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Innisfree Hotels Wins IHG Developer of the Year Award

Pensacola Beach Florida HotelsIn 2011, Innisfree Hotels was selected by Intercontinental Hotels Group (IHG owns 4,400 hotels under 7 brands) for developing the Holiday Inn Resort Beachfront Hotel on Pensacola Beach Florida. 

We were chosen from hundreds of hotels flying multiple brand flags.  Julian MacQueen, CEO and founder of Innisfree accepted the award at the IHG Americas Investors and Leadership Conference held on October 26th 2011 at the Palazzo Hotel in Las Vegas. 

Innisfree’s success is a remarkable accomplishment given the company’s regional focus.  Economic times are rough everywhere in America but here on the Gulf Coast multiple hurricanes and the BP Deepwater Horizon oil spill have added serious insult to America’s economic injuries.

This success can be attributed to the tenacity of Innisfree’s founder, CEO Julian MacQueen.  His story, and the story of Innisfree, is a tale that rivals even the best rags to riches American dream dramas.  Julian’s first hotel job was as a busboy in a resort hotel in Destin, Florida.  He hitchhiked to the interview and says, “I used my ‘yes sirs’ and ‘no sirs’ a lot and was hired because I was polite.  I lived in a horrible storage room that served as staff housing, but that didn’t matter because there was little time for sleep. Hotels Pensacola Beach

When he graduated from college, financial circumstances dictated that he turn down a graduate school acceptance in favor of a career in hotel group sales.  He climbed the Hyatt Hotel company ranks eventually leaving to secured ownership of a Family Inn Franchise in Mobile, Alabama after developing five franchises for the chain. 

Julian recalls the day he opened his first hotel.  He didn’t have enough money to hire staff and needed immediate revenue to avoid defaulting on the rent.  “The Junior Miss Pageant was on in Mobile.  I knew I could rent the rooms but couldn’t afford housekeeping staff.  Nonetheless I lit up the open sign.  When the customers came I offered them a broom and said if they wanted a room they would have to clean it first.  Basically, I made my first rent payment by convincing my initial customers to do the construction clean up.”

His entrepreneurial drive was always irresistible and in between hotel jobs he owned a hot air balloon company, imported live lobsters and Chinese Yo Yos and sold civil service prep courses door to door.  Julian learned to be a fair boss and a tough negotiator the hard way.  He was conned by an employer who was wanted by the FBI for smuggling  guns from Columbia, had a business investment loan that he personally guaranteed embezzled by his coke addicted partner, and a boss who regularly woke him up for impromptu meetings in the middle of the night.

Hotels Pensacola Beach FloridaThrough all this,  Julian’s wife Kim supported them by working evenings as a waitress in a Middle Eastern restaurant.  During the day she taught at a Montessori school so their son could attend tuition free.  Kim says, “Back the we didn’t even own a pot large enough to cook a lobster and we still own 95,000 Chinese Yo Yos in a warehouse somewhere.”  She recalls listening to the rat traps go off all night in their dingy apartment and selling Julian’s inherited parent’s silver to buy Christmas presents.

The story of the Holiday Inn Resort starts in 1994 when Julian bought a ramshackle Pensacola Beach hotel called the Beachside Resort on a handshake.  Harlan Butler, Innisfree President says, “There was a sign above the front desk on a piece of painted plywood that read, “Stay at your own risk by order of the Florida Fire Marshall.  There were plastic beer pitchers in the bar with customer’s names on them.  The hotel was as rough as it gets.”

Innisfree rebuilt and reopened the Beachside Resort in June of 1995.  In August hurricane Erin hit.  The hotel sustained damage but survived.  Less then two months later hurricane Opal arrived.  Harlan says, “The first floor of the hotel was swept away and replaced with a sand dune.  We found microwaves clear across the street.”  Julian recalls standing in the debris looking for the swimming pool.   The hotel was closed for six months.

