BusinessTN

A well-known industry power player, Memphis-based Davidson Hotels is the sixth-largest independent hotel management company in the United States, and this year, in terms of growth, the company has also been one of the most active in the industry. So far this year, Davidson has acquired three new hotels and signed management contracts for four others. And according to John Belden, Davidson's president and CEO, the company is looking to add a couple more hotels to its portfolio before year-end.

Davidson's joint venture acquisitions include the 259-room Sheraton Suites Tampa Airport/West Shore in Florida (which will soon undergo a $14 million renovation) and the 193-room Hyatt Regency Suites in Palm Springs, Calif. (slated for an $18 million renovation). Davidson also purchased a 234-room Sheraton on the University of Iowa campus with Ohio-based RockBridge Capital. The company hopes to complete a $12 million renovation by the beginning of the 2009 school year.

"Part of our strategy is to own and operate University-related hotels," Belden says. "We have six that meet that criteria, and they've been very profitable ventures. They are recession-resistant and put us in close proximity to strong, young talent from universities. So, not only can we populate the work force of the hotel with students, but we can also capture them early in their career aspirations and bring them into the lodging business."

But owning and operating hotels that derive most of their business from university campuses is not Davidson's only growth strategy. In the 1990s, the company shifted its focus from small, mid-scale hotels in the Southeast to more upscale, high three-star and four-star assets in larger markets nationwide. First under then-owner Wilton D. "Chick" Hill, and now under Belden and his senior management team, that's a strategy that has paid off. Davidson's portfolio represents 34 properties, with year-end revenues approaching $500 million.