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North America

Lodging Stocks End Higher While Hotel Index Stock Drops

Alan Woinski and Kim Woinski
October 17th, 2022 at 4:19 PM EDT

Skift Take

  • The DJIA jumped 551 points today while Nasdaq was up 354, the S&P 500 was up 95 points and the 10-year treasury yield was up .01 at 4.02%.
  • The Baird/STR Hotel Stock Index fell -9.1% in September. Despite continued strong RevPAR, both year over year and 2019 comps, the stock index has dropped -20.6% in the first 9 months of the year.
  • Driftwood Capital broke ground on the Element by Westin, a new 130-key extended-stay hotel located on prime oceanfront property in Melbourne, FL.

The DJIA jumped 551 points today while Nasdaq was up 354, the S&P 500 was up 95 points and the 10-year treasury yield was up .01 at 4.02%. Lodging stocks were higher. VCSA was up 10%, SOND was up 8%, ABNB was up 7% and SVC was up another 5%, still sporting a dividend yield of more than 10% even after a 33% jump in a week. Also rising 5% today were HT, PK, INN and MCG.

The Baird/STR Hotel Stock Index fell -9.1% in September. Despite continued strong RevPAR, both year over year and 2019 comps, the stock index has dropped -20.6% in the first 9 months of the year. The Hotel Brand sub-index was down -7.7% from August while the Hotel REIT sub-index was down -13.5%.

Driftwood Capital broke ground on the Element by Westin, a new 130-key extended-stay hotel located on prime oceanfront property in Melbourne, FL. Located adjacent to The Crowne Plaza Melbourne, another property owned and operated by Driftwood Capital, Element Melbourne Beach is the first Marriott-branded hotel in Melbourne Beach. When complete in 2024, the six-story hotel will offer an all-natural saline pool, 24/7 Motion Fitness Center, vehicle charging stations, on-site laundry and approximately 175 parking spaces.

The downtown district of Huntsville, AL is continuing to grow as a new hotel and mixed-use development has been finalized. The project is anchored by the AC Hotel by Marriott and Eclipse apartment complex. The new hotel will be a Moxy, a 100-room boutique hotel located adjacent to the AC Hotel and Eclipse. In addition to apartments, the mixed-use development will include office and retail space. The long-planned food hall would be approximately 15,000 square feet of the ground floor of the Moxy hotel.

Tharaldson Hospitality Management announced the opening of the brand-new Hampton Inn & Suites Santa Rosa Wine Country in Santa Rosa, CA. Located in the heart of Sonoma Wine Country, the 4-story, 100-room hotel offers parking and business center and more. Tharaldson Hospitality will own and operate the property.

Plans are underway to build a new hotel, office space and residential development to Ontario, Ohio’s shopping district. Moment Development, who recently bought six parcels of land, presented preliminary plans for a four-story hotel and other projects to the Ontario Planning Commission. Moment Development plans to build the hotel first and later add restaurants, office space and residential homes or apartments. The company is planning a summer 2023 groundbreaking for the hotel, with most of the project’s construction planned for fall and winter 2023. The hotel will be a 120-unit Home2 Suites by Hilton and will include 154 parking spaces shared between the hotel and restaurant.

Kimpton Hotel Fontenot, located in New Orleans’ Central Business District, announced the anticipated January 2023 completion of a property expansion into the historic building next door. The new addition to the boutique hotel will include 22 new guestrooms and suites, over 12,000 square feet of meeting and events space, and a three-meal French brasserie with outdoor patio dining.

IHG Hotels & Resorts announced the opening of the Holiday Inn Louisville Downtown hotel in Louisville, KY. The 91-room hotel, owned by HBS Hospitality and managed by Commonwealth Hotels, offers a business center, meeting space, fitness center and a rooftop bar.

Chartres Lodging Group purchased The Muse hotel, in New York City, for $49.5 million from asset manager Barings. Chartres’ deal to purchase the 200-room property closed the same day The Muse announced it would leave the IHG brand. According to Hospitality Net, it is unclear what Chartres has in store for The Muse, which offers a fitness center and upscale eatery. Chartres has yet to file any permits to modify the 17-story property with the New York City Department of Buildings.

