Archive for the ‘Washington Post’ Category

McCain And Baseball

Monday, February 4th, 2008

With all my various involvements in life, I must say that my achievement in helping to bring baseball to Washington is among my proudest.  So I was quite pleased to see the Washington Post describe me this way in its story on DC-area fundraisers for presidential candidates:

 “[W]ould-be D.C. Nationals owner Fred Malek is backing McCain.”

Yes, I wish I were among the Nationals owners.  But the team they do have on top is doing a superb job.  Almost as good a job as John McCain is doing.

Hotel Industry Opportunities Abound

Tuesday, January 15th, 2008

Interesting article in today’s Washington Post business section about Robert Johnson raising $1.2 billion for his third private-equity fund that invests in the hotel industry.

The Post ran my thoughts on what’s happening these days in the hotel industry:

Fred Malek, co-chairman of Thayer Lodging, a private-equity fund that buys and manages hotels, said now is a good time for hotel deals.

“This should be an excellent time to acquire hotels because values are coming down somewhat, some owners do not have the financial capability to upgrade their hotels to meet consumer demands and brand standards, and thus, they will be forced to consider sale,” he said.

I was also thrilled to see my wife quoted in today’s Style section – the story about Debbie Dingell’s efforts to make Michigan a prominent political player in choosing our president.  Here’s what the article said:

“She’s very involved in Michigan,” says her Republican friend Marlene Malek, with whom Dingell holds an annual bipartisan, women-only lunch during the December holiday season. “She’s always there. She’s always doing something political and not political. She has a whole other life out there.”

By the way, if you’re curious about that lunch Marlene holds with Debbie Dingell, here’s a nice write-up that appeared in the Politico’s “Shenanigans” column last month:

Wonder women

All spotted sitting at the same table during lobbyist extraordinaire Debbie Dingell and D.C. socialite/philanthropist Marlene Malek’s all ladies lunch today at the Four Seasons, hosting 300 of D.C.’s high powered ladies: Romney spokeswoman Barbara Comstock, Fred Thompson advisor Mary Matalin, wife of Sam Donaldson, Jan Smith, Tammy Haddad of Haddad Media, former head of the RIAA Hilary Rosen, MSNBC host Norah O’Donnell, lawyer and wife of Howard Fineman Amy Nathan and “Meet the Press” executive producer Betsy Fischer. Topics of conversation? Not so much politics as…Hannah Montana tickets. Also in the room of wonder women? Lynda Carter.

John McCain Wins New Hampshire

Wednesday, January 9th, 2008

I just got back from campaigning for John McCain in New Hampshire. Here’s a fun account of McCain’s victory in today’s Washington Post:

John McCain’s bus just pulled into a polling place on Broad Street, and McCain dived into the media scrum and disappeared from sight. It is possible that he was devoured by camera people; later I’ll look for the bones.

Off to the side stood a white-haired gentleman holding a “McCain” placard. But this was no ordinary volunteer — it was Fred Malek, the big-cheese Republican (and would-be Washington Nationals owner). He said he’s co-chairman of McCain’s campaign. “Chairman” is often a somewhat honorary title in a presidential operation.

“I finally found my proper role in the campaign — sign carrier,” Malek said. His wife, Marlene, was on sign duty, as well. “I’d do anything for John McCain,” she said.

Mr. Malek predicted a McCain win today and huge momentum.

“He doesn’t have to win Michigan” — Mitt Romney has a native-state advantage there — “but I think he will. You can’t underestimate the momentum that’s going to be generated by a victory here.”

Does McCain have enough money to compete in the large states?

“It’s picking up. Nothing like a little success to open the money faucets.”

Humility in an Age of Swagger

Monday, October 29th, 2007

Today’s Washington Post has as its lead in the Business Section, an article on 34 year old David Marriott, Bill Marriott’s youngest son.  The article discussed the major sales reorganization David is leading at Marriott and quotes me as an owner of Marriott hotels:

“A regional sales approach will definitely have greater appeal to the clients who we must ultimately serve and therefore should increase brand preference,” said Fred Malek, a former top executive at Marriott who owns several of the company’s hotels. “But it also has to be blended with consideration for the profit/loss interest of individual general managers in a diverse ownership group.”

This is a good article about a fine young man, who may indeed one day follow in his Father’s footsteps and head Marriott International.  However, the article only touches on what is one of the core characteristics of humility shared by both Bill and David Marriott.  This humility has earned them deep respect as well as affection.  There is no swagger, no pronouncements from on high.  In my eight years as President of Marriott Hotels, reporting to Bill Marriott, he did a lot of listening, careful to acknowledge and in many cases defer to the expertise of executives in various specialties.  He listened, learned, made the right decisions, and rallied people around these decisions.  It was a lesson in leadership, it was an exhibition of humility, and it demonstrated how humility and consensus building can strengthen leadership and produce results.

David has inherited these characteristics of his Father, and in my view they are a large part of the reason for his past success and promising future.

