12/3/2015 | By Sarah Borchersen-Keto
Justin Knight, president and CEO of Apple Hospitality REIT (NYSE: APLE), joined REIT.com for a CEO Spotlight video interview at REITWorld 2015: NAREIT’s Annual Convention for All Things REIT at the Wynn Las Vegas.
Apple targets the select-service, extended-stay segment of the lodging sector, with assets in urban, high‐end suburban and developing markets across 32 states. Knight explained that Apple concentrates on this part of the lodging sector because of its broad consumer appeal and simple operating model, which has yielded a strong operating performance over multiple business cycles.
Apple listed on the New York Stock Exchange in May. Knight noted that while a number of Apple’s shareholders have changed since that time, very little has changed from an operations standpoint.
“We continue to focus on a strategy that’s been successful for us: broad geographic diversification and very little debt to maintain a risk profile that appeals to shareholders and that we think is a good fit for today’s economic environment,” he said.
Knight also reflected on his relationship with his father, Glade Knight, who founded the company. Knight said that while he and his father “attack issues slightly differently,” they share a commitment to maximizing shareholder value in a low-risk environment.
As for the emergence of new forms of lodging such as Airbnb, Knight said the development is certainly something the company is watching, particularly the impact in high-density markets. Because of Apple’s broad geographic diversification, however, effects on the company to date have been limited, Knight said. He added that Apple’s near-term focus is to ensure that Airbnb and similar operators are held to the same standards as traditional hoteliers.