South Street Seaport hotel run by the Cipriani family may soon have a new owner in Sono Hospitality. According to The Real Deal, talks between Sono and members of the Ghassemieh family, who own the 66-key Mr. C Seaport, are in early stages of talks. A notice filed with the New York State Department of Labor indicates that the hotel is scheduled to close in January, citing a sale to Sono as the reason for the closure.

ASH NYC will soon be developing a new boutique hotel in the Fan District of Richmond, VA. Plans for the conversion of The Shenandoah building, once a senior living facility, is for a six-story, 70 room hotel to have an onsite restaurant that will be operated in-house. A name and brand for the Richmond hotel haven’t been determined yet.

Aimbridge Hospitality announced the expansion of its portfolio with the addition of five extended-stay properties recently acquired by Three Wall Capital, LLC. The properties bring 603 keys under Aimbridge management and bolster the growth of its Select Service Division. The five properties are: the 126-room Candlewood Suites Birmingham-Inverness, Birmingham, AL; 96-room Mainstay Suites Jacksonville Camp Lejeune, Jacksonville, NC; 127-room Extended Stay America Premier Suites Pittsburgh-Cranberry, Cranberry Township, PA; 127-room Extended Stay America Premier Suites Cleveland-Independence, Independence, OH; and 127-room Candlewood Suites Cincinnati-Northeast Mason, Mason, OH

Point Pleasant Beach, in New Jersey, abandoned a controversial plan to demolish a local hotel to build a parking lot, but the legal battle over the site is continuing after the property owner accused the borough of civil rights violations. The owner of Amethyst Beach Motel first filed a lawsuit in May 2021, challenging the borough’s 3-2 council vote to pay the owner for the property and acquire the site through eminent domain. After months of defending the plan to condemn the motel and force the owner to sell, the council voted to repeal the decision. Despite the repeal, the owner John Fernicola is continuing his lawsuit and recently added additional claims. Now that the 40-room motor lodge is safe from condemnation, Fernicola is moving forward with the lawsuit so the borough is held legally accountable. No court date has been set to near the new claims in the lawsuit, but Fernicola said he plans to continue renovations on the Amethyst Beach Motel. 

Drift Santa Barbara plans to open in early December at the site of the longtime Church of Scientology building in Santa Barbara, CA. Commercial real estate broker Jason Jaeger, his partner Sep Wolf and a team of investors purchased the building from the church in 2020. The team has re-imagined the building and transformed it into a 45-room hotel under the management of TMC Hospitality

Stonehill’s commercial real estate group, Stonehill CRE, has deployed approximately $200 million of capital through the origination and purchase of its first mortgage loans since being launched in the second quarter of 2022. The company expects its commercial real estate group to deploy an additional $100 million in loan originations and other transactions by year’s end based upon deals in its pipeline. Stonehill CRE is targeting over $500 million in transactions for 2023. Stonehill CRE’s transactions that have closed include: mixed-use development – Opus Atlanta in Atlanta, GA; retail centers in New Jersey and Kentucky; land development loans on growing markets in the Southeast; and the purchase of a non-performing office loan in Washington, D.C. Stonehill CRE is also finalizing transactions on projects in multifamily, office, build-for—rent development, and an additional retail project.

Pebblebrook Hotel Trust successfully refinanced $2 billion of credit facilities and term loans, resulting in a $650.0 million senior unsecured revolving credit facility and term loans totaling $1.4 billion. The $650.0 million Credit Facility’s maturity was extended to October 2027, inclusive of two optional six-month extensions. The $460.0 million term loan matures in October 2024. The second $460.0 million term loan matures in October 2025. The third $460.0 million term loan matures in October 2027. With the completion of this refinancing, the Company has no meaningful debt maturities until October 2024.