Joe Torre and Performance-Based Baseball

Friday, October 19th, 2007

Joe Torre should have taken the deal!

After 12 years as manager of the New York Yankees, and twelve post season appearances and four World Series titles to his credit, Joe Torre yesterday turned down a one-year contract to continue. The reason as reported in the Washington Post was because of a pay cut from $7.5 million to $5 million, which as the Post reports is still the highest in Major League Baseball.

Well, in my view it wasn’t a pay cut. Rather, Yankees’ ownership took a page out of the pay policies that the smartest companies are adopting – pay for performance. The contract included incentive bonuses of $1 million if the Yankees reached the playoffs, another $1 million if they made it to the American League Championship Series, and a further $1 million if they reach the World Series. Add it all up and it’s $8 million, an actual increase. What’s wrong with that? Let’s compare Torre’s pay with that of other manager who have won titles recently. The baseball fan site The Red Sox Times lists the pay of all MLB managers for the ‘07 season. Turns out that with an ’07 salary of $7.5 million, Torre is already getting paid more than three times as much as Boston Red Sox manager Terry Francona ($1.65 million), Chicago White Sox manager Ozzie Guillen ($1.1 million), and Los Angeles Angels manager Mike Scioscia ($2 million).

As the highest paid manager in baseball – and perhaps in the history of the game – and with the highest payroll in Major League history, why not agree to incentives vs. guarantees, as do most of the corporate world and many in sports? In my view Yankees ownership acted responsibly, and I wish this great manager had agreed to return. The world of sports and baseball has lost (hopefully for only a short time) a legend.

On a related note, contrast the Yankees with the Washington Nationals, who operated with one of the lowest payrolls in baseball and a rookie manager, Manny Acta. When I led the group partnered with the city to bring baseball to Washington, it was my dream to see a team developed from the ground up along the lines of the Cleveland Indians and Colorado Rockies. That’s what Manny Acta and Jim Bowden are doing under the able leadership of team President Stan Kasten – and at a fraction of the cost in management and players. I like what I see there and look forward to the day they enter post season competition.

Yes, Fred Malek Does Blog

Friday, October 19th, 2007

 

Earlier this week I wrote about the greening of the hotel industry, based on a Washington Post article on the makeover of The Bethesda Doubletree, the hotel owned by my company, Thayer Lodging Group.

That blog post earned a nice mention by Anne Schroeder of the Politico, who writes their Shenanigans column. Here’s what Anne wrote yesterday:

Fred Malek Blogs?

The man who has done everything under the sun in Washington — though possibly best known for his philanthropy, his leading role in returning baseball to D.C. and his advising top Republican officials and presidents — has gotten all Gen X-y on us, admitting Al Gore got to his staunch Republicanism.

And his views on air, too.

“Did Al Gore get to me? Sure — it proves even Democrats can get it right sometimes; and in my view, Mr. Gore earned his Nobel for drawing attention not only to global warming but to the environment overall,” Fred Malek writes about his new goal of hopefully becoming the leader of going green within the hotel industry.

“Ever get sleepy in the afternoons? Wonder why? Maybe it’s more than the big lunch. Maybe it has something to do with the air you breathe. We are convinced that we can differentiate our product and improve preference for our hotels through these measures. Green means more than improving the environment — it can also create more green on the bottom line,” he writes.

Agrees a D.C insider: “Fresh air is something this town sorely needs.”

 

It was a gracious and fun item in Anne’s column. But more important than my blogging, I hope it sparks greater discussion about how going green can help consumers and businesses alike.

The Greening of the Hotel Industry

Monday, October 15th, 2007

Today’s Washington Post carries an article on the makeover of The Bethesda Doubletree, the hotel owned by my company, Thayer Lodging Group. Here’s an excerpt from the article:

Mood lighting is the latest fancy touch added to the Doubletree by its owners, Thayer Lodging Group, the Annapolis hotel company co-founded by longtime Washington investor Frederic V. Malek. Over the summer, Thayer installed a purification system in the hotel’s meeting rooms to help keep air fresher and cleaner with an eye toward drawing more business customers.

The Post piece discusses our focus on providing a healthier and relaxing alternative to typical hotels. That it is, but there’s more. Our goal is to become the leader in the “greening” of the hotel industry. Surprising for this conservative Republican? Yes. Did Al Gore get to me? Sure – it proves even Democrats can get it right sometimes, and in my view Mr. Gore earned his Nobel for drawing attention not only to global warming, but to the environment overall.Perhaps the most important part of our efforts at Thayer Lodging is the impact not only the environment but also health. Not only are we providing healthy menu alternatives but we’re also purifying the air in meeting rooms and guest rooms. Typical hotels re-circulate the air throughout the day leading to a depletion of oxygen. Ever get sleepy in the afternoons? Wonder why? Maybe it’s more than the big lunch. Maybe it has something to do with the air you breathe. We are convinced that we can differentiate our product and improve preference for our hotels through these measures. Green means more than improving the environment – it can also create more green on the bottom line.

