Starwood 2009 Annual Report Download - page 79

The Corporation was incorporated in 1980 under the laws of Maryland. Sheraton Hotels & Resorts and Westin
Hotels & Resorts, Starwood’s largest brands, have been serving guests for more than 60 years. Starwood Vacation
Ownership (and its predecessor, Vistana, Inc.) has been selling VOIs for more than 20 years.
Our principal executive offices are located at 1111 Westchester Avenue, White Plains, New York 10604, and
our telephone number is [phone].
For discussion of our revenues, profits, assets and geographical segments, see the notes to financial statements
of this Annual Report. For additional information concerning our business, see Item 2 Properties, of this Annual
Report.
Competition
The hotel industry is highly competitive. Competition is generally based on quality and consistency of room,
restaurant and meeting facilities and services, attractiveness of locations, availability of a global distribution
system, price, the ability to earn and redeem loyalty program points and other factors. Management believes that we
compete favorably in these areas. Our properties compete with other hotels and resorts in their geographic markets,
including facilities owned by local interests and facilities owned by national and international chains. Our principal
competitors include other hotel operating companies, national and international hotel brands, and ownership
companies (including hotel REITs).
We encounter strong competition as a hotel, residential, resort and vacation ownership operator and developer.
While some of our competitors are private management firms, several are large national and international chains
that own and operate their own hotels, as well as manage hotels for third-party owners and develop and sell VOIs,
under a variety of brands that compete directly with our brands. Changes in the general availability of suitable land
or the cost of acquiring or developing such land could adversely impact the profitability of our vacation ownership
and residential business.
Environmental Matters
We are subject to certain requirements and potential liabilities under various foreign and U.S. federal, state and
local environmental laws, ordinances and regulations (“Environmental Laws”). Under such laws, we could be held
liable for the costs of removing or cleaning up hazardous or toxic substances at, on, under, or in our currently or
formerly owned or operated properties. Such laws often impose liability without regard to whether the owner or
operator knew of, or was responsible for, the presence of such hazardous or toxic substances. The presence of
hazardous or toxic substances may adversely affect the owner’s ability to sell or rent such real property or to borrow
using such real property as collateral. Persons who arrange for the disposal or treatment of hazardous or toxic wastes
may be liable for the costs of removal or remediation of such wastes at the treatment, storage or disposal facility,
regardless of whether such facility is owned or operated by such person. We use certain substances and generate
certain wastes that may be deemed hazardous or toxic under applicable Environmental Laws, and we from time to
time have incurred, and in the future may incur, costs related to cleaning up contamination resulting from historic
uses of certain of our current or former properties or our treatment, storage or disposal of wastes at facilities owned
by others. Other Environmental Laws govern occupational exposure to asbestos-containing materials (“ACMs”)
and require abatement or removal of certain ACMs (limited quantities of which are present in various building
materials such as spray-on insulation, floor coverings, ceiling coverings, tiles, decorative treatments and piping
located at certain of our hotels) in the event of damage or demolition, or certain renovations or remodeling.
Environmental Laws also regulate polychlorinated biphenyls (“PCBs”), which may be present in electrical
equipment. A number of our hotels have underground storage tanks (“USTs”) and equipment containing chlo-
rofluorocarbons (“CFCs”); the operation and subsequent removal or upgrading of certain USTs and the use of
equipment containing CFCs also are regulated by Environmental Laws. In connection with our ownership,
operation and management of our properties, we could be held liable for costs of remedial or other action with
respect to PCBs, USTs or CFCs.
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