PhillyInc

Host Hotels & Resorts Inc., which owns Philadelphia's Four Seasons, Marriott Downtown and Airport Marriott hotels, said its first quarter results were hurt by "weak citywide demand" here.

The Bethesda, Md., company reported results last week. The transcript of its conference call with Wall Street analysts was filed today with the Securities and Exchange Commission. -- Jonathan Berr

Planalytics, the Wayne firm that makes long-term weather forecasts, based on analysis of weather patterns over many years, to help businesses plan, says April was the coldest in a decade. It broke a decade-long string of warm Aprils culminating in the warmest ever April last year. "The negative impact of the displacement of April economic activity will likely cause uncertainty and doubt ...," the company said. This will have a greater impact, Planalytics said, than the upswing in gas prices and worries about the current global geopolitical situation. -- Henry J. Holcomb

One of the big-bucks hedge funds that helped US Airways Group Inc. come out of bankruptcy almost two years ago has cashed in on its investment, saying it thinks the current up cycle in the airline business may have run its course. PAR Investment Partners L.P. put up $100 million in September 2005, a transaction that was crucial at the time because it helped bring other private equity firms into the deal. PAR later acquired more shares in private transactions, eventually controlling about 14 percent of the airline. The Boston firm sold 6.5 million US Airways shares in February, and this week sold an additional 6.75 million, at $35.90 a share. This week’s transaction alone grossed more than $242 million, providing a nice return on that initial investment. The buyers in both cases were other big investment bankers, the Goldman Sachs Group Inc. and UBS Securities L.L.C., which yesterday downgraded airline stocks. -- Tom Belden

Starwood Hotels & Resorts Worldwide Inc. , parent of Sheraton, Westin and St. Regis hotels, said Philadelphia was one of three locations that showed revenue-per-available-room growth that was "particularly strong," in the first quarter, according to a filing with the Securities & Exchange Commission. The others were Toronto; Kauai, Hawaii; and San Francisco. -- Jonathan Berr

Orbitz Worldwide Inc. plans to fight the efforts from tax officials from the state of Pennsylvania and city of Philadelphia and other local and state governments to collect levies related to the sale of hotel rooms. These officials "have begun or attempt to pursue formal or informal administrative procedures or audits or stated that they may assert claims against the company relating to allegedly unpaid state or local hotel occupancy or related taxes," the Chicago-based company said in a filing today with the Securities & Exchange Commission about its plans to go public. Officials from New Orleans, Madison, Wisconsin, along with the states of Wisconsin and Indiana are also after Orbitz, which plans to "vigorously" defend itself against these claims. -- Jonathan Berr

PhillyInc gets a kick from enjoys a good news release, especially those aimed at a Philadelphia audience but sent by folks who know us only as a marketing zone. Consider this, from the folks at Smokey Bones Barbeque & Grill, a 75-restaurant chain that was put up for sale by its owners in Orlando: PHILADELPHIA (May 10, 2007) - Smokey Bones restaurant in Philadelphia will remain open. Well, that's a relief. The news release went on to offer the address of the Philadelphia operation: 2723 N. Meridian Blvd. -- in Reading.

Two years after a de-icing boom hit fell on a US Airways jetliner in Philadelphia, the legal fight is hitting full stride. Nobody was hurt on the London-bound Airbus A330 sitting on the Tarmac in Philly. But at least four lawsuits have been filed. And 11 other de-icing booms in Philly had been found to have structural defects. It's all detailed in an SEC filing by boom owner Air T Inc. (Nasdaq: AIRT) of North Carolina, which reads like a litigators' soap opera. Air T is being sued by the city of Philadelphia, by the airline, and even by its then-employee, boom operator Robert Emerson, who has claimed injuries. US Airways is seeking $2.6 million in costs to fix the plane and lost revenue. In turn Air T is suing the boom-maker, Glazer Enterprises Inc. of Omaha. The city's lawsuit also names Glazer, which also goes by Elliot Equipment Co. The 135-foot boom collapsed in February 2005, causing structural damage to the aircraft. Since then, Air T -- operating in Philly under the subsidiary Global Ground Support L.L.C. -- had
evidently has been trying to make amends. It said it spent $905,000 as of last year to return all booms to service after an independent structural engineering firm found design flaws and structural defects. An Air-T executive declined to comment beyond the SEC filing. The cases are scheduled to start coming to trial in September. - Jonathan Berr

We wonder: Last summer's campaign, including Broadway-esqe commercials with elaborate dancing and production, cost $2 million. Did the GPTMC get its money's worth with this summer's commercial under a lower $1.5 million budget? Or was last year's commercial better and worth the higher price? (Vote up at the left. Poll closes at midnight June 25).

