The DJIA was down 80, Nasdaq was up 4, the S&P 500 was flat and the 10-year treasury yield was up .03 to 3.60%, yet another truly mixed session. Lodging stocks were mostly lower but modestly so. VCSA traded down to yet another all-time low.
Upper upscale hotels, the property types most associated with business travel, are well represented in the U.S. development pipeline. The volume of projects in the segment points to confidence in the future of business travel, according to STR. Upper upscale saw the slowest recovery, but a steady climb in performance and the business travel indicators have supported developer confidence in the segment. The March 2023 U.S. Hotel Pipeline (percentage change in comparison with March 2022) is as follows: In Construction: 154,284 rooms (-0.5%); Final Planning: 239,995 rooms (+34.6%); and Planning: 232,517 rooms (-21.6%). After three consecutive month-over-month increases, the overall number of U.S. rooms in construction fell slightly in March, aligning with patterns in previous years. Among the chain scale segments, luxury shows the highest number of rooms as a percentage of existing supply. Luxury (5.2%, 7, 136 rooms); Upscale (4.1%, 36,089 rooms); Upper Midscale (3.7%, 43,470 rooms); Upper Upscale (3.4%, 23,564 rooms); Midscale (2.1%, 10,363 rooms); and Economy (1.0%, 6,302 rooms).
According to the American Customer Satisfaction Index Travel Study 2022-2023, satisfaction across all four industries measured, airlines, hotels, car rentals, and online travel agencies, is up. The outlook is especially cozy for hotels. Overall guest satisfaction with hotels climbs 6% to an ACSI score of 75, with Hyatt skyrocketing 10% to tie Marriott (up 3%) atop the industry standings at 80. Both Hilton (up 4% to 79) and IHG (up 3% to 76) experience valuable gains. Despite sitting at the bottom of the industry, the large group of small hotels sees the most significant bump, ascending 11% to a score of 72. Wyndham, up 4% sits in a tie with the smaller hotels. According to the study, guests feel they are getting more value for their stays, and extras like hotel amenities (76) and food services (74) receive much higher ratings than in the past. In short, the ACSI results are cause for optimism for the hotel industry at large.
STR reported US lodging data for the week ended 4/15. US hotel RevPAR was up 8.6% year over year. Compared to the same week in 2019, RevPAR was up 17.8%.
Woodbine Development Corp. is pursuing an expansion of Hyatt Hill Country Resort & Spa, in San Antonio, Texas, following the near completion of an extensive renovation project. Woodbine set out last spring to upgrade the property including a complete redo of the Hyatt’s 500 hotel rooms, meeting spaces, pre-function areas, corridors and lobby.
Highgate Capital Investments and Flynn Properties have purchased the historic 135-room Huntington Hotel in San Francisco for $29.3m. The hotel’s prior owner, Woodridge Capital Partners, had defaulted on a $56.2m loan from Deutsche Bank. On the same day that Highgate and Flynn officially bought the hotel, they also obtained a loan of $26.6 million from Deutsche Bank to finance the purchase. The new owners of the hotel will likely undertake a series of renovations and upgrades to bring the 12-story property up to modern standards.
AKA announced the opening of Hotel AKA Alexandria. Located in the heart of Old Town Alexandria, Virginia, the 180-room property features two distinctive dining options, an expansive fitness center and an on-site theater. Hotel AKA is equipped with a conference center as well as a 1,500 square foot Junior Ballroom with an additional 700 square foot pre-function area.
Extell Development is planning a hotel at the site of the Wellington Hotel, a century-old building in New York, New York. The developer will renovate the 27-story hotel, which will include ground-floor retail and business amenities such as banquet rooms, commercial kitchen and a lecture hall. Floors 8 to 27 will be used exclusively as a hotel.
Gaylord National Resort announced the opening of the all-new, completely re-imagined Old Hickory Steakhouse on May 10, 2023. The steakhouse is the third dining experience scheduled to debut to guests. The property’s ongoing investment is part of a $14 million restaurant transformation following a $64 million guestroom renovation. Highlights of the Old Hickory Steakhouse space include: Old Hickory Bar; The Den; Main Dining Room; and The Terrace Room.
Disney is opening its second Disney Vacation Club property at the Disneyland Resort in Anaheim, California. The Villas at Disneyland Hotel will officially open on September 28, 2023, with over 340 movie-themed rooms, a pool and on-site bar.
Best Western Hotels & Resorts announced the opening of the Best Western Iowa/Lake Charles East in Iowa, Louisiana. The hotel completed a $3 million full renovation of its 61 guestrooms and suites and public spaces. The property features on outdoor pool and a fitness center.
