The DJIA fell 764 points, Nasdaq was down 360, the S&P 500 fell 100 points and the 10 year treasury yield was down .05 to 3.45%. Lodging stocks were lower. AHT and MCG were down -6%, while VCSA was down -5%, SLNA traded down to a new low.
JP Morgan gave their Gaming & Lodging 2023 outlook. JPM said they see more compelling value and better risk-rewards in gaming versus lodging, given better values and differing sets of investors’ expectations for fundamentals. Larger cap lodging C-Corps like MAR and HLT possess above average valuations versus history, according to JPM, reflecting a higher set of investor expectations where RevPAR will grow in the low to mid-single digit range with the leisure segment continuing its resiliency with more acute corporate/group demand segment recoveries. JPM does see lodging having really attractive growth through 1Q23 but then comps get difficult in 2Q through the rest of the year. Their Overweight names are Wyndham and Hyatt.
Barclays gave their US Gaming, Lodging & Leisure outlook, saying their preference is the Cruise Lines out of the sub-sectors. They are looking for the mass market to outperform next year as in travel, they expect more price sensitivity next year with it more pronounced on the high end based on a sequentially worse macro backdrop for high end consumers than for lower and middle-income consumers. Barclays upgraded Wyndham to Overweight while downgraded Marriott to Equal Weight. They retained their Overweight rating on Hyatt.
The Baird/STR Hotel Stock Index rose 2.7% in November from October. Year to date the stock index is down -5.5%. The Hotel Brand sub-index was up 3.7% in November from October while the Hotel REIT sub-index was down -0.2%.
Highgate has entered into a definitive agreement to purchase Viceroy Hotels & Resorts. The Viceroy brand launch with Viceroy Santa Monica has evolved into a portfolio of hotels and resorts in iconic destinations such as St Lucia, Chicago, Los Cabos and Snowmass. The transaction is expected to close in early 2023. Highgate believes they can quickly add hotels to the Viceroy hotel categories, Icon Collection, Lifestyle Series and Urban Retreats.
Accor revealed a short list of properties to open next year in North America. Opening in early 2023 is the 10-story 21c Museum Hotel St. Louis. Mid-year 2023 brings the opening of the 35-story Raffles Boston Back Bay Hotel & Residences with 147 guestrooms and 146 residences. Bolstering its presence in Mexico City with a fourth property, the Novotel Mexico City Centro Historico is slated to open in late 2023.
Hilton announced the signing of the Waldorf Astoria Hotels & Resort brand’s third property in Mexico, the new-build Waldorf Astoria San Miguel del Allende, expected to open in 2025. The property will offer 120 hotel guestrooms and 24 Waldorf Astoria branded residences. Amenities for both hotel guests and residence owners include a fitness center, spa, rooftop space with pools and relaxation areas, art gallery, artisan crafts store, three restaurants, two bars and a coffee shop.
IHG Hotels & Resorts announced the grand opening of Holiday Inn Express Washington, DC Downtown. Operating under the management of Urgo Hotels & Resorts, Holiday Inn Express Washington, DC Downtown features 247 guestrooms and a fitness facility.
WoodSpring Suites and developer Gold Coast Premier Properties announced the groundbreaking of the WoodSpring Suites Corona, in Corona, California. Expected to open in late 2023, the 122-room property offers an expanded lobby with a coffee station, guest parking, a fitness center and guest laundry room.
Inspire Development started construction of Pearson Ranch, a $2 billion, 156-acre mixed-use project in northwest Austin, Texas. The master plan for the project includes 48 acres of land for a corporate campus, including 2.6 million square feet of office space. Upon completion, the mixed-use property will also include retail, restaurant, community and cultural spaces; two hotels; thousands of residential units; and 30 acres of park space. Construction on Pearson Ranch will begin with The Eden, an apartment community that will feature 306 units. Pearson Ranch is scheduled for completion between 2032 and 2037.
SureStay Hotel Group announced the completion of the guest rooms renovation at The Pacific Coast Roadhouse SureStay Collection by Best Western. The property features 48 renovated guestrooms and a fitness center.
