Mark Hoplamazian was a freshly minted MBA graduate when consummate dealmaker Jay Pritzker hired him to work on new investments and acquisitions in 1989. Almost immediately, the 25-year-old grandson of Armenian Christian immigrants found himself in an awkward position within the tightly knit Jewish family business.
"He came in and nobody could spell or pronounce 'Hoplamazian,' so I named him 'Steinberg,' " said Tom Pritzker, who has succeeded his late father as head of The Pritzker Organization, the financial and investment adviser to family businesses.
His intent was to engage in a bit of humor. Hoplamazian responded by drafting a letter explaining the history of the Armenian people, who have endured centuries of persecution, and the origins of his name, which dates to his great-great-grandfather and means "someone who is quite serious."
He ended the missive on a playful note, he recalls, writing something like: "If you haven't been convinced by this, and 'Steinberg' is the ultimate decision, then I'm going to need an invitation to (your Passover) Seder."
His diplomacy wowed the Pritzkers.
"He articulated it in a really warm, kind and at the same time effective manner," Tom Pritzker said. "I will never forget it."
Hoplamazian's savoir-faire, combined with keen business acumen, has served him well working within Pritzker-owned businesses ever since. He has guided lucrative deals and later helped unwind investments during the tumultuous period when the family fortune was broken up. Since 2006, he has served as president and chief executive of Hyatt Hotels Corp. That company, the family's crown jewel, went public in 2009 but is still majority-owned by family interests.
Hoplamazian, 48, the son of a self-made landscape designer and contractor, is widely viewed as calling the shots at Hyatt on a day-to-day basis.
Under his leadership, the company is breaking out of a conservative mold that left it vastly outpaced by expanding rival chains. It is moving rapidly from its stylized, luxury roots into a more diverse array of hotel offerings, including limited-service and extended-stay, and from its domestic foothold into a broader spectrum of key foreign locations.
Here and abroad, the company is opening properties in gateway cities served by major airline hubs, putting emphasis on such locales as the robust and New York City market, as well as Mexico City, and key cities in China and India.
But clearly, Hoplamazian must stay in sync with Tom Pritzker, who is executive chairman of the Chicago-based hospitality company and scion of the billionaire Pritzker family. By all accounts, the relationship is a close one and the conversation free-flowing, with Hoplamazian using Pritzker as a sounding board. Pritzker describes Hoplamazian as "my partner and my friend."
"We'll talk, I'll give him feedback," Pritzker said. "I'll say, 'Mark, you might want to think about doing such and such.' Sometimes he'll say, 'That's a lousy idea,' and sometimes he'll say, 'Oh, that's a good idea.'"
The relationship "is sometimes quite spirited, but there's a lot of respect," said Bill Mayer, managing partner of Park Avenue Equity Partners, who has advised the Pritzkers through the years. "There's a comfort level ... there's not a sense of 'got ya.' It's not that. They are trying to reach a common objective."
Too close for comfort?
Hyatt's annual meeting last month was a low-key, sparsely attended affair -- pretty much a two-man show in the Grand Hyatt New York's Empire Ballroom, with its oval chandeliers of hand-blown art glass. Pritzker offered a quick overview of the business, and Hoplamazian, sitting to his right, recognized some longtime employees for their contributions.
"We would not be able to do what we do here without your commitment," Hoplamazian told the veteran employees, who received a standing ovation. The company employs 90,000 people in 45 countries.
Some observers argue that the alignment between Hoplamazian and the Pritzkers is too close, leaving public investors outside the loop. Appearances at investor conferences are infrequent, they say, and the company does not provide guidance on future earnings, leaving investors more vulnerable to unexpected news when results are reported. A first-quarter earnings surprise, for instance, sent share prices downward this spring.
Hyatt shares, which traded at $28 when the company first went public, closed at $36.80 Friday. The stock's high point was February 2011, around $49, and it was in the $43 range prior to its first-quarter earnings report in early May.
Hoplamazian "has done a good job of deploying the company's balance sheet to secure brand presence in strategic markets ... but the company has done a poor job of being transparent for public investors," said David Loeb, a senior analyst at Robert W. Baird & Co., which expects to do business with Hyatt in the next three months.
The Pritzker family's investment interests are identical to those of public shareholders, Hoplamazian countered.