Starlight Haven, announced the groundbreaking of an expansion project to its Hot Springs, Arkansas, location. Starlight Haven plans to start accepting reservations for the new accommodations in Q4 2023. Once complete, Starlight Haven Hot Springs will have a variety of unique lodging options including treehouses, geodesic domes, and safari-style tents. Additionally, guests will have access to a range of on-site amenities and recreational activities.
Quadrum Global completed the $96 million purchase of The Williamsburg Hotel in Brooklyn’s Williamsburg District, making it its fourth hotel in New York City. The eight-story brick tower boasts 147 guestrooms, a 6,500 square-foot grand ballroom, a restaurant, lobby bar and lounge, a water-tower rooftop bar and a rooftop lounge and pool area.
Franklin BSP Realty Trust, Inc. said they completed the sale of the Williamsburg Hotel, the Company’s Brooklyn asset, by a trustee appointed by the U.S. Bankruptcy Court for the Southern District of New York. The sale price of $96 million (see prior story), comprised cash and new indebtedness. The Company has recovered the full principal amount of its loan and approximately $20 million of additional proceeds.
CBRE facilitated the sale of JW Marriott Tucson Starr Pass Resort & Spa, a 575-key resort located in the Sonoran Desert. The property features three onsite nine-hold golf courses, outdoor multi-level pools with lazy river and waterslide, private cabanas, hot tub, spa, and fitness center. Meeting and event space, including outdoor space, has 83,732 square feet.
CBRE also announced it has facilitated the sale of The Perry Hotel and Marina in Key West, Florida.
Braemar Hotels & Resorts Inc. finalized an extension of its $51.0 million mortgage loan for the 80-room Hotel Yountville. The loan is being extended beyond its original maturity in May 2023 for an additional 6 months with one additional 6-month extension available. As extended, the loan will have a rate of SOFR + 2.55% that will reset to SOFR + 3.50% on July 1, 2023. The Company is also working with its lender on an extension or refinancing of its mortgage loan secured by the Bardessono, which has a final maturity in August 2023.
LuxUrban Hotels Inc. entered into an agreement with the holder of its senior secured convertible notes totaling approximately $5 million. The terms of this agreement are designed to all the Company, subject to the satisfaction of certain conditions, to eliminate all debt associated with the Convertible Notes and gain access to new equity capital through a mandatory conversion feature.
Interval International announced the renewal of a long-term relationship with Divi Caribbean Club, Ltd., operator of one of the largest shared ownership resort portfolios in the Caribbean. The multi-year agreement encompasses seven resorts in Aruba, Barbados, Bonaire, and St. Maarten. As part of this agreement, Divi Vacation Club members will receive the valuable benefits of Interval Platinum membership, entitling them to a number of flexible exchange opportunities and upgraded services.
European Highlights
Aimbridge Hospitality announced that Aimbridge EMEA has been selected by Borealis Hotel Group to manage the Aparthotel Adagio Antwerp City Center, Belgium, due to open in early summer 2023. The eight-story property will feature studio apartments, a communal bar area, fitness room, library, marketplace, and laundry room.
The Marty Hotel Bordeaux, Tapestry Collection has opened in the Meriadeck business district of Bordeaux, France, marking the band’s third European property to debut in 2023. The hotel boasts 61 guestrooms, a large bar and a buffet available from dawn to dusk. Recently acquired by Vicartem in partnership with Extendam, Marty will be operated by the Younight Hospitality hotel management company.
Minor Hotels announced the expansion of Avani Hotels & Resorts in Europe and Latin America. As part of a strategic expansion into new regions, Avani will add five properties in key cities in Europe – one in Spain, two in Italy, one in Germany, and next year, one in the Netherlands. Coinciding with the European expansion, Avani will also launch in Central and South America with hotels to be added in Mexico and Colombia. The first of the additions will see Avani make its debut in Spain in June, with the rebranded 101-key Avani Alonso Martinez Madrid Hotel. In Italy, the brand will launch with the rebranding of two hotels, first the 65-key Avani Palazzo Moscova Milan Hotel in June, followed by the 144-key Avani Rio Novo Venice Hotel in the summer. Later in the year, Avani will debut in Germany with the rebranded Avani Frankfurt City Hotel, offering 256 rooms. In 2024, Avani will enter the Netherlands with the launch of a 163-room hotel in Amsterdam: The rebranded Avani Museum Quarter Amsterdam Hotel. Each of these will be rebranded from Minor Hotels’ NH Collection Hotels line. The company is also preparing to introduce the brand in Latin America, where two additions to the Avani portfolio are planned for later this year with two more rebranded properties. Regional operations will begin with the launch of the 140-key Avani Cancun Airport hotel in Mexico in Q3 followed in Q4 by the 66-key Avani Royal Zona T Bogota Hotel in Colombia. These will also be rebranded from the NH Collection hotels line.