Mumford Company completed the sale of two limited-service properties, The Mulberry Hotel in Westlake, Louisiana and the Inn at Pettyjohn in Fairmont, West Virginia. Mumford Company represented the seller, Mulberry Crossing in the sale of the 37-room hotel in Westlake, Louisiana. The purchaser was an affiliate of Duke Ascend Hospitality. Mumford also represented Freedom Bank in the sale of the 48-room Inn at Pettyjohn to Santosh, LLC. Following renovations the property will re-open and operate as an independent hotel.
Marcus & Millichap announced the sale of Avid Dania Beach in Dania Beach, Florida. The 101-room, four-story hotel sold for $16.75 million. Marcus & Millichap’s Fort Lauderdale office marketed the property on behalf of the developer. The property was purchased by a Mid-Atlantic investment group.
JLL Capital Markets closed a $245 million portfolio financing for a Napa Valley hotel property; three Class A coastal Orange County retail centers; one Class A multi-housing community; and a single tenant showroom and restaurant space. JLL marketed the portfolio on behalf of the borrower, Boardwalk Investment Group, and secured permanent financing from four lenders. The properties include: The Estate in downtown Yountville, CA with 193 guestrooms across Hotel Villagio, Vintage House, and the Villa at The Estate. Aliso Creek Shopping Center located within Laguna Beach. Flower Hill promenade in Del Mar and The Landing in Newport Beach. 1810 State Street, a 99-unit mid-rise apartment complex in Downtown San Diego’s premier neighborhood of Little Italy; and Restoration Hardware Yountville in downtown Yountville.
Original Group announced the opening of Temptation Miches Resort and Temptation Grand Miches Resort, its first adult-only hotels in the Dominican Republic. The resorts required an investment of $190 million and are located in Miches, in the province of El Seibo. The 114-suite Temptation Grand Miches Resort is an exclusive hotel for couples, with clothing-optional areas and unique amenities. The 382-suite Temptation Miches Resort is aimed at couples and party-loving, free-spirited groups of friends. Both hotels are all-inclusive with restaurants, bars, pools, and gyms.
Sandals Resorts International unveiled expansions to its flagship family resort, Beaches Negril in Jamaica and the Sandals Halcyon Beach in Castries, St. Lucia. The new additions at both resorts are available for travel beginning April 6, 2023. Beaches Negril will add a total of 12 new and expansive butler suites, bringing its room count to 197 luxury accommodations. The new additions consist of six all-new Firesky Reserve Villas and six suites in the Eventide Penthouse collection. Further complementing Beaches Negril’s existing 10 gourmet restaurants, Pirates Island Waterpark and additional amenities, and an entirely new building will house the resorts Camp Sesame. Sandals Halcyon Beach added 25 butler accommodations including 20 Joli Beachfront Suites and five new Koko Rondoval Villas. The expansion brings the total number of rooms and suites to 194 accommodations complementing the resort’s six gourmet restaurants, a bevy of watersports, access to golf, as well as an additional 21 eateries at the two nearby Sandals Resorts in St. Lucia. Expansions at Beaches Negril and Sandals Halcyon mark the beginning of news projected for 2023 and beyond including the opening of Sandals Dunn’s River, debuting in May 2023, as well as additional projects and new openings across Jamaica, Turks & Caicos, Curacao, St. Vincent & The Grenadines.
Personnel Moves
JLL Hotels & Hospitality Group announced Ketan Patel has joined the firm as a Managing Director in the firm’s Washington D.C.’s office. Patel will focus on growing JLL’s select service investment sales business, as well as enhancing the firm’s hospitality presence in the Mid-Atlantic region. In addition, Phil White will be joining JLL’s New York office as Vice President working under Patel.
SH Hotels & Resorts hired Marco Selva as Executive Vice President of Operations In this role, Selva will lead all operations for the company’s current portfolio consisting of three brands an a current total of 12 properties. He will also oversee operations for the robust pipeline of soon-to-open hotel, with 10 new openings expected over the next 3-5 years. Selva will be responsible for financial performance across the SH Hotels portfolio. Most recently, Selva served as Senior Vice President of Luxury Lifestyle Hotels for Highgate.
BWH Hotel Group announced its Board of Directors has elected Danny Lafayette as Board Chairman for 2023. Lafayette, who previously served as Vice-Chairman of the Board of Directors, brings decades of hospitality experience and over 40 years of Best Western ownership to his role as Chairman.