The new commercial can be seen here at the The Greater Philadelphia Tourism Marketing Corp.'s site:

Here's last summer's commercial:

- Tom Belden and Thomas Ginsberg

Last week, we asked PhillyInc readers whether this year's Philly tourism-promotion commercial, with its cool theme and hip-looking actors, is better than last year's comic musical-theme commercial. This year's campaign reportedly cost a little less and we wondered whether the city got its money's worth. Well, by a significant margin, the favorite was this year's spot:

A list of all Philly locations shown is the film is here, courtesy of GPTMC.

We also would emphasize that the No. 2 choice was "neither so good." (See last year's spot here on YouTube.) Not sure what that means. There were relatively few total votes (just 95). Here's the full results:

In any case, we used the opportunity to ask the Greater Philadelphia Tourism Marketing Corp., a nonprofit city-chartered agency, about the way it makes commercials and how it chooses themes. The Q&A is below.

Seriously, pull out your calculator. The Federal Aviation Administration says its plan will save 12 million annual minutes of delays at Philadelphia, New York and New Jersey airports. Philadelphia currently logs 1.94 million minutes of delay for its 583,000 flights each year. That averages to 3.32 minutes delay per flight. The FAA said it can lower that number to 2.83 minutes -- a reduction equal to 29.4 seconds per flight, on average -- by fanning out planes over three more flight paths.

Is saving a half-minute per flight worth the costs of implementing this plan? Well, to answer that question, you would first have to know what the costs of implementing such a plan are. Rep. Joe Sestak says the FAA doesn’t know. Neither do the legislators opposing it. Nor does the crowd of Delaware County residents who booed FAA officials in May. In fact, he said no one knows much about the long-term affects it could have on air emissions, property values or educational development. So Sestak said he asked the Government Accountability Office to look into it. Sestak’s indecipherable presentation, which he made available to a reporter, alleges that the FAA doesn’t understand the difference between sound and noise. (It has something to do with centroids, contours and “% highly-annoyed” metric models).

The GAO report is supposed to be done after the FAA makes a decision on its redesign plan in August but before it implements it eight months later, Sestak said.

- Joseph Galante

PhillyInc illustration

"We make a policy of not talking about the talent we put into our advertising."

OK. Let the Lottery have that secret.

Smith and spokeswoman Chris Stambaugh went on to say Gus actually has groupies. "He gets letters. He gets emails," Smith said, adding that people write Gus with tongues firmly in cheek. "It's amazing how popular he is."

Stambaugh said about one or two people per week seek out the spokesrodent. Some have asked for and gotten autographed pictures (signed by Stambaugh?). "Gus groupies, I guess we can call them. I actually respond on his behalf."

Actually, like Lassie and Kermit, there is more than one Gus. Smith said the agency upgraded the animatronic creature (like the ones in Disney World) to give him more realistic mouth and hand movements. "It's got motors inside to help make it move," Smith said. But the original Gus did return to the television airwaves dressed in drag to play Mother Gus. Smith wouldn't rule out the possibility of the appearance of more Gus relatives.

- Jonathan Berr

However, the GPTMC, also dutifully no doubt, failed to note that both hotels have steadily fallen in the magazine's recent Top 100 hotels lists. Last year the Four Seasons was No. 74 and Rittenhouse No. 93. (The list goes from 1 to 100, so a smaller number is a higher rank). In 2005 the Four Seasons was No. 48 and the Rittenhouse No. 65. In 2003 the Four Seasons was No. 15 and Rittenhouse No. 64. You get the point. (Here's 2004 and 2002, which show the same basic trend.)

Sure, just making the cut in this online popularity poll is a feat. But does this also say something else? Perhaps it's not only about the hotels, but about the city itself? Then again, these online surveys can be notoriously fickle. Hard to believe the Four Seasons actually dropped 70 notches in four years. We may have to ask for an expense-paid meal there to investigate ...

