Here are some excerpts from Daily Lodging Report of the past week. If you’re not a subscriber, you should be. Get updates on hotel deals, development, inventory and career changes. Register here, now.
Sunday, December 4
RCM acquired the Staybridge Suites Chattanooga Downtown, a five-story, 124-room extended-stay hotel in Chattanooga, Tennessee. The business has the option of converting 13,000 square feet of underutilized ground floor space into additional guest accommodations, retail or meeting space. The extended-stay hotel boom has helped the segment compete with the boom in vacation rentals and short-term accommodations.
Braemar Hotels & Resorts Inc.. finalized the acquisition of the luxurious 210-room hotel Four Seasons Scottsdale Hotel at North Troon in North Scottsdale, Arizona. The $267.7 million acquisition was financed with cash and no common shares were issued. The property includes 5.7 acres of excess developable land which is zoned for commercial purposes. Potential uses include new hotel keys, as well as fitness and health studios, restaurants, and accessory buildings.
Hyatt Hotels Corporation and Playa Hotels Resorts SA announced the opening of Hyatt Zilara Riviera Maya in Riviera Maya, Mexico. The all-inclusive resort features 291 suites, an ocean-view pool with an adjacent hot tub, nine restaurants, downstairs and lounges, a Zen spa and more than 6,000 square feet of modern conference and meeting facilities .
Skift Rating: Some analysts are wondering if Hyatt plans to acquire Playa Hotels to expand further into all-inclusive resorts.
Monday, December 5
Morgan Stanley revived coverage of the accommodation industry, saying they prefer C-Corps to REITs [real estate investment trusts]. MS said it believes C-Corps has undergone structural changes over the past 10 years that have generated more resilient and higher free cash flow. Although they believe US hotel REITs have cut costs, the cyclical environment and elevated capital spending remain. MS said they believe the macro risk everyone is talking about is more subdued than a typical cycle, especially as the travel recovery is still underway. Regarding stock selection, MS launched with overweight ratings on Hyatt (The best choice), Hilton, Marriottand Wyndham. Underweight ratings were assigned to Xenia Hotels, Pebblebrook Hoteland Sunstone Hotels.
According to the New York Daily News, more than 10,000 Airbnb listings for short-term rentals in New York City are likely to disappear when tough new housing rules come into force next year. The rules, which are due to be implemented on January 9, will be require all Airbnb hosts in the city to register their units with the Mayor’s Office of Special Execution. Airbnb will not be able to process payments from hosts who do not register. The company said the rules would result in a “draconian and unenforceable registration system that will prevent legal and responsible hosts from listing their homes.” The news came after The Washington Post has profiled growing consumer complaints against Airbnb.
Skift Rating: Swings of fortune. Hotel REITs have had many hot years as equity investments. Perhaps the brand’s parent companies will have their day in the sun once the markets rebound. As for Airbnb, where a city closes a door, it finds a window.
Tuesday, December 6
According to South China Morning Posteven without the Chinese, hotels on the Indonesian holiday island of bali are booked solid for Christmas and New Year period. According to the article, Airbnb named Bali as the world’s most popular vacation destination between July and October. The place was kutaa beachfront neighborhood just 10 minutes from Bali airport. Kuala Lumpur in Malaysia was second. As for the hotels, not only are they filling up with reservations, but they are getting good prices with the Four Seasons at Jimbaran Bay says charge $3,300 per night for a villa during the holiday season and most would be booked. Based on this article, the vast majority of hotels are reporting expected occupancy more than 90% for the period. What will happen to places like Singapore and Bali when Chinese people can travel again?
Sharbell Nexton, LLC announced the addition of a AC Hotel by Marriott in the Downtown Nexton area of Summerville, South Carolina, in 2024. The four-story hotel will feature 117 rooms, an outdoor pool and courtyard, an indoor kitchen and open lounge, a fitness room and meeting space. Nexton will be the second AC-flagged property in South Carolina. The project involves Baywood Hotels.
