The DJIA rose 66 points while Nasdaq was down 35, the S&P 500 rose 4 points and the 10-year treasury yield was down .06 to 3.52%. Lodging stocks were mixed to modestly higher. The lack of volatility in the overall market the past week, even as we get into earnings season, is a bit disturbing.
According to the latest STR U.S. bubble chart update, for the four weeks ending April 15, 2023, recovery growth across a range of industry indicators took a small backstep, with occupancy (64.1%) falling 0.7 percentage points from the prior month. Recent occupancy indicators were also down year over year (-0.2ppts) as well as from 2019 (-5.1ppts). The Top 25 Markets were led in occupancy by Tampa (80.4%) which had a 5.5 percentage point decline from the prior four weeks. Next was New York City (80.3%, +4.2ppts YoY), Las Vegas (79.4%, -2.6 ppts), Orlando (78.2%, -0.9% ppts) and Oahu (77.5%, +2.1 ppts). None of the Top 25 Markets matched their 2019 occupancy levels for the recent four weeks. However, many large markets have narrowed their occupancy margins above this time last year. Oahu ran the narrowest occupancy deficit from 2019 (-1.8%) while six of the Top 25 Markets showed four-week/2019 occupancy shortfalls of 10 ppts or greater, including Chicago, Philadelphia and Minneapolis. Gains in ADR among Top 25 Markets present a more favorable pattern with all but two large markets seeing YoY increases. Four of the better-performing markets (Oahu, Tampa, New York City and Orlando) saw 8% or higher increases in ADR. A handful of lower-performing occupancy markets saw hyperactive YoY ADR gains, including St. Louis (+10.5%) and Chicago (+9.4%). Overall, the general pace of annual ADR gains among Top 25 Markets has moderated from prior months. In terms of RevPAR, 18 of the Top 25 Markets experienced YoY gains in RevPAR for the match period. New York City had the largest YoY RevPAR dollar gain, increasing $40 (+23.1%) to $213. While Tampa led large markets in occupancy, its YoY RevPAR declined to $118 from $154. Outside of the Top 25 Markets, the Florida Key’s four-week 84.8% average occupancy continues to lead other markets for this time of year. The Key’s market was followed in occupancy by Charleston (80.2%, -3.3 ppts YoY); Sarasota (79.1%, +0.2ppts), Savannah (78.7%, -2.0 ppts) and Fort Lauderdale (77.9%, -2.9%).
Each of the four world regions showed a year-over-year decline in hotel construction activity, with Asia Pacific coming closest to its 2022 comparable, according to March 2023 pipeline data from STR. March 2023 (% changes in comparison with March 2022): Europe: In Construction: 184,851 rooms (-18.2%); Final Planning: 133,580 rooms (-15.9%); Planning: 156,095 rooms (-5.4%); Total Under Contract: 474,526 (-13.7%). Germany (34,030) and the U.K. (29,160) lead Europe in total rooms in construction. Asia Pacific: In Construction: 475,993 rooms (-0.8%); Final Planning: 105,435 rooms (-29%); Planning: 322,507 (+1.9%); and Total Under Contract: 904,935 rooms (-4.4%). Among countries in the region, China has the most rooms in construction (299,458) followed by Vietnam (36,358). Middle East & Africa: In Construction: 119,505 rooms (-5.8%); Final Planning: 45,529 rooms (+20.4); Planning: 84,116 rooms (+21.2%) and Total Under Contract: 249,150 (+6.4%). Most of the region’s pipeline activity is focused on the Middle East. Saudi Arabia (42,033) and the United Arab Emirates (22,324) lead in construction activity. Americas: In Construction: 197,844 rooms (-4.5%); Final Planning: 278,383 rooms (-19.6); Planning: 277,598 rooms (+32.3%); and Total Under Contract: 753,825 (-1.2%). The U.S. holds the majority of rooms in construction, followed by Mexico (10,803), Canada (5,899) and Brazil (5,549).
