Manhal Shammami outside
Manhal Shammami outside his upcoming hotel in Farmington Hills. DRY SPELL Continued from page 35 hotels on a daily basis, which helps with overhead and costs. It’s different if you only go once or twice a month – then you’re in the dark.” – Manhal Shammami, who, along with his brothers, owns a Best Western in Southfield and a Comfort Inn in Farmington Hills. The Shammamis are currently building a 92-room Holiday Inn Express in Novi, which will open in October, and in the fall break ground on a 108-room Candlewood Suites in Brighton. Each project is valued at million. DON’T SKIMP “Never compromise the principles because economic times are hard. Total dedication to quality, service and true value is what will keep you in the marketplace in the end. It’s so easy to cut corners and think you’re saving money, but sometimes you shoot yourself in the foot. You have to stick it out until these times pass. Those who do the minimum lose customers, and it backfires. “We try to do our homework and go into pockets where there is demand for the product. We don’t just jump in; we try to have the elements of success lined up as much as we can: great flag, great location, superb management, award-winning quality and aggressive marketing.” – Basil Bacall, co-owner of Truss Development, which is building an .5- million, 90-room Hampton Inn in Shelby Township that opens next month. The company also owns a 106-room Hampton Inn in Commerce and a 93-room Holiday Inn Express in Auburn Hills. SHOP AROUND “There is only one way to make more money. If you can’t raise your prices then save through the back door — either the way you buy or on labor. In this economy there are vendors willing to sacrifice their pricing to get your business, so keep getting different quotes from different vendors. When a new guy comes in, we listen to him – it’s always a good idea to keep your options open. I switched to a different food service company because I found one that is 25 percent cheaper than what I had. “Also, you need to shift your ‘Never compromise the principles because economic times are hard. You have to stick it out until these times pass.’ – BASIL BACALL,TRUSS DEVELOPMENT buying to accommodate what’s selling – we’re selling more chicken and burgers than steaks and chops these days. Smaller companies can thrive because they have the ability to change – big companies take a year just to change the price.” – Johnny Karmo, owner of three Market Square supermarkets. A brand-new one is being built in West Bloomfield that will offer 10,000 square feet to grocery shoppers, plus 3,000 square feet upstairs for a dry cleaner and coffee/ice cream shop. Opening in February, Karmo said the new store will offer “the best of everything.” INVEST IN TECHNOLOGY “If you own a store that cashes checks, buy the right software. The system I use is called Secure Check Cashing. It takes the customer’s pic- 36 CHALDEAN NEWS AUGUST 2008
tough times for borrowers BY MIKE SARAFA Last Month, the Feds seized the -billion IndyMac Bank after a -billion run on customer deposits. It is the second-largest bank failure in U.S. history and probably just the beginning of what will be a very difficult period for the U.S. banking industry. Locally and regionally, many banks are on the brink and are ripe to be bought or merged. We are on the eve of the greatest industry shakeout since the Savings and Loan debacle of the 1980s and 1990s, or maybe even since 1929. Banks and other financial institutions are becoming more focused on profits as opposed to growth. This new focus on balance sheet management is likely to usher in a new era of self-restraint by bankers across the country. The mortgage and financial industry will not resemble itself a year from now with massive attrition, layoffs, mergers, acquisitions and some bank failures. Capital and liquidity are the new buzz words and the measurements by which the government, rating groups and the market will judge the strength of financial institutions. All of this means less available credit, higher borrowing rates, lower LTVs and the lack of appetite for financing businesses in industries that are deemed distressed. These include investment real estate, gas stations and manufacturing among others. Credit scoring, “No Doc” ture, fingerprints, ID and Social Security number. It saves bad checks in its history so you know if you’ve cashed one, and it stops you from making the same mistake. If it stops you from cashing three or four bad checks, it equals what you paid for it.” – Steven Salaka, owner of the Check Cashing Store on West Grand Boulevard in Detroit. Salaka is opening a second location at Milwaukee and Woodward. TREAD LIGHTLY “Don’t spread yourself too thin. I deals and over-the-counter lending are gone and not likely to return for the foreseeable future. Institutions that are relationshipbased models as opposed to commodity lenders are likely to benefit from this new environment if they are able to maintain adequate capital and liquidity levels. Community banks that mitigate risks with tight underwriting, lending limits and portfolio diversification will likely emerge from this shakeout with strength and stability. Banks that can successfully rightsize customer expectations while still meeting their needs with innovation and creativity will have a competitive advantage. The wholesale relinquishing of certain markets and certain industries is likely to prove an over reaction and an unwise ceding of market share. Unfortunately, for some banks, their over-aggressive tactics in the good years have left them with no choice. Which leads to one final point: Honor and integrity must be restored to the banking profession, which has been pockmarked with greed, overzealousness, lack of responsibility and fraud. The market will flush itself out but so too must the industry and the profession. Once this occurs, a sense of normalcy and stability will return, which will help the economy further recover. Mike Sarafa is president of the Bank of Michigan. would be very cautious at this time until some positive signs show in the economy. In bad times, you need to make sure you have enough backup to carry you over the bump in the road. Have good control on what you own and run the business more efficiently until things start to clear.” – Ismat Karmo, owner of Delta Hotels and IMK LLC. The company manages several hotels and is currently building a nearly million, 90-room Hampton Inn and Suites scheduled to open in October in Canton. Chaldean-owned Triangle Development is the contractor. S U B S C R I B E ! SUBSCRIPTIONS DUES 12-Month subscription I wish to subscribe to the Chaldean News for 12 issues Please fill in your name and address below: Name ____________________________________________________________________________ Address ___________________________________________________________________________ City ___________________________________ State _____ Zip _____________________ Phone ______________________________ E-mail _____________________________ Please mail the form, with a check made payable to: The Chaldean News, Attn: Subscriptions 30095 Northwestern Hwy., Suite 102 Farmington Hills, MI 48334 PHONE: 248-355-4850 www.chaldeannews.com AUGUST 2008 CHALDEAN NEWS 37