Continental Hotel Group acquired the 108 rooms Spring Hill Suites in the South Side neighborhood of Pittsburgh. Renovations to the property will begin in the first quarter of 2023, focusing on technology upgrades, room product and fitness experience. Continental’s current portfolio comprises 15 hotels, including 13 open/operating assets and two under construction.
Skift Rating: It is interesting to see how some destinations have found ways to thrive without international outbound Chinese travellers. But these travelers will one day return, causing new surges in demand.
Wednesday, December 7
Morgan Stanley cut their note on Airbnb at Underweight of Equal Weight, reducing its target price to $80 from $100. Their bearish scenario has the stock plunging to $60. MS believes ABNB’s property supply will slow to 7% per year through 2025, down from the 12% pace from 2018 to 2022. MS is not very confident in the growth figure of 7 %. They also reduced their estimates for nights booked for 2023 and 2024. With slowing growth in listings and occupancy not exactly increasing, MS isn’t very confident, hence the downgrade and the reduction of the target price.
ONYX Hotel Group unveiled plans to bolster its serviced apartment brand, Shama. They plan to open nine new properties in Thailand and one in Malaysia by the end of 2025, strengthening their portfolio. The group currently operates six Shama properties in Thailand and 10 in hong kong and China. Onyx took over the Hong Kong-based Shama brand in 2010. Onyx launched Shama Social Cluba new lifestyle concept that seeks to connect Shama guests to the fabric of the local community where the property is located with programs of activities, events, games, social occasions, food and drink and locally adapted music.
Skift Rating: Airbnb continues to face regulatory headwinds, such as the New York decision mentioned in a previous article above. His growth has been remarkable but gravity could eventually affect him. Onyx’s move into serviced apartments highlights the broader competitive resilience to alternative accommodations from hotel companies.
Thursday, December 8
The last STR report, commissioned by Arabian Travel Marketconducted at the end of September 2022, suggests the GCC region now has more than 170,000 hotel rooms under development (planning, final planning and under construction). This is equivalent to 40% of current GCC hotel room inventory. The STR report estimates 135,560 existing rooms in Saudi Arabia with an active pipeline of 82,639 rooms, with a projected total room inventory for 2030 of over 218,000 rooms. For the United Arab Emirates, Ras Al Khaimah is only second to dubai with 5,076 rooms in its pipeline, almost the same amount as Sharjah, Abu Dhabiand Fujairah combined. In the past, the growth of hotel rooms in the UAE has driven demand, with room supply increasing by more than 70,000 rooms between 2010 and 2019.
hilton announced that its luxury brands would continue a year of growth in their global portfolios with 10 openings and a roll-out of new signatures across their Waldorf Astoria Hotels & Resorts, Conrad Hotels & Resorts and LXR Hotels and Resorts. The Conrad brand’s largest growth region is Asia Pacific. Other new markets entering the Hilton Luxury Brands portfolio this year include Shanghai.
Accor plans to add several more properties in Australia and New Zealand in 2023, including new furnished apartments. Accor has announced that it will add more than 520 hotel rooms to its portfolio in Australia with the opening in January of Morris Hotel and Manly Pacific MGallery in sydney and Mercure Cairns Hotel in queenslandwith the Pullman Sydney Penrith opening scheduled for the fourth quarter. In New Zealand, Accor will add more than 60 apartment-type units in the second quarter with Sebel Wellington’s Lower Hut and add 313 rooms to its Auckland portfolio with the opening of Pullman Auckland Airport in the fourth quarter. Opening in 2023 will also be three new lifestyle hotels of the Ennismore joint venture in which Accor is the majority shareholder, including a Jo&Joe and Hotel of the tribe in Auckland and a hyde property in Queenstown. The properties will add over 180 lifestyle units for the New Zealand business.
Skift Rating: Travel executives gather in Dubai next week for the Skift Global Forum East, a two-day event featuring conversations with CEOs from Hilton, Jumeirah, Kerzner, Global Hotel Alliance, Freehand Hotelsand more. Details here.
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