Longtime friend of mine, but I believe someone making his taking stock debut joins us now.
Greg Freeman, CEO of Peachtree Group.
Great to see you in person.
Thanks for taking time for the show today.
Thank you for having me.
All right, so we're going to talk about kind of hotel booking, concierge work all surrounding the FIFA World Cup.
What a fascinating conversation.
What do you see in terms of hotel booking relative to what was forecast for the World Cup so far?
So, you know, so far it's been a little bit disappointing on the booking side.
So there's high expectations when originally the World Cup was announced that it was gonna be here in the US, and we expected because we own and operate about 110 hotels across the US, so we had high expectations for the hotels that we had in the different cities where the World Cup was going to be having, you know, having different tournaments and events, and, you know, unfortunately it's been underperforming our original expectations, but it's been outperforming what we expected, you know, when we did our budget.
Just at the end of last year, so it's not necessarily all bad news.
It's actually been relatively good news with just the amount of visitors coming into the different cities like in Atlanta and some of the other markets that we own hotels where the World Cup has been having matches.
Yes, that's really interesting.
What do you attribute that maybe a bit of a mismatch to in terms of what you originally saw versus what you're seeing now?
And you mentioned Atlanta.
I wonder, are there particular markets where you're seeing outperformance relative to your original expectations?
Yes, so we're seeing, you know.
Really like in Atlanta we're seeing a lot of visitors coming internationally.
I think it's just been one of those where there hasn't been as many international visitors coming to the US just with some of the challenges with um the geopolitical environment and so forth.
So that's been a headwind associated with just getting people here in the US, but overall it's been, I would say successful just given sort of the macro events that have been happening across the world.
So like for Atlanta, for instance, you've had close to, you're gonna end up with close to 300,000.
Visitors from outside the US, you know, primarily that are coming to visit the city, and that's great publicity for that market.
It is and what a great city in Atlanta and also one of the greatest stadiums we have in North America at Mercedes.
I mean, my goodness, I mean, you and I, we're talking about, I'm not a big fan of MetLife Stadium, but man, we look at the Atlanta Falcons home and we're like, God, that's a gorgeous place to play, right?
No, that is, that is definitely the case.
Um, would you say global exposure?
I is a fair bit of a payoff here in the equation.
And what has surprised you so far as the tournament has rolled along?
Yes, I mean, global exposure from a standpoint of just like social media.
I will tell you one thing that's interesting.
You're watching a lot of these guests that are coming from out of the, you know, out of the US.
They're posting on these social media channels like there's one person I think is posting on the X named Freddie.
I'll use him as an example with, you know, Bucky's and so forth, and that's.
You know, great exposure for some of these smaller markets like Auburn, Alabama, where there's a Buc-ee's or out in Texas, so it's giving exposure to the really the secondary and tertiary markets as well.
I'm glad we got a Freddie reference here on the show because I haven't been able to figure out how to work in the Freddie sensation, and it is a sensation on social media.
I still have a lot of questions though.
I don't know.
Sometimes it's not quite square and I don't know what to make of it to the real estate, land or hospitality more broadly.
Higher interest rates maybe for longer.
How do you see that impacting the consumer and impacting booking?
Yes, so it's, you know, it's really the higher for longer interest rate environment is obviously putting pressure on the consumers, especially the K-shaped economy, as you know, it's hitting that, you know, middle tier and lower tier consumer and their ability to spend money, but the reality is, it's also creating a lot of pressure on just real estate values, so it's impacting the underlying values.
So it's a headwind to the values of like hotels and to other commercial real estate assets, and it's, you know, it's a challenge, but it also creates a huge opportunity for groups like us because we buy assets, we develop assets, we do a lot of direct lending on commercial real estate assets, so it creates a lot of opportunities for us as well.
How about the stalled housing bill?
I mean, it looked like we were going to get this thing across the finish line.
It was bipartisan until the president said it's basically, no, no, we're not going to pass.
It until the voter ID is a completely separate, separate bit of legislation passes.
How are you thinking about that legislation?
How important are any thoughts because it's a big one down in Washington.
It's, I think it's an important bill, so hopefully it does get passed.
It's, you know, it's very focused on driving supply, and that's a big part of the equation with the housing shortage, especially on the low income side, um, because we're, we're short about 7.2 million homes, um, when you think about.
Just rental homes for the low income, you know, sector, and, and so it's important for that bill to get passed, but I think that bill is just the first step towards it because we do need a lot more liquidity.
We need a lot more supply to get built, and that requires a lot more liquidity in the housing sector.
Greg Freeman, I'm always grateful for your time.
Usually you and I have to do this remote, separated by many miles.
We get to do it in person today.
The CEO of Peachtree Group, come back anytime.
It's nice to see you again.
Yes, thank you so much.
I really appreciate it.
