The DJIA surged 765 points while Nasdaq was up 234, the S&P 500 rose 90 points and the 10 year treasury yield was down .15 to 3.66%. Lodging stocks were modestly higher. The two big movers were AINC with a gain of 19% and MCG with a drop of -7% to a new low.
All the main equity indexes rose 3% today with the DJIA up 825 points, Nasdaq up 361, the S&P 500 rose 113 points and the 10 year treasury yield was down .03 to 3.62%. Lodging stocks were higher. SOHO rose 12%, SOND jumped 10%, SVC was up 7% and PK, TNL, HGV, ABNG and VAC were each up 6% on the day.
The CBRE Hotels Research State of the Union showcases a review of current hotel trends, leading and coincident indicators of hotel demand, and an update on cost pressures and margin flow-through. Key Takeaways from the latest report include CBRE calling for a mild recession in 2023. GDP is expected to be flat in 2023 with negative growth in H1 2023 and positive growth in H2 2023. Unemployment remains low but is expected to increase. CBRE expects higher and more persistent inflation. Inflation is expected to remain above the long-run average of 3.3% until 2024. August RevPaR weakens. TSA throughput data remains above 90% of 2019 post Labor Day. TSA data and Google search trends data continue to be positive. Consumer and business outlooks are softening. Credit levels are on the rise while business and consumer confidence wane. Post Labor Day return-to-office disappoints, bringing a headwind to business travel. International travel continues to rebound. The inflationary environment is leading to margin pressures.
Nearly all hotels are experiencing staffing shortages, according to a new member survey conducted by the American Hotel & Lodging Association. 87% of survey respondents indicated they are experiencing a staffing shortage, 36% severely so. The most critical staffing need is housekeeping, with 43% ranking it as their biggest challenge. These numbers are slightly better than in May. Hotels are offering potential hires a host of incentives to fill vacancies such as: increased wages, greater flexibility with house and expanded benefits, yet 91% say they are still unable to fill open positions. According to the U.S. Bureau of Labor Statistics, as of August, hotel employment was down by nearly 400,000 jobs compared to February 2020. Hotels are looking to fill many of the jobs lost during the pandemic, including more than 115,000 hotel jobs currently open across the nation. These staffing challenges are resulting in historic career opportunities for hotel employees. National average hotel wages for 2022 through June are more than $22 per hour, higher than any other year on record.
General Hotels Corporation, in partnership with Weathervane Capital Partners, has begun work at the site of its future Homewood Suites hotel in the Borrows West development in Viera, FL. The 131-room property, to be operated by General Hotels Corporation, will be an addition to the 115-acre mixed-use development that will feature offices, medical and professional office buildings, waterfront dining venues, retail, entertainment venues, and multi-family opportunities. The Homewood Suites Viera will offer a business center, fitness center, pool and a patio with fire pit and comfortable seating. Construction, led by Hospitality Project Services, LLC is expected to be completed in early 2024. This is the first of two hotels planned for Borrows West by this partnership group. Construction will also soon begin for a 208-room Hilton Garden Inn featuring a roof-top bar and generous meeting space. The Hilton Garden Inn is expected to be open in summer 2024.
Stonebridge Cos. acquired the DoubleTree by Hilton Hotel Las Vegas Airport, marking Stonebridge’s expansion into the Las Vegas market. Stonebridge Cos. will serve as the property operator of the full-service hotel. Renovations planned for the 190-key hotel include a refresh of guest rooms and common areas. Work is anticipated to begin in the second quarter of 2023, with completion slated in the fourth quarter of 2023.
HP Hotels has been chosen by Lodging Fund REIT III, Inc. to manage their newly acquired Hilton Garden Inn Charlotte North and Hilton Garden Inn Charlotte Pineville properties both located in North Carolina. HP Hotels has already been managing these properties for years for another ownership group. Each of these Lodging Fund-owned 112-room, five-story Hilton Garden Inns feature an outdoor pool, fitness center, business center, snack shop, and meeting space. Each property will undergo a comprehensive property improvement plan to include interior and exterior renovations.
The DoubleTree by Hilton in downtown Rochester, MN has closed to be renovated into a University of Minnesota dorm. Two tenants will remain open for business during construction and the front entrance will remain open for business access and special events. The University of Minnesota will lease nine floors of the DoubleTree Hotel to renovated about 200 rooms to provide 400 freshman student housing beds as well as gathering, dining and recreational space. The dorms are expected to open in fall 2023. The hotel, which is managed by Avra Hospitality, would be required to make an estimated $7.63 million in renovations to convert it from its current use as a hotel into a student housing facility.
