack Obama being president will be fantastic,” Fitzpatrick says from his office on Lexington Avenue in New York, headquarters of the Fitzpatrick Hotel Group, which has now been a fixture in the US for 18 years. “It’ll open up doors to global markets. You know the United States has not enjoyed a good image over the last few years due to recent policies. I think the change in direction will be very positive for the United States and for the whole world.”
Fitzpatrick believes that Obama’s choice of his friend Hillary Clinton for Secretary of State is a double victory for Ireland, as it will help keep Irish issues front and center with Ireland’s second-largest trading partner.
“I think that’s a great move and I’m
delighted she took it,” says Fitzpatrick, who knows the Clintons personally. He and Declan Kelly, another prominent Irish supporter of the Clintons, even played a round of golf in very wet conditions at Portmarnock with Bill during a $400,000 (€285,700) fundraising tour of Ireland for Hillary’s Presidential bid.
“She knows all the players,” Fitzpatrick says, clearly pleased with Barrack Obama’s efforts to bring all the best talent to bear in his government. “And from an Irish point of view, we still have a friend in the White House. And that’s very important.”
This past October, he received his highest honor, an honorary OBE in recognition of his charitable work contributing to peace in Northern Ireland. “I have to say, unless you were there …,” Fitzpatrick says, still sounding somewhat awed by the experience. “To be a part of such a time-honored ritual was a bit
overwhelming and quite humbling. The ambassador himself presents the award to you, complete with the red carpet and the guys in traditional uniforms with the swords and everything else.”
It’s the personal touch that Fitzpatrick has mastered that sets his hotels apart. Like his father, Paddy, he insists that his managers greet guests in person. And because Fitzpatrick leads by example with a personal style that is both self-deprecating and relentless in his pursuit of excellence, it brings out the best in others. “He’s a great guy to work for,” confides an employee.
US InvestmentFitzpatrick estimates that 30% of the business in his two New York locations (the Fitzpatrick Grand Central on East 44th Street and the Fitzpatrick Manhattan Hotel on Lexington Avenue) comes from Ireland. And he has a high percentage of repeat customers. He believes that the key to his success is taking care of the regular guests, whether they are here for business or pleasure. “People want to be recognized. Treat them well, learn what is important to
them, and they will support you in good times as well as bad,” said Fitzpatrick.
Fitzpatrick believes that the most critical element to helping Irish entrepreneurs get through this economy is to get the United States back on track. As Ireland’s number two export market behind the United Kingdom, and her number one foreign investor, the US is essential to Irish economic success. “So the number one priority has to be getting the country going economically,” he says.
“Ireland enjoyed such a fantastic ten year run” Fitzpatrick says, remembering trips home to Ireland during the years following September 11th. “New York hotels were struggling hard to work out single–digit revenue increases, year over year, and watching Ireland turn double-digit growth was way ahead of anybody’s dreams.”
But now that Ireland has fallen back to earth, Fitzpatrick stresses the number
one mantra his father taught him: Optimism. “I was in Dublin recently, and the mood was somber …,” he says. “Everybody
was acting as if they were at a funeral. Not that it’s not that bad, but I think we’ve got to start talking positive otherwise we’ll never come out of it.”
Surviving the stormFitzpatrick said Irish business would do well in this economy to keep a level head, manage costs responsibly, and ride out the storm: “As they say, ‘Cash is king.’ That’s been my slogan for the past few months. Just hold on to as much of it as you can, and there will be opportunities once we ride this storm out.” Fitzpatrick pointed out that he was able to expand into New York during the recession following the Gulf War, a move that has worked out well.
Staying lean and keeping focused with an eye on the horizon for opportunities is the way to go. He recalls how two years ago when his rooms were full, he couldn’t think of expanding because property prices were so high. He doesn’t think the market in the US has bottomed out yet. But in another six to eight months there will be deals aplenty. And there will be opportunities for entrepreneurs wanting to break into the US market.