A joint-venture affiliate of Gencom and Mohari Hospitality announced the closing of a $191 million refinancing with Blackstone Real Estate Debt strategies. The refinancing encompasses the Four Seasons Resort Costa Rica and Andaz Costa Rica, along with other capital projects at the 1,400-acre master-planned resort and residential community which Gencom and Mohari Hospitality acquired in 2016. In addition to completing significant renovations to the Four Seasons and Andaz Costa Rica Resorts, Gencom and Mohari have also broken ground on a new Ritz-Carlton Reserve that will open in late 2024. The new ultra-luxury development includes 107 keys and 36 branded villas and estate homes. Lotus Capital Partners acted as a financing advisor to Gencom and Mohari on these transactions.

Four Seasons Hotels and Resorts announced its board of directors had appointed Alejandro Reynal as president and CEO effective October 17. Reynal succeeds John Davidson who announced his intention to retire late last year and remains a member of the board of directors. Reynal most recently served as president and CEO of Apple Leisure Group.

Vacasa is shuffling its executive team just weeks after the installation of new CEO Rob Greyber. Company regulatory filings state Chief Product Officer Michael Xenakis is leaving the company at the end of October and Chief Revenue Officer Michael Dodson is leaving in early November. At the same time, executives Craig Smith and John Banczak are moving into new roles. Smith, who was previously chief operating officer, is moving to the role of chief commercial officer. Banczak, previously chief strategy officer, is moving into the position of COO effective immediately. Greyber is taking over the chief product officer role on an interim basis. 

Europe Highlights

IHG Hotels & Resorts announced the signing of voco Brussels City North, marking entry into a new market. IHG is partnering with Living Tomorrow on the first of its kind in Belgiumvoco Brussels City North. Due to open in autumn 2023, the 92-key voco Brussels City North will be operated by Prem Group. The hotel will feature a restaurant and conference center and will adjoin the Innovation Centre. Now present in more than 15 countries, there have been 40 openings and 34 more properties entering the pipeline since voco hotels launched in 2018. In Europe alone, there are currently 15 open hotels with a further 14 hotels in the pipeline.

IHG Hotels & Resorts also announced the signing of a new voco hotel in Paris, voco Paris Porte de Clichy, marking the country’s sixth voco hotel signing. The new hotel will be a 264-key conversion property and has recently been signed in conjunction with Catella Hospitality, it is the second voco property in the city of lights. Due to open in summer 2023, voco Paris Porte de Clichy will feature several food and beverage outlets, as well as meeting spaces. 

The Hoxton is set to expand its global community, with seven hotels lined up to open in some of Europe’s key cities by early 2024. The Hoxton will open its fourth London hotel in Shepherd’s Bush this December, followed by a huge 18 months with openings in Brussels, Amsterdam, Berlin, Edinburgh, Vienna and Dublin. The hotels are: Shepherd’s Bush with 237 rooms; Brussels, opening spring 2023 with 198 rooms; Amsterdam, opening spring 2023, the second property in the Eastern Docklands district will offer 136 rooms; Berlin, opening summer 2023 with 234 rooms; the 211-room Edinburgh property is opening in summer 2023; Vienna will be opening in late 2023 with 196 rooms; and opening in 2024 in Dublin with 129 rooms. Amenities at all properties include food and beverage venues and meeting and events space.

Alan Woinski and Kim Woinski
October 17th, 2022 at 4:19 PM EDT

Companies: AC Hotels by Marriott, Aimbridge Hospitality, Candlewood Suites, Catella Hospitality, Choice Hotels International, Driftwood Capital, Element, Ennismore, Extended Stay America, Extended Stay America Premier Suites, Four Seasons, Hampton by Hilton, Hilton Hotels & Resorts, Holiday Inn, Home2 Suites by Hilton, IHG Hotels & Resorts, Kimpton, Mainstay Suites, Marriott International, Moxy Hotels, Pebblebrook Hotel Trust, Ritz-Carlton, Stonehill, Tharaldson Hospitality Management, The Hoxton, Vacasa, Voco

Locations: Alabama, Belgium, California, Costa Rica, Florida, Kentucky, New Jersey, New Orleans, New York City, North Carolina, Paris, Pennsylvania

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