 

hi hi hi hi hi hi hi hi hi hi hi hi hi

Thoughts On Sallie Mae Buyout Collapse

Thursday, September 27th, 2007

One of the credit crunch’s victims is the huge Sallie Mae proposed buyout.

The Washington Post covers it extensively today – and includes my thoughts on what’s happening.

“One of the largest private takeovers in history — the $25.3 billion buyout for college loan giant Sallie Mae — unraveled yesterday after its buyers balked at the price, citing turmoil in the credit markets and federal legislation to cut subsidies to student lenders.

The buyers, headed by fund manager J.C. Flowers, left open the possibility of acquiring Sallie Mae at a lower price. Sallie Mae vowed, however, that it would fight to keep the deal intact ‘to the fullest extent permitted by law.’  …

‘Several deals have collapsed under their own weight. There will be more,’ said Frederic V. Malek, chairman of Thayer Capital, a private-equity firm in the District.”

Indeed. I’ll be curious to watch as the trend continues. My further sense however is that does not signal the end of the buyout boom.  We in private equity will just need to be more conservative in our pricing and leverage and earn returns the old fashioned way of growing revenues and profits.

Putting The Markets In Perspective

Thursday, August 30th, 2007

Let me venture here far beyond my expertise or confidence in an effort to share my views on the gyrating financial markets. I’ll start by saying I have developed my career by building companies and not by predicting markets or selecting stocks. However, it seems we have seen this story unfold before, and it always seems to follow similar patterns which we forget in the madness of the moment. The patterns are:

  • The market overreacts in both directions – driven by “irrational exuberance” or doom and gloom.
  • These moods of course exacerbate the swings and have the potential to cause panic.
  • The tide carries good companies down with the troubled ones, but of course it’s hard to recognize which are which when the tide moves so rapidly.
  • As the scenarios unfold, few have the courage of their convictions to buck the trend, and this in itself accentuates the swings.
  • The swings usually tend to last longer than anyone predicts.
  • The value is ultimately realized as sanity returns and the markets adjust, usually regaining much of the lost ground, or giving up some of the great gain.

In my view the credit markets, buyout values, and stock market were due for adjustment. In fact a few months ago I was quoted in the Washington Post stating that the buyout values were unusually frothy and couldn’t last forever. Some private equity firms were borrowing nine times operating earnings on acquisitions (at Thayer our buyouts average only 3.4 times leverage) which means any bump in the road could sink a company and not allow it to pay its interest, let alone retire debt. Also multiples on real estate had risen to unfound heights (6 percent capitalization rates down from 9 or 10 just a few years ago – cap rates being the inverse of multiples).

So yes, a correction was in order, but not this tidal wave. It is at times like this that he most productive investments can be made. And yes, it does take courage of your convictions to cut against the grain and take the risk. My belief is that the preponderance of evidence suggests that this is a time to take risks!

  1. The economy is fundamentally sound. We enjoy continued GDP growth, low inflation, and low interest rates. Further, corporate profits continue to increase, even if at a more moderate rate.
  1. Major deals are still moving forward with some at more reasonable, reduced prices.
  1. There continues to be great liquidity around the world.

But, we all know the above. What gives me more confidence today are the actions of great institutions and individuals, to wit:

  • Bank of America’s $2 billion investment in Countrywide has risk but in my view is one of the smartest investments in recent months.
  • One of my closest friends and a true leader in real estate investing is Joe Robert, head of JER Companies. Joe saw the value of his JER Investment Trust (JRT) sink from a high of $18 to $9 or less. This company has no residential exposure and makes mortgage loans on commercial real estate, yet its stock was pounded along with other commercial mortgage REITS. What did Joe do? According to the Washington Post, he personally purchased $8 million of JRT stocks in the last several weeks.

In sum, don’t take my beliefs or take confidence in popular known trends. But do watch what the smart money does. It says, we have seen an overcorrection where solid companies have been punished, and there is opportunity for selective investing and lending.

Business IT Support managed IT services IT Consulting Cloud IT solution Microsoft Office365 Cabling and Wiring Cat5 cabling Cat6 cabling Backup and Disaster Recovery On-Demand IT Support Small business IT Support Geeks to the Rescue computer repair Mac repair IT Support mac logic board repair laptop repair arlington computer repair falls church computer repair alexandria computer repair vienna computer repair Mclean computer repair fairfax computer repair Washington DC computer repair Computer geeks Law Firms IT Support  Medical Practices IT Support Financial IT Support Insurance Agency IT Support Non-Profit IT Support Real Estate IT Support  Computer service  Business consulting company  Services repair  Home computer repair Repair imac  Data recovery  Computer tech service  Computer geeks on call Computer hard drive recovery Cctv Security camera Surveillance camera Dropbox for Business Dropbox