Global Tourism Sector Will Almost Recover in 2023

The DJIA was down 56 points but Nasdaq was up 22, the S&P 500 rose 2 points and the 10-year treasury yield seems to be the best trade these days, back up to 3.52%, up .08 today. Lodging stocks were modestly lower. ABNB was the only mover of note, up 5% while SLNA traded down to another all-time low before getting a little bounce.

Hilton Grand Vacations announced its board of directors approved a two year share repurchase plan authorizing the company to buy back up to an aggregate of $500 million of its outstanding shares of common stock. The new plan will go into effect as soon as the existing two year repurchase program, authorized by their board of directors in May 2022 for $500 million, is fully completed. As of April 30. 2023, HGV had approximately $83 million remaining under the prior repurchase program.

The World Travel & Tourism Council said the global travel and tourism sector won’t fully recover this year, but it will get close. According to the WTTC’s 2023 Economic Impact Research, the sector is forecast to reach $9.5 trillion in 2023, just 5% shy of its GDP contribution in 2019. WTTC expects 2024 to exceed 2019. By the end of 2022, tourism levels in 34 countries, out of 185 that were analyzed, rebounded to pre-pandemic levels in terms of GDP contribution. Countries leading the charge include the U.S. and Dominican Republic. WTTC’s research predicts that at least 50 more countries will meet, or be within 95% of reaching, this target by the end of this year. WTTC forecasts Europe, the Middle East, Africa, and Asia-Pacific will recover in 2024 and the Caribbean is expected to recover by 2025. This year, jobs in the travel and tourism sector will recover to 95% of 2019 levels, according to the report. In 2019, 334 million people worked in the travel sector. By 2033, the WTTC forecasts the travel sector will employ some 430 million people around the world. Travel demand in many regions surged in 2021 and 2022, as a steady stream of border reopening kept travel momentum high. We can’t expect that momentum to continue into 2023, according to a forecast published by Riskline. According to Riskline’s report, higher airfares and hotel rates will severely limit travel in 2023. Travel disruptions, geopolitical turmoil and corporate sustainability practices will also take a toll. The report, published last week, shows that while willingness to travel varies around the global, overall intent is trending up, bolstered by demand in South Korea and Western Europe. Travelers still prefer cutting travel costs to canceling their plans. Bleisure travel is on the rise, particularly for trips that are primarily related to work. Domestic travel demand is cooling in the U.S. this year, but Americans are planning to travel internationally more often. Big city travel is rebound, as concerns about Covid-19 are not materially influencing travel behaviors in the U.S. as they are in parts of Asia.

Georgia World Congress Center Authority announced reservations beginning March 15, 2024 for stays at Signia by Hilton Atlanta. The new 976-room hotel will offer direct access to the Georgia World Congress Center via a pedestrian walkway. The property boasts more than 100,000 square feet of flexible meeting space including the largest ballroom in Georgia, six signature food and beverage experiences, a spa and beauty bar, and a fitness center.

InterContinental Chicago Magnificent Mile announced the launch of its biggest renovation yet with a planned completion by June 2023. Featuring 477 rooms, InterContinental Chicago Magnificent Mile’s Grand Tower will be fully transformed. Later this fall, highly anticipated culinary additions will arrive at the hotel including a new restaurant concept featuring Latin fusion cuisine. The longstanding fine dining steakhouse will also be touched by the refresh and will welcome an elevated outdoor dining experience off its second floor restaurant. InterContinental Chicago Magnificent Mile offers restored event spaces and a spa featuring a junior-size Olympic pool.

Bunkhouse Hotel group is set to break ground on its first Houston, Texas hotel, Hotel Saint Augustine. The new construction property will have 71 rooms on two floors, an event space restaurant and bar, and is expected to open in the fourth quarter of 2024. The project’s developer is the Marchbanks Company, which collaborated on several other Bunkhouse properties. 

Plans for the next luxury hotel in Orlando, Florida have moved forward thanks to a $16 million land purchase for the project. Orlando 5 Stay Hotel Owner LLC, an entity with executives tied to Development Ventures Group (Deven), has acquired a 28-acre parcel of land off International Drive from GCB Associates LLC. In 2021, Deven and Accor SA announced plans for the new 7-story Fairmont Orlando hotel opening in early 2025. Past permits and announcements have shore more on the $425 million project including: a 550-room hotel with 90 suites, 12 villas and 87 Fairmont Gold VIP rooms; seven elevated dining experiences, a spa and wellness center and three pools. 

Plans for a nine-story, mixed-use hotel building in Asheville, North Carolina, have gotten a little bit bigger. On May 3, the city’s Planning and Zoning Commission signed off on a project update which would grow it to 32 hotel guest rooms and 23 condos. The 2,000 square feet of commercial space remains the same as the previous proposal as does the 43 parking spaces. The newest plans contain two hotel floors and five condo floors. According to BPR Properties, construction will likely start early to mid-2024 with construction estimated to take 18 months.