"They make money the same way as public shareholders," he said.
The company has opted against providing quarterly guidance, he said, because the hotel business by its nature is long-range, unlike consumer-products enterprises.
But the company will try to provide "a better perspective on what the next several years could look like," he said. "We have not done an investor day, for example, but we will get one scheduled. I feel that would be productive."
A second touchy issue for Hyatt and Hoplamazian is a bitter dispute with the Unite Here hotel workers' union in several key markets, including Chicago, which is home to several Hyatt properties, including the Hyatt Regency McCormick Place.
Workers have been without a contract for about three years as management and the union remain at loggerheads over union recruitment procedures and use of subcontracting for hotel staffing. Hyatt properties have been targets of boycotts and have lost some meeting business.
Hotel investor Laurence Geller, who serves on Chicago's convention bureau executive committee, has high regard for Hoplamazian and his leadership at Hyatt but thinks the union battle has gone on too long.
"This has become a distraction for Hyatt that will take its attention off growth while focusing on an increasingly vituperative and antagonistic fight," said Geller, who is chief executive of Strategic Hotels & Resorts and formerly worked for the Pritzkers. "Wearing my Chicago hat, I wish they'd settle quickly."
Hoplamazian took the helm of Hyatt, initially as an interim leader, after the resignation of 23-year veteran Douglas Geoga in mid-2006. Though Hoplamazian had worked on Pritzker family investments for many years, most recently as president of The Pritzker Organization, he had no previous experience in the hotel business.
"I wish I had a camera," Pritzker said, recalling when he asked Hoplamazian to take the job. "He looked at me like I was stupid, like it was the worst idea I ever had."
But Hoplamazian said he is drawn to the human elements in business and art. He takes pride, for instance, in biotech investments made earlier in his career and is drawn to Asian textiles because they are objects used in daily lives. He said he quickly fell in love with the hotel business because he liked the people involved in Hyatt and the company's potential to touch guests' lives.
When he shared his growing interest with Pritzker, he said the family business leader was amused, thinking, "Somehow I see what's happening here ... the needle has gotten into the vein."
Hyatt, under Hoplamazian's leadership, is not shooting for the massive scale of a Marriott or Hilton, whose portfolios are much larger -- about 3,700 properties each.
Rather, it is expanding in markets where its customers are headed, and broadening the types of lodging it can offer them, investing $1 billion the past two years. Last year, it purchased 20 hotels from LodgeWorks LP, converting some into Hyatt House extended-stay properties and some into Andaz hotels, its emerging boutique brand. It moved into the Mexico City market by purchasing a Hotel Nikko Mexico and converting it to a Hyatt Regency. And it is making a significant investment in Manhattan.
In total, the company has more than 170 hotels in development, with about half in China or India, which is a substantial undertaking considering it owns, manages or franchises only 488 properties across seven brands.
"The pipeline, as part of its total footprint ... is above the average of its peers," said analyst Joe Greff, managing director at JPMorgan Securities LLC, which counts Hyatt among its clients.
By holding its annual meeting at the Grand Hyatt New York, the company was showcasing some of its changes. It recently completed a $130 million renovation at the New York hotel, capping it off with the installation of twin marble sculptures by artist Jaume Plensa, who created the spouting Crown Fountain installation in Chicago's Millennium Park. At the Grand Hyatt, the white, oblong female heads, closed eyes suggesting a meditative state, anchor a soaring, dramatically lighted lobby.
The Grand Hyatt "was getting kind of tired," said Elmhurst-based hotel expert Ted Mandigo. Hyatt "cleaned up its act with existing properties and moved in with new properties," he said.
Since 2010, it opened Andaz Wall Street, Andaz 5th Avenue and Hyatt 48 Lex, properties that make use of textured wood, metal and stone to achieve sleek, urban looks. Four more hotels are being developed in New York, including a Park Hyatt that is part of a 90-story mixed-use tower rising up at the south end of a lushly green Central Park, within walking distance of such luxury retailers as Bergdorf Goodman, Louis Vuitton, Armani and Bulgari.
The Manhattan focus makes sense, Greff said. "If you are looking to build out brands globally, there are certain anchor markets you want to be in, and certainly New York City is one. And the fact that room rates are relatively high is a good thing for them."
