At the August 12 Rotary Club of San Antonio luncheon, Richard Slutter, vice president of operations for Zachry Hotels, traced the line from the Hilton Palacio del Rio to the company's newest property, the Monarch at Hemisfair, and made the case for why downtown needed another hotel. He was preceded by returning Rotary Youth Exchange student Jonah Nirenberg, who spoke about a year spent in rural Japan.
Slutter has spent two decades in hospitality and moved thirteen times over that career. He has been in San Antonio about a year and a half, and belonged to three Rotary clubs before this one, in Philadelphia, Norfolk, and Rockwall.
His talk covered three things: the history that produced the Monarch, the numbers behind downtown's hotel market, and how the property has performed since opening.
From the Palacio del Rio to the Monarch
Zachry Hotels is the smallest line of business at Zachry, a company better known for roads, quarries, and construction, but it employs roughly 1,300 people in San Antonio and runs four Hilton-flagged properties: the Palacio del Rio, the Embassy Suites Landmark, the Embassy Suites near the airport, and now the Monarch. The connection to Hilton is old. H.B. Zachry and Conrad Hilton were contemporaries who became friends, and the companies' values lined up. Zachry's credo — every person matters, together we can do great things, this is more than a job — still runs across all its business lines.
The Palacio del Rio is the reason the Monarch exists. In 1967, with the World's Fair less than a year out, the city discovered it had inadequate lodging downtown next to Hemisfair. Zachry was a builder, not a hotel developer, but H.B. Zachry said he could deliver a 500-room hotel in 202 days from groundbreaking to first guest. He did it with modular construction, assembling finished rooms by crane. Riverwalk boat guides still call it the Lego-built hotel. It remains the longest individually owned and operated Hilton in the world, and Slutter said the company is negotiating a franchise agreement that would carry it to a hundred consecutive years under contract, a first for Hilton.
The company's current CEO, David Zachry, was six years old when that hotel opened and walked in as its second guest, behind his grandmother. Slutter said the earliest internal email the company can find on the subject dates to 2005, when Zachry wrote that if the land across the street ever became available, he would like to build there. It took twenty-one years.
Does Downtown Need Another Hotel?
On whether downtown needs another hotel, Slutter argued San Antonio's market differs from its Texas peers. It is far more leisure- and convention-driven, most of its visitors come from within Texas, and it lacks both the convention capacity Houston, Austin, and Dallas are building and their Fortune 500 corporate travel base. What it has, by his figures, is 39.2 million annual visitors, $23.4 billion in tourism spending — first in the state — and 150,000 downtown hospitality jobs. The gap he pointed to is at the top of the market: only about 8 percent of downtown San Antonio hotel rooms sit at luxury or upper-upscale level, against roughly 25 percent in Houston, 20 percent in Austin, and 17 percent in Dallas.
The Monarch opened into that gap as part of Hilton's Curio Collection, one of 262 worldwide. Through its first five months, Slutter said, it ranked third in the world among Curio properties for guest service and first for cleanliness.
Jonah Nirenberg: A Year in Rural Japan
Earlier in the meeting, high school student Jonah Nirenberg described the year he spent on a Rotary Youth Exchange in a rural Japanese town of fewer than 10,000 people, attending a public school where no classes but English were taught in English. He had done RYLA the winter before leaving. The daughter of his host family spent the same year in San Antonio.
He said the advice he had been given at RYLA and other Rotary events was to say yes to unfamiliar things, so he joined a basketball club despite never having played. He described the exchange as a place he was supposed to fail — and did, repeatedly, trying to speak Japanese — which became the subject of one of his college essays.
Nirenberg named three things he brought home: independence, from managing his own problems in an unfamiliar country; connection, including a habit of mailing postcards and letters, which he said carries more weight than a text; and perspective. He is on his way to George Washington University, and noted this was the first speech he had given in English since returning.