Hotel ier
Cover Story
“PeOPle want tO be reCogniSed. treat tHem well, learn wHat iS
important to tHem, and tHey will Support you in good timeS aS well aS Bad”
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Wednesday, January 15, 2014
This week’s blog is from Jody Jenkins, a quiet force working behind
the scenes to create local TV worth watching. Jody recently arrived in
Savannah to be a producer for SGTV…but think more than talking
heads and bickering residents though as Jody’s putting some
seriously cool stuff on the government channel! Read on as Jody
brings the Rocky Mountain Way mindset to Savannah. FYI – – The
Creative Coast’s blogspot is Savannah’s sounding board for local
thinkers, innovators, wanderers and wonderers. Guest bloggers share
their thoughts, opinions and creative noodling from all over the
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in Savannah from Boulder, Colorado to figure out what might be the
key to unleashing Savannah’s potential to emulate Boulder’s success
when it comes to startups.
Small businesses make up half of the US economy. They make up
over 95 percent of businesses in the entire country depending upon
how you define “small.” But startup connotes something of an upstart,
those brassy tech companies known for their vinegar and willingness
to take a risk – the kind of risk that pushes the business envelope and
expands the economy. They’re not simply small businesses, but small
businesses with attitude.
Boulder is the startup capital of the United States. People move there
to just to start businesses – from biotech companies such as Amgen
to organic tea maker Celestial Seasonings to Horizon Organic Dairy to
computer storage companies such as Storagetek to Ball Aerospace
and countless internet companies.
In 2010 Boulder – with a population of 100,000 (countywide
population of 300,000) – had six times as many hi tech startups as the
nation’s average and twice as many as the runner up for the title – San
Jose-Sunnyvale, California. It ranks among the top twenty most
productive metro areas in terms of GDP. All that without natural gas or
oil or any dominant industry of any kind.
According to Forbes magazine, Boulder sprouts a new startup on the
order of every 72 hours. That’s 122 new businesses for the year, which
raised a total of $502 million. How do they do it?
According to Karston Strauss of Forbes, it’s not one thing. It’s a lot of
things. But mainly, it’s lifestyle, access to education, transportation
infrastructure – which makes it easy for twenty somethings with ideas
to get around without cars – and low costs. Strauss’ article takes it as
a given that there’s a healthy supply of cash around from venture
capitalists cruising the waters looking for the next big thing.
Savannah has a lot of the same qualities as Boulder. We have a
ripened and growing culture of ideas. There is enormous creative
energy swirling around out there and a significant amount of it comes
from SCAD with its interesting mix of cultures, ideas and the creative
arts it nurtures. But that mix also includes the film industry, Hunter,
Savannah State, Gulfstream, Georgia Tech, Armstrong, the Port and
many others.
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Boulder has a large federal presence of a type that we lack through
the University of Colorado, the National Center for Atmospheric
Research, the National Institutes of Standards and Technology, the
National Renewable Energy Lab (researching new and renewable
energy sources) and others, all of which provide well-paying jobs that
helps seed the NewTech idea economy. Savannah has the port and
the heavy influence of federal dollars through Fort Stewart and
Hunter, but that money isn’t going into research or the idea economy
– an idea economy such as research and technology that can lead to
NewTech job creation. But we don’t have to be a perfect mirror.
We, like Boulder, have a beautiful city surrounded by great natural
beauty that translates into the question of lifestyle: Boulder is nestled
right up against the Rocky Mountains and attracts a lot of people who
are physical and business risk takers – very often they are one and
the same. Boulder is a haven for bikers, hikers, skiers, triathletes,
kayakers and extreme athletes of all sorts who come to test
themselves against the physical majesty of the mountains. Savannah
has a history like few other cities in America, stunning physical beauty,
the marshes, and the vast expanse of the ocean for kayaking, surfing,
sailing, fishing and other sports. We have runners galore and the
Rock-n-Roll Marathon and numerous other such events. We recently
became a Bike Friendly City USA, which means we’re on a forward-
thinking path about alternative transportation that, while slow, is
progressing. We have a lifestyle and quality of life that many would
envy. It’s not perfect, but it is certainly maturing.