- Thomas Ginsberg

They're not calling it a derby, but demolition is scheduled to begin at 2:15 this afternoon, starting with the former Buck's Hardware on 13th Street, of buildings standing in the way of an expanded Convention Center.

- Tom Belden

How far is Lower Bucks County from Outer Space?

Not that far, perhaps. Environmental Tectonics Corp. (AMEX:ETC) in Southampton has signed a contract with Virgin Galactic, a company owned by Virgin Group's Richard Branson to provide training for Virgin Galactic's suborbital space travelers -- the first set of space tourists. At first, Environmental Tectonics will train Virgin Galactic's Founders, the name given to the first 100 travelers to sign on with Virgin Galactic. But the contract extends beyond those travelers, the company said. Training runs September through November at Environmental Tectonics' NASTAR Center in Southampton.

Environmental Tectonics creates software that provides flight simulation so pilots can learn to respond in an emergency. But so far, they haven't managed to create the software that will teach chairman William F. Mitchell and the rest of management how to respond to three years of losses and declining revenues. Nonetheless, at least for today, shares are up and trading is brisk -- maybe that's because of today's announcement, or because of Tuesday's news that the company's largest investor, former cable-television executive H.F. "Gerry" Lenfest sunk another $3.3 million in the company, by buying 3,300 shares of preferred stock.

- Jane M. Von Bergen

Everybody has an angle. See Tom Belden (our colleague) at Road Warrior on the Kyle Ebbert-Southwest Airlines dustup. Can't make this up.

Scott McCartney at the WSJ writes today about the financially successful, but operationally abysmal, merger of US Airways and America West. Among other things, he says this:

Tying two networks together has been a financial success, saving thousands of jobs at two distressed airlines and creating a nationwide low-cost carrier. But almost every airline that has bought another has suffered service declines while workers, equipment, facilities, computer systems and aircraft try to mesh. Reservation systems proved a particularly difficult problem for US Airways, leading to many customer problems.

And their service was stellar before the merger? Check a few installments at Road Warrior.

Robert Isom, the recently appointed operations chief at US Airways Group Inc., said in a Wall Street Journal article yesterday that one of the biggest reasons for the airline's troubled operations since its merger with America West was that officials from each company lacked "a common focus as to what's important to fix." But Isom says he is trying. He has centralized control over decisions by US Airways' individual airport managers whether to delay a flight. He told the WSJ he hoped to have operations "back on track" in 2008. We'll be watching.

How much is a new flight route from Philadelphia to London Heathrow Airport worth to Doug Parker, CEO of US Airways Group Inc.? According to the Financial Times this week, his airline paid a "record price" for a set of takeoff and landing slots at Heathrow in preparation for its new service there.

Giving no sources or dates, the FT said the Italian carrier Alitalia sold a set to US Airways for 30 million pounds, one of several sets it has sold to other airlines. That equaled $59.4 million at this week's exchange rates, but we don't know a date to figure an actual equivalent. US Airways spokesman Phillip Gee told us a confidentiality agreement prevents the airline from saying anything about the deal. "Sorry, not much help I know," Phil says.

Then again, somebody did talk to the FT. The paper says Heathrow takeoff and landing slots have more than doubled in price in the last two years, and Alitalia is cashing in now on a bigger surge caused by U.S. airlines seeking to exploit the "open skies" treaty that comes into force at the end of March. It calls US Airways' 30 million-pound payment a "record" at Heathrow.

- Thomas Ginsberg

The official tally is in and the numbers confirm that 2007 was a very good year to be running a hotel in Center City and across the region. If you were on the other end of the equation, paying for hotel rooms, of course, you may not be quite as pleased.

According to data compiled by Smith Travel Research and vetted by PKF Consulting in Philadelphia, Center City hotels had an occupancy rate of 73.6 percent, a fraction above 2006 and the best year since 1997. But the demand was strong enough that hoteliers were able to push up their average daily rate to record territory: $156.56, a 7.3 percent increase compared with 2006.

Throughout the metro area, occupancy wasn't as strong, finishing at 68.8 percent in 2007, compared with 69.4 percent the year before. Demand was healthy enough, though, for the average daily rate to climb 6.7 percent, to $119.14 from $111.71.

- Tom Belden