Chartwell Hospitality announced the completion of their hotel development in Nashville, TN. The newest addition to the Nashville hotel portfolio is a 172-room dual-branded Hilton Garden Inn and Home2 Suites hotel in the Parke West mixed-use development in Nashville’s West End neighborhood. The dual-branded hotel will feature 172-keys, 103 rooms at the Hilton Garden Inn and 69 rooms at the Home2 Suites. Amenities include a 10th-floor rooftop pool, lobby bar and restaurant, and approximately 4,000 square feet of flexible meeting space. All properties in the Parke West development will utilize an underground, 452-space parking garage that Chartwell Hospitality co-developed with GBT Realty.
Hilton and Peloton Interactive, Inc. announced an industry-first partnership, making Hilton the first hospitality brand to feature Peloton Bikes across its entire U.S. hotel portfolio of 18 brands. By year’s end, nearly all 5,400 U.S. Hilton-branded hotels will feature at least one Peloton Bike in every fitness center, including access to Peloton’s instructors and expansive connected fitness content.
Best Western Hotels & Resorts announced the opening of the Best Western Watertown Inn & Suites in Watertown, SC. Owned by Watertown Lodging Group, the 66-room hotel features a waterpark with waterslide and water play structures, a fitness center, laundry facilities, business center and a meeting room.
Medalist Diversified REIT announced the Medalist Diversified Holdings, LP, the company’s operating partnership, completed the sale of the company’s Clemson Best Western University Inn, located in Clemson, SC, to an unaffiliated purchaser for $10,015,000.
A new, $27.5 million Cambria Hotels is preparing to open on Thursday in the East End neighborhood of Portland, ME. The hotel offers 102 guest rooms and an onsite restaurant.
Petros PACE Finance has closed on a record $153 million C-PACE financing as part of the $820 million, 580-acre Black Desert Resort Project in Ivins, UT. Phase 1 of Black Desert Resort will include a luxury resort hotel, approximately 1,000 condos, 190,000 square feet of retail, restaurants, and commercial space, 25,000 square feet of meeting space, a clubhouse and a 19-hole golf course. The development is currently under construction and Phase 1 is set to open in the fall of 2024. Petros is partnering with the project’s developer, Reef Capital Partners. Black Desert Resort will be the most environmentally friendly resort eve built, with Reef spending more than $200 million on project components that are more environmentally friendly than the law requires. Upon buildout, the property will offer 150 hotel rooms; 1,050 residences; a wellness spa; 46,160 square feet of retail and restaurant space; 32 single-family estate lots and approximately 214,000 square feet of commercial space, with the amenities of the resort center available for full-time residents.
White Lodging announced two new senior-level appointments. AJ Brow will take on the company’s Chief Human Resources Officer position and Joe Pagone joins the company as Regional Vice President. Brow will be tasked with modernizing the White Lodging’s strategic human resource capabilities and executing initiatives to support its Associate Promise to create an environment where associates can be their best selves through ongoing training, development and mentoring. Brow joins White Lodging from NiSource where he was Vice President. Pagone will oversee a portfolio of urban and lifestyle hotels across the country, including the company’s first Kimpton brand hotel in San Antonio. Pagone joins from Kimpton Hotels & Restaurants where he served as Vice President of Hotel and Restaurant Operations.
Rosewood Hotel Group announced Soo Jeong Lee has been promoted to Vice President of Design. Lee joined rosewood Hotel Group in 2017. In her new role based out of the brand’s Amsterdam office, Lee will lead the Design team in the EMEA region, providing guidance on the implementation of Rosewood’s design standards and overseeing the design vision for all projects and renovations accordingly. Rosewood Hotel group also announced Priya Kapoor joins the group as Vice President of Digital. Kapoor previously held leadership roles at Ogilvy & Mather, Mattel, and L’Oreal. In the newly created position, Kapoor will oversee digital, eCommerce, and customer experience across all group brands. She will work across the commercial, brand, and IT segments to elevate Rosewood’s existing digital experience.
Travel Outlook announced Judy Cassidy is joining the company as Senior Sales Executive. Judy’s responsibilities will encompass direct sales and sales team leadership, growing Travel Outlook’s revenue through expanding its presences in new geographies, and contributing to the company’s marketing and business strategies.