The question is how can we tap into the potential stirring in this town
to draw in the money and know how to launch ourselves on an
entirely new path that translates into creative business? How do we
become a startup upstart that might one day rival Boulder’s
reputation? It’s a question the city itself is looking in the eye and trying
to find ways to answer.
Recently Greg Parker of the Mayor’s Business Roundtable gave a
frank presentation about the need for the city to be more sensitive
and responsive to business needs in order create a more vibrant
economic atmosphere. Parker used Forbes’ list of most business
friendly cities in America, on which Savannah ranks 124th, as the
centerpiece around which he built a call for a leaner, meaner city
government, hungry to change the business culture with an emphasis
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on ‘customer service.’
He said the city needs to revamp its approach to serving businesses
so they can better get on with the business of business, which is
making money, creating jobs and improving the economy for all of us.
He called on government to streamline, simplify, become more
nimble at its job and then step out of the economic way. The
presentation was a call for Savannah to shed its old reputation of
being business unfriendly, which is exactly what the city is taking
pains to do and why the Roundtable even exists.
It’s recognition that in a new, post-crash economy you’ve got to be
lean to take on the competition. Which is why it’s encouraging that the
city didn’t wait for the Rountable before quietly revamping
government in ways that anticipated the Roundtable conclusions: The
city has already instituted an eTRAC system, which allows for
electronic tracking of permits or plans, requesting inspections and
making electronic payments. And it has already created what Parker
called a “Sherpa” position, a single person whose aim it is to lead
businesspeople through the processes of government and make it
easier for them to start up and to one-stop shop. It’s not drive through
service, but it’s a beginning.
The City of Savannah has also created the position of Sustainability
Coordinator, in recognition of the idea that sound building practices
using the latest technologies not only save energy and promote
conservation in other areas, but also is simply a good idea whose time
has come. And it’s a reflection of a community that in many respects
is beginning to blaze a trail into the future.
These initiatives follow SCAD’s creation of a Design for Sustainability
program that is bursting with ideas about how to improve the
economy and the quality of life here. Part of sustainability’s premise is
to create businesses based on circular models to sustain themselves
– in a sense breaking out of the old exploitative grow-or-die mode of
thinking that has dominated business and evolving into a more “living
within our means” approach. Southern Pine, a wood reclamation
company in Savannah, is one example of how such models work. And
groups such as Emergent Structures and the Volta Collaborative are
providing the brainpower and working models to feed the growing
appetite for alternatives to the old ways of doing business.
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Sustainability has a decidedly green element premised on finding
business solutions that minimize or even eliminate impacts on the
environment. And an integral part of sustainability is providing
living-wage jobs that will pull people out of Savannah’s large poverty
fringe, creating viable futures for people who then give back to the
community.
These new paradigms are the currency of the 21st Century startup
economies that Boulder inhabits. Savannah is a city with a
sustainability program, where possibilities such as solar and wind
power alternative may soon become a reality. It has a growing food
movement as evidenced by community gardens, organic garden to
table restaurants, a great farmer’s market with others sprouting up,
and a growing choice of food stores. It’s a city where catchphrases
such as sustainable business, sustainable living and sustainable jobs
are part of the language of life. It’s a world where the environment is
central to our consciousness.
A persistent barrier to spawning business in Savannah is capital. The
Boulder/Denver area is a venture capital haven. Naturally, where
there are startups with potential futures, there will be people to invest
in them. And while Savannah doesn’t have the wealth of a Denver to
draw upon, it has groups like the Angel investors that can serve as
examples. But there is clearly a dearth of funding to lay the
groundwork for what Albert George, the founder of the Savannah
Green Economy Summit, called “The Silicon Marsh.” Simply the fact
that Savannah HAS a Green Economy Summit speaks volumes about
where we’re heading.