The Hospitality Asset Manager Association released the results of its Spring 2023 Industry Outlook Survey. Highlighted results include: the top three issues concerning hotel asset manager are wage increases (65%), labor availability (57%) and demand (52%). 66% of members believe the U.S. economy either already is in or will slip into a recession in 2023. 74% of membership actively are pursuing acquisitions. 59% of members neither have nor are contemplating a management or brand change.
The Northport Hotel in Northport, NY announced it would be accepting guest reservations for hotel stays that begin August 1, 2023. The first completely new luxury boutique hotel to open in historic downtown Northport Village on Long Island’s Gold Coast features 26 rooms and a casual fine dining restaurant.
The Wrobel family, owners of the historic Hotel Fortney in Viroqua, Wisconsin, announced they will reopen the hotel on Thursday with 14 new boutique guest rooms that replaced 41 much smaller rooms on the building’s second and third floors. The property offers a lounge and an outdoor gear room.
The Nirvana Hotel, located on The Strip, in Las Vegas, Nevada, is owned bySandy Hershkowitz and her husband, Eric. The 25-room property offers a Zen Garden and a food truck. Future renovations for the hotel include the addition of two suites, with a Jacuzzi or spa in one and a bar in the other. They are also working on an outdoor lounge.
The Bent Inn will open sometime this summer in downtown Las Vegas, Nevada as the only LGBTQ-owned and operated hotel in the city. Featuring 33 rooms, the former Moonlight Motel is being developed by Mark Hunter and Greg Kafka. In addition to an onsite gastropub and coffee bar, the Bent Inn will feature a poolside food truck.
Preferred Hotels & Resorts added 10 new properties to its portfolio this spring in destinations ranging from the Austrian Alps to the beaches of Sri Lanka. The properties are as follows: Interalpen-Hotel Tyrol, Legend Collection located in Telfs, Austria; Virgin Hotels New York City, L.V.X Collection; Hotel Villa Real 5*,Madrid, L.V.X Collection; Marino Beach, Colombo, Connect Collection; Hotel Balmes 4* in Barcelona, Spain, now part of Preferred’s Lifestyle Collection and Preferred Residences; BOHO CLUB MARBELLA, Lifestyle Collection in Marbella, Spain; Borgo Scopeto Wine & Country Relais, Lifestyle Collection inSiena, Italy; MYRIAD by SANA, L.V.X Collection, Lisbon, Portugal; and Hotel Beausite, L.V.X Collection in Interlaken, Switzerland.
Personnel Move
Gulph Creek Hotels appointed Sabriya Homer as Vice President of Accounting & Administration. In this role, Sabriya will be a key leader in the creation, execution, and refinement of profitable financial strategies designed to maximize opportunities for Gulph Creek Hotels properties. Most recently, Sabriya led and developed the accounting team at OTH Resorts.
Europe Highlights
The Peel Group has sold the allegedly haunted Midland Hotel in Bradford, UK, to the Britannia Hotels chain. Christie & Co, brokered the sale.
YOTEL announced plans to debut YOTELPAD, in Europe with the opening of YOTELPAD London Stratford in Q4 2023, following a long-term management agreement with the owner, Silver Mascot Limited. It will be YOTEL’s seventh property in the UK and third in London. The new build YOTELPAD London Stratford features 62-PADs, 24-hour Mission Control, Grab & Go, laundry facilities and ample storage space. The property will also be home to food & beverage and retails space due to open in 2024.
Investment firm Sixth Street has brought in Rocco Forte Hotels to operate a new luxury resort in Porto Cervo, Costa Smeralda. The new property is jointly developed with Eidos Hotel Capital Partners acting as an operating partner and asset manager. Sixth Street acquired the property in January 2022. Formerly knows as Hotel Le Palme, the resort is set to open in 2024 with 64 rooms and suites, a spa, three restaurants, as well as a rooftop bar and meeting and event space.
Leumi UK has agreed to a £13.75 million short-term loan with Frogmore to refinance Cotton Quay, an 8.5-acre waterfront site in Salford Quays, Manchester, UK. The site has hybrid planning consent for 1,493 built-to-sell residential units, 475 hotel beds, as well as ancillary commercial space. Knight Frank and Burgess Salmon acted for Leumi UK.