With big investment comes greater risk, but observers think Hyatt is in a strong position because it has a strong balance sheet with more than $1 billion in cash and short-term investments, and because it plans to sell property investments over time, keeping just the management contracts.
Shaped by family loss
Hoplamazian, like many CEOs, has an intense drive, in his case stemming from his upbringing in suburban Philadelphia, the youngest of five children. His father died of a fourth heart attack, at age 53, when Hoplamazian was 12.
"As a 12-year-old, you don't really have great context for financial security," he said. "No matter that your mom is saying everything's fine and you shouldn't worry about it, I always had that on my mind.
His mother pushed him to get a top-flight education, he said, motivated by her regret at having to drop out of Radcliffe College to help with the family's grocery business after her father had a heart attack.
He received a bachelor's degree in economics at Harvard University and an MBA from the University of Chicago. Behind his desk, at Hyatt's headquarters on Wacker Drive, is a mounted kimono with an image of a roiling ocean. It reminds him of Japanese artist Katsushika Hokusai's wood block print, "The Great Wave off Kanagawa," which he studied during a freshman course at Harvard.
In 1991, he married Rachel Kohler, who heads the interiors group for her family's eponymous kitchen, bath and hospitality company based in Wisconsin.
When he's in town, he wakes about 5 a.m. to hit the treadmill in their Lincoln Park home, then has breakfast with their three children, ages 15, 12 and 8, and drives them to school. On weekends, he finds himself sitting in the bleachers, watching his children's sporting events.
His civic life has been busy as well, including volunteer work for the Latin School, the University of Chicago's Booth School of Business and New Schools for Chicago. He also helped introduce the Facing History and Ourselves curriculum, aimed at fighting bigotry, into Chicago's public middle schools.
At Latin, he led efforts to craft a strategic plan.
"What Mark championed ... was educating the whole child, and not just having school be about rigorous test scores and grades," recalls real estate investor Stephen Quazzo, a fellow Harvard alum who served with Hoplamazian on the Latin School board.
"He has this great ability to make complex issues clear," said attorney Jeff Sharp, who also served with him on the board. "He was able to develop consensus on a whole bunch of issues."
Noting Hoplamazian's intense dedication to his work and his family, Quazzo quipped: "My view is he does not play enough golf or go out with friends enough because he works so hard."
Actually, the two have had some laughs together, said Quazzo, co-founder of Pearlmark Real Estate Partners and a quick wit.
"We both married way above our station: Princeton women," he said. "We are constantly dragged to Princeton events and are forced to put on a happy smile. ... The joke is, we are part of a mutual support club."
And they are both die-hard Green Bay Packer fans.
"We went to the Super Bowl two years ago in Dallas and had a great time," he said. "Neither of us is from Wisconsin, but he's more legitimate -- he married into a Wisconsin family. I grew up in New Jersey, the ancestral home of (legendary coach) Vince Lombardi."
Hoplamazian worked as a mergers and acquisitions analyst on Wall Street and later in management consulting before deciding to join The Pritzker Organization at age 25. In many ways, that early decision was based on little more than gut feeling, much like his decision to go ahead and take the helm at Hyatt.
"I sort of voted with my feelings about it more than knowing with specificity what the future would hold," he said. "At the end of the day, I really liked everyone I met."
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Mark Hoplamazian: President and CEO of Hyatt Hotels Corp., a publicly traded hospitality company that remains majority owned by Chicago's billionaire Pritzker family.
Family ties: Married to Rachel Kohler, head of the interiors group for her family's eponymous kitchen, bath and hospitality company. They have three children, ages 15, 12 and 8.
Banter with the boss: Hoplamazian has an amiable relationship with Tom Pritzker, executive chairman of Hyatt. But there's a bit of playful tension in the sports arena.
Pritzker: "We used to play tennis ... but clearly, he wimped out in tennis. I was on a winning streak. Highlight that in your article."
Hoplamazian: "I have two embarrassing situations with Tom. One is not being able to keep up in tennis. He's pretty regular, and I'm not. I've been out of the tennis game for a while." Secondly, while on a business trip together, staying at the Park Hyatt Shanghai, "Something possessed me to challenge Tom to a race in the pool. He beat me, and I never lived it down."
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