Miami-Dade County could award a $240 million contract to Fontainebleau Development and Related Cos. to build a hotel at the Miami International Airport. FDR Miami Hotel LLC is the developer for the project. The resolution will go before the Miami-Dade Airport and Economic Development Committee and could go to the full County Commission on June 6. The board will decide to establish a revenue-generating lease agreement for the design, building, financing, operation and maintenance of a new 451-room hotel for the Miami-Dade Aviation Department. The developers are seeking a 50-year lease and the rental of parking spaces in a garage for valet service. The Federal Aviation Administration would also need to give approval. The hotel would feature a restaurant/bar, another rooftop restaurant, a pool, meeting/event space and a fitness center and spa. A pedestrian bridge would connect the hotel to Concourse D.

Best Western Hotels & Resorts announced the opening of the Best Western Ontario in Ontario, California. Owned by Verdant Ontario Mills LLC, the property features 105 rooms consisting of 83 executive guestrooms and 22 suites, a fitness center, outdoor heated pool and spa and guest laundry facilities.

According to MILENIO, Iberostar will reactivate its global expansion plan and will invest more than 60 million dollars in Mexico over the next three years for three new resorts. The expansion plan includes building a 300-room hotel in Nayarit and a two hotel project in Las Cabos, Baja California Sur with approximately 1,000 rooms. Last year Iberostar established an alliance with IHG and reached agreements in which they established they would focus only on lodging places in beach destinations. The agreement is for Iberostar to market up to 70 hotels located on the beachfront, which will be integrated into the IHG system under the Iberostar Beachfront Resorts brand. 

Isla Mujeres, located 8 miles off the coast of Cancun, Mexico, announced a new boutique hideaway. Secrets Impression Isla Mujeres will be part of the Inclusive Collection when it opens on May 26, 2023. The resort features 125 suites, eight dining venues, a spa, oceanfront hot tubs, tiered infinity pools and extravagant rooftop pools.

Quartz Inn Hotels announced its arrival in Mexico with the addition of Casa Antares Hotel in Queretaro, marking the group’s first property outside of Europe. The hotel, now renamed Casa Antares by Quartz Inn Hotels, has 15 rooms. Quartz Inn Hotels plans to continue expanding its franchisees throughout Latin America, with the goal of having 200 establishments by 2025. 

Hoteles City Express announced the hotel chain’s next project is the launch of Fibra Stay, after having completed the sale of the hotel brand in Mexico to Marriott International. Hoteles City Express and Marriott International announced the new alliance includes the sale of the hotel chain’s five brands in Mexico, as well as its loyalty program City Premios Rewards to Marriott International, who paid 100 million dollars for the acquisition. 

Genesis Hospitality sold the Victoria Inn Hotel and Convention Center, located in Thunder Bay, Ontario, to Naagaaniiyang Limited Partnership. 

DoubleDragon Properties Corp. announced plans to build 10 hotels in the United States by 2026. DoubleDragon stated that Hotel101 Global Pte. Ltd. is set to acquire its first U.S. property by the third quarter of the year. Aside from Philippines, Japan, Spain and the U.S., DoubleDragon is also looking at the United Kingdom, the UAE, India, Thailand, Malaysia, Vietnam, Indonesia, Saudi Arabia, Singapore, Cambodia, Bangladesh, Mexico, South Korea, Australia, Canada, Switzerland, Turkey, Italy, Germany, France and China for its global expansion.

Europe Headlines

The long-delayed Hyatt Regency London Blackfriars will finally open next month, with bookings available at the former Crowne Plaza London The City hotel from June 1. 

Mazabi has bought the Aragon Hills & Spa hotel, located in the Formigal-Panticosa ski resort, for an undisclosed sum from an unknown seller. The Formigal, Spain property has 157 rooms and the new owners are searching for an operator to run the asset. With this latest acquisition, Mazabi now has 19 hotel assets.

Cycas Hospitality announced its appointment to manage the Grandhotel Bad Pyrmont spa hotel near Hanover, Germany, its 4th property in continental Europe. Comprising two adjoining properties, the hotel includes 151 guestrooms within the Steigenberger Hotel and Spa and the 44-room Furstenhof Hotel. The hotel is set to commence an extensive 20M Euro refurbishment later this year across rooms, public areas and spa facilities. The hotel’s spa facilities include Serail spa bathing areas, Hammam, sea salt grotto and spring water tastings in the nearby Hylligen Born. The hotel also features a total of five meeting rooms including a classic ballroom, on-site parking and terrace access for private receptions.