In September 2004, Hurricane Ivan devastated Pensacola Beach.  At its peak it was the size of the state of Texas.  Jeff Townsend, Innisfree’s President of Development says, “We had our best sales ever the day before Ivan arrived.  Ivan closed almost all the hotels on Pensacola Beach – three of them never opened again including the Beachside Resort.” Pensacola Beach Hotels

Innisfree lost seven hotels to Ivan and was forced to lay off four hundred people.  Harlan says,  “The worse day of my thirty day career was letting those people go.  The first hotel to reopen was the Hilton Gulf Front on Pensacola Beach.  The Island Authority used our banquet corridor as a temporary headquarters for the relief effort.  Julian fed relief workers three meals a day for a month.”  Jeff says, “We learned a lot about insurance after the storm.  We worked on that claim until 2009.”

Julian and his team cleaned up the debris and decided to build an Embassy Suites hotel on the site.  They planned an extravagant development with biggest convention center on the beach.  However, the plan was derailed by a shifting real estate market.  Jeff says,  “We knew we had the wrong product and decided to target the family oriented leisure market.  We needed to be efficient.”  So in 2007, when the Holiday Inn franchise became available, Innisfree locked it up.

This decision coincided with a move by Holiday Inn to improve their brand image.  IHG had recently spent over a million dollars to clean up its image.  Jeff says, “Holiday Inn was willing to invest in their image so we were willing to invest in their brand.”  IHG decided to seize a market opportunity to develop a higher end Holiday Inn flag and created the Holiday Inn Resort brand.  The property on Pensacola Beach was the first new construction hotel to fly this flag.

Pensacola Beach HotelsThe design for the new hotel was complete by the spring of 2008.  Jeff says, “We secured permits during the summer and got a commitment letter for financing from a regional bank in the fall.”  However, a banking crisis was looming and the bank rescinded their offer.  Jeff says, “It was horrible.  We’d invested so much.  It could’ve killed Innisfree by Julian’s tenacity saved us.”

Julian visited forty-nine banks in search of alternate financing and got forty-nine rejections.  Then he heard a rumor that Pen Air Federal Credit Union had closed a business load.  Jeff says, “This seemed extraordinary.  Credit unions usually focus on consumer lending.”  However, the rumor proved true and Julian sold Pen Air on the project.  A short time later, he serendipitously found himself seated beside Debbie Calder, Senior Vice President at Navy Federal Credit Union, at a luncheon.  He eventually secured Navy Federal’s participation as well.

In March 2009, Julian convinced Superior Bank in Birmingham to lead the load with the participation of the credit unions.  Exuberance and optimism soared at Innisfree and then quickly came crashing down when their general contractor lost their bonding capacity.  Jeff says, “We were three weeks away from closing the most difficult load we’d ever obtained and now suddenly we didn’t have a contractor.”

In July, Innisfree finally closed a $38 million dollar development load to build the Holiday Inn Resort and signed a $21 million dollar contract with contractors Robbins and Morton.  Jeff says, “The first day we met Robbins and Morton I said, we are going to build this hotel for $19,750,000.  They didn’t believe we could do it for so little.  Construction began in August.  The Holiday Inn Resort opened on February 25th on budget.

Jeff says, “Winning this award is recognition from International Hotel Group, a company that deals with thousands of hotel developers that the principals underlying our work are sound.  Our developments on Pensacola Beach have incrementally deepened the market, spurring economic development,  during the last decade.  In 2000, the RevPAR (revenue available per room) on Pensacola Beach was $50.  Ten years later it doubled and in big part because of our developments.  This level of success is off the charts.”

Harlan attributes the company success to its’ leader.  When asked how the company could possibly survive and thrive in the face of economic crisis and numerous climatic disasters he says bluntly, “Julian is how we survive.  He was baptized by fire and provided the tenacious leadership and the courage we needed to keep going.  I think Innisfree is Julian and Kim.  He keeps us on course and she keeps him on course.  They deserve this award.”

Julian credits Innisfree’s success to his professional development team and entrepreneurial management tactics.  He says, “Our aggressive revenue management, paired with our emphasis on efficiency, productivity and excellence in service, has allowed us to continue our pattern of growth during a time when much of our competition is unable to do so.

This is all good news for the Gulf Coast region, which is benefiting greatly from the job creation spurred by Innisfree developments.