Small adjustments, big results: Greenville’s Aileron Management charting a course through Covid
By Rick Spruill
Photo Courtesy Aileron Management
As Covid-19 deals devastating blows to some of the world’s largest hotel chains, Jason Boehm’s Greenville-based hotel management company, Aileron, has found a way through.
Not that it has been pain-free. Aileron, which manages four hotel properties in Wisconsin, Iowa and South Carolina, endured its own share of turbulence as quarantines took effect and hotel occupancy rates plummeted.
“We were able to make it through 2020 without layoffs,” Boehm said of the company that has five employees in Greenville and dozens more in other states. “We did have furloughs but were able to maintain insurance for those who couldn’t pay premiums.”
Hotels measure performance in terms of “RevPAR” (Revenues per Available Room) and Boehm, an Alabama native, Bob Jones University graduate and CPA, remembers when, in the throes of the Great Recession, RevPAR dropped 20% from 2008 to 2009 – his first year in the hotel business.
Fast-forward to 2020.
“RevPAR fell 65% from 2019 numbers, industry-wide,” he said, pausing to absorb his own words.
“It’s a mind-blowing number, it really is.”
Covid-19 will cast a long shadow over the U.S. hospitality sector, according to a study of data and polling conducted by the National Hotel and Lodging Association.
According to the latest data, the NHLA estimates half of U.S. hotel rooms will remain empty in 2021, signaling a slow rebound for an industry that supports 10.5 million U.S. jobs and contributes an estimated $660 billion to America’s gross domestic product.
But, things are rebounding.
Deb Metcalf, co-owner of Travel Agents International off Woodruff Road in Greenville, said the phones started ringing in early march.
And they haven’t stopped.
“The first question people are asking is, ‘Where can I go and when can I go?’” Metcalf said. “And, every day, that answer changes.”
Metcalf said domestic travel is leading the charge.
“About 75% of our calls are for U.S. destinations,” she said.
“People are frustrated with all the hoops required of international travel,” she said. “Some are willing to take the risk. Some are not.”
And they don’t want major U.S. metro destinations, either.
“Nobody wants New York or Chicago, for example,” she said. “Most of the hotels we are booking in are in outdoor destinations.”
She said places like Wyoming, Colorado and Utah are top-of-mind right now, along with Florida, for traveling families.
Boehm said he’s witnessed, firsthand, what it’s like for hotels in major metros while on a trip to Chicago last year.
“It’s hard to see a metropolis like that where hotels are empty, kitchens are closed. It’s surreal, the gravity of it. It’s hard to put into words,” he said.
He said he’s drawn heavily on the lessons taught by the Great Recession of 2008-2009 while responding to Covid-19’s demands.
“A lot of the things I learned in that period served me in 2020,” he said. “I feel fortunate to have learned those things firsthand and have been able to lean back on it during this time.”
Boehm, whose career in the hospitality industry began with Spartanburg-based OTO Development, where he served as vice president of business development, says the relationships forged in his decade there propelled him to start something new.
“The success we enjoyed there gave me the confidence to strike out on my own.”
The timing was perfect and, with financial backing from The Lodging Fund, his vision of building a hotel management company committed to excellence in even the smallest details became a reality.
All the vision needed was a name.
“I knew what the company would do, I just didn’t know what to call it.”
The solution came on a long road trip from Greenville to the Florida Gulf Coast with his wife, Laura.
“Nothing hit me. Seriously. We were driving for hours, reading all these terms,” he said.
Finally, somewhere between Orlando and Tampa, the light bulb went on.
“Laura said ‘Aileron.’ And when I thought about it, it means ‘little wing’ in French,” Boehm remembered.
“And as I thought about that, how the pilot makes small adjustments to move what, in some cases, are extremely large aircraft, the aileron is a vital part of it. In fact, that’s where the control comes from.”
He said it’s the same for hotels.
“You’ve got these multimillion-dollar facilities, and we’re the ones adjusting the ailerons, making these small adjustments to (the facility) that help them succeed.”
“I liked the concept of that,” Boehm said. “And I liked the way it sounded. It sounded good to me.”
In November 2018, Boehm’s leadership team expanded to include Jason Poynter, Aileron’s VP of sales and marketing; Marisa Middaugh, HR manager; and Josh Slack, VP of finance.
By February 2020, they’d secured management agreements in three upscale, select service hotels.
A month later, they were sitting mostly empty.
Boehm said navigating a pandemic required adjustments and tough choices – some larger than others - as hotel occupancy rates plummeted and work dried up.
Had lenders not been patient as hotel chains struggled to service debt in the face of sagging revenues, and had the government not stepped in with emergency funding, the results would’ve been catastrophic.
“Fortunately, there was some sanity with lenders and some patience,” he said. “And that has gone a long way to stabilizing the industry. That and some government assistance.”
Instead of selling dozens of rooms each night in their properties, they were selling six or eight.
“By April (of) 2020, we were off by 95%, occupancy-wise,” he said. “It was eerie.”
Boehm said a timely pivot into homeowner’s association management, an idea that came to fruition on the cusp of Covid-19, created much-needed lift for the fledgling enterprise.
“We love HOAs. It is very complementary to hotel management,” he said.
Enter Rebecca Thompson, who joined the team as VP of association management in late 2019.
“We had the infrastructure, she had the expertise,” Boehm said. And the results are coming. Under Thompson’s leadership, the company has entered into management agreements with eight properties, the crown jewel of which is the Cliffs of Glassy, a mountaintop community less than an hour’s drive from downtown Greenville.
“We’ve grown. My team here is fantastic. I’ve got folks with decades in their respective specialties who’ve rolled up their sleeves and done what they’ve needed to do. We’re all learning.”
Now, having weathered what most assume is the worst of the pandemic, Boehm, whose office occupies one corner of the company’s open, well-appointed downtown spot, said the pandemic has forced hotels to rethink virtually every aspect of their business models.
“Covid has been an accelerator,” he said.
One area seeing immediate changes is in how properties maintain clean – and safe – spaces.
A survey of travelers shows that a hotel’s overall cleanliness and safety protocols ranks second only to the price of a room, according to an Ecolab Consumer Safety poll.
“(Covid) has accelerated how clean hotels are and should be. And I’m happy to say our hotels are highly rated in that area,” he said “We’ve won awards for cleanliness. COVID was an accelerator for us to up our game from a cleanliness and sanitary standpoint and communicate how we do that.”
Greenville’s wealth of upscale hotels will come back, too.
“We have phenomenal hotels in Greenville,” he said. “We’re very blessed, and we’re a drive-to destination for nearby major metros. As leisure travel comes back, we’ll see the rebound.”
As for lessons learned in a year of Covid-19, Boehm recounted a conversation with a budding entrepreneur who’d recently sought his advice.
“I told him, ‘Be flexible. You have no idea what opportunities are going to come. Sometimes, you take what the market gives you.’”