But perhaps in order to make this new paradigm viable,
considerations needs to be given to building a consortium of banks
and businesses and individual investors that could pool funds for risk
capital that those entrepreneurs already here and those that might
come here to start new ventures could draw upon to surf this new
wave. We need more adventurous venture capital. And we need city
policies that not only encourage potential startups and other
energetic small business to locate to Savannah, but actively recruits
them in the same way we actively recruit big businesses, by offering
tax breaks, incentives, and programs that help them get on their feet.
Which brings us to another important point that Greg Parker of the
Roundtable addressed in his talk to the City Council in mid December:
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The big sell. If we’re going to do and be all these things, to realize our
highest hopes and aspirations, we have to shout it from the rooftops.
We have to let it be known that we’re playing for real by advertising
that fact far and wide. We have to begin touting Savannah as a place
where good things happen.
Perhaps by taking the steps necessary to position the city to make a
run at the top of Forbes’ list of America’s Most Business Friendly
Cities, by walking the walk, we can back up the talk when we talk it.
It’s an exciting prospect, perhaps something akin to being a startup.
On my desk sits a small square hunk of metal given to me years ago
as an anonymous Christmas present. Embossed into it is a question
that I ponder nearly every day. It reads, “What would you attempt to
do if you knew you couldn’t fail?” It seems at this opportune juncture a
good question for Savannah. And it seems there is no way to lose if
we embrace a new vision. And places like Boulder serve as stirring
examples of just the kind of future we might attain if we do.
Jody
Jody Jenkins
Jody Jenkins is a producer for SGTV, Savannah Government
Television. He has been a journalist and filmmaker for thirty years
and was a Ted Scripps Fellow at the Center for Environmental
Journalism at the University of Colorado in Boulder, in 2011-12.
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JUNE 2009 21IRISH ENTREPRENEURBusiness & Life20 IRISH ENTREPRENEUR JUNE 2009Business & Life
SNAPSHOT
The Enda time
t was a differentworldback in September 2008 when the Irish Entrepreneur first talked toEnda O’Coineen about his bringing the Volvo around the worldOcean Race to Galway: We were all still basking in the warmth ofyears of sweet success and excess, living the good life, not worryingfor the future because we truly believed that it was ours. And witha long history of privation behind us, there was a certain nouveauriche pride in Dublin being the most expensive capitol in Europe. Ifyou could make it here, you could make it anywhere.
Construction cranes dotted the new glass skyline. The cars. Thehouses. The hi tech. Pearl cufflinks and a satisfied glance in themirror before a night out at Patrick Guilbaud’s. All signs we hadfinally shed our humble past and could proudly strut the stage withall comers. And the Volvo Ocean Race was just another reminderthat we were full-fledged members of the modern world. And, well,quite frankly, we deserved it.
What a difference nine months make. The shock and awe ofstock market crashes slow rolling tsunami-like around the globelittered every shore and we rudely discovered instead of beingimmune to history, we’d been humbled by our own hubris. Andwhen we got through the denial and the self-pity and starteddigging ourselves out of the mess, men like Enda O’Coineen cameto mind.
It’s fitting that someone who knows the fear and bitter taste of thestruggle to survive show us a way into the future: After capsizing a16-foot dingy trying to cross an ocean with a supply of Heinz bakedbeans, he spent the night fighting for his life in the freezing, storm-tossed waters of the Atlantic. And the Volvo Ocean Race and otherinternational events like it could just be a way to start piecing thecountry back together again.
When the racing teams arrive in Galway port on the 23rd and24th of May, the docks, which are usually filled with small fishingtrawlers and yachts, will be covered with a Race Village featuringfood and wine fairs, exhibits, live music, street theater and a massivefireworks display. An estimated 140,000 people are expected toattend the two-week event and the knock-on effect is an estimated€43 million injection into the economy of Western Ireland. For atwo-week event, that’s a pretty impressive take.
Economic escape clauses are few in Ireland at the moment. Itwill take independent and creative entrepreneurs like O’Coineen toturn visionary ideas into solutions necessitated by the times. Andperhaps with their help, as bold as it may seem now, one day soonwe just might find ourselves hosting the summer Olympics. ■■
P H O T O G R A P H B Y COLM HENRY
I