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North America

Truist Sees Normalization of U.S. Demand for Short-Term Rentals

Alan Woinski and Kim Woinski
June 8th, 2023 at 4:31 PM EDT

Skift Take

  • Stock market sees mixed performance, with DJIA and Nasdaq rising while lodging stocks show mixed results.
  • Wells Fargo initiates coverage on Airbnb with an Underweight rating.
  • Significant developments in the hotel industry, including new hotel projects in Ann Arbor, Ottawa, Mexico City, and Portland, as well as the restoration of Book Tower in Detroit.

The DJIA rose 169 points, Nasdaq was up 134, the S&P 500 rose 26 points and the 10-year treasury yield was down .07 to 3.71%. Lodging stocks were mixed. AHT was the only mover of note, down -6% on the day.

Wells Fargo initiated coverage on Airbnb with an Underweight rating and $99 price target.

Truist Securities published a report on ABNB and the short-term rental business following their attendance at Skift Short-Term Rental Summit. Truist said they came away with two key high-level themes that most panels and conversations centered around. The consensus is there will be a normalization of domestic demand and pricing following significant strength from 2020-2022. Growth will still be 10.4% in 2023 and 8.5% in 2024. Truist said for ABNB they don’t believe decelerating growth rates will lend themselves to expanding valuation multiples. The second takeaway is that there are opportunities for market shares gains with A.I. That was the undertone about future technology but that was light on details. Bringing in professional management for short-term rentals also would help alleviate customer push-backs. Currently individual hosts account for 85% of STR supply.

Just like with their equity offering, Ryman Hospitality Properties upsized their senior notes offering. RHP upsized the offering of 7.250% senior notes due 2028 to $400 million from $300 million.

STR reported US lodging data for the week ended June 3. US hotel RevPAR was down -1%. While it was a clean comp with Memorial Day, it also showed that leisure travel is not the dominant segment anymore as the lack of group travel during a holiday resulted in negative RevPAR growth.

Bacall Companies announced plans for a four-story, 100 room Springhill Suites Marriott-branded hotel to be built in Ann Arbor, Michigan. Groundbreaking for the new hotel is planned for Spring 2024.

Construction began on a new 194-room hotel in the Playhouse Village District of Pasadena, California. The six-story hotel by Welcome Group is expected to open in the summer of 2024. The hotel will feature a rooftop bar and lounge, a bar and café, event space and 5,000 square feet of leasable space on the first floor. This is R.D. Olson Construction’s second AC Hotel for Welcome Group, Inc.

IHG Hotels & Resorts announced the opening of the new Holiday Inn Express & Suites Springdale – Fayetteville Area in Springdale, Arkansas. The 87-room property features a fitness center, outdoor pool, patio and fire pit. The Holiday Inn Express & Suites Springdale – Fayetteville Area is owned by Springdale Hotels, LLC and managed by Titus Management Group.

The developers who plan to remake Bahia Mar got their approval from the Fort Lauderdale commission. Jimmy Tate and his partners plan to build four 21-story condo towers with a total of 350 units; a 23-story hotel with 256 rooms and 60 luxury condo apartments; a marina village with restaurants and bars; a waterfront restaurant; a park and a public waterfront promenade. The new plan will leave Bahia Mar’s 245-slip marina untouched. 

Construction has officially started on Ottawa’s future Hard Rock Hotel & Casino Ottawa. A groundbreaking ceremony was held at the Rideau Carleton Casino, Future Hard Rock where it will host the new facility. Canada’s first Hard Rock Hotel & Casino will include: a 150-room Hard Rock Hotel, including 22 suites; an expanded Hard Rock Casino with 1,500 slot machines, 40 live-action table games, a Hard Rock Sportsbook and a Baccarat room; a 1,800 seat Hard Rock Live theatre; more than 10 restaurants, bars and lounges; and retail outlets. The completion of the $350 million Hard Rock Hotel & Casino Ottawa is planned for Spring 2025. Rideau Carleton Casino will continue to operate until the renovation and rebranding of the property to the Hard Rock Hotel & Casino Ottawa is complete.

Bunkhouse announced the opening of Hotel San Fernando, in the popular La Condesa neighborhood of Mexico City, Mexico. The re-imagined hotel features 19 rooms across five floors, a lobby bar and lounge, lobby retail shop and a rooftop terrace.

Lark announced the debut of four new Lark Independents along North Carolina’s southern shore: The Beach House and The Starlite Inn in Carolina Beach; and The Admiral’s Quarters Motel and The Sand Dunes in Kure Beach. The independently-owned boutique hotels will now be managed and operated y Lark, growing its portfolio of Lark Independents to 18 hotel properties throughout the U.S. 

Half Moon Bay Lodge, an 80-room hotel located in Half Moon Bay, California, has completed a refresh, with updates to the hotel’s guest rooms, outdoor public spaces, and 5,000 square feet of indoor and outdoor function space. Half Moon Bay Lodge is owned by the Melville Family and is managed by Pacifica Hotels.

Clark County, Nevada approved a 340-room hotel to be located within walking distance from Allegiant Stadium. The 19-story Nuance Las Vegas, which is expected to break ground early next year, will host a restaurant, day spa, ballroom and convention hall. The estimated $275 million project is being developed by New Angle Development. The Nuance Las Vegas’ first floor will include a lobby, while the parking garage will be set on levels two through five. The ninth floor will hold the restaurant, while floors 10 through 18 will be used for guest rooms. The top level will have a deck and five “high-end” guestrooms. 

Uncommon Hospitality announced the Longfellow Hotel, located in the West End neighborhood of Portland, Maine, is now accepting reservations with an anticipated opening in September 2023. The five-story, 48-room property comprises a wellness spa, a café and a lobby bar. The Longfellow will also debut as a member of Small Luxury Hotels of the World.

Following the 7-year, nearly $400 million restoration of Book TowerBedrock and Method Col announced that ROOST Detroit will officially open and is now accepting reservations for stays starting June 1. Method Co. and Bedrock additionally unveiled Book Tower’s special events program, Anthology, an elevated hospitality experience spanning several beautiful event venues. ROOST Detroit features hotel accommodations, a bike-share program, fitness center, and 3,000 square feet of co-working space. Special event spaces will include the 2,800-square-foot Conservatory Ballroom, The Linden Room and Graystone Lane. Book Tower has 229 residential units and 52,000 square feet of retail and office space, including three new dining concepts. 

Personnel Moves

hihotels by Hospitality International announced the return of Ron Lohnes as Franchise Development and Assurance & Marketing Program Director for the Southeast Region. Lohnes will help grow hihotels’ five distinct brands: Scottish Inns, Red Carpet Inn, Master Hosts Inns, Downtowner Inns and Passport Inn, in Florida, Georgia, South Carolina and North Carolina, while also delivering ongoing sales and marketing support and training to franchisees in those states as part of the company’s Assurance & Marketing Program.

Hospitality Ventures Management Group appointed Bryan Gatzemeyer as vice president of business intelligence. Gatzemeyer will lead HVMG’s data and analytics strategy, and his appointment punctuates the company’s commitment to data-centric decision making using AI and machine learning to drive performance.

Alan Woinski and Kim Woinski
June 8th, 2023 at 4:31 PM EDT

Companies: Airbnb, Ashford Hospitality Trust, Bunkhouse, Hard Rock Hotels & Casinos, Hard Rock International, hihotels, Holiday Inn Express, Hospitality International Inc., Hospitality Ventures Management Group, IHG Hotels & Resorts, Lark Hotels, Marriott International, Roost Apartment Hotel, Ryman Hospitality Properties, Springdale Hotels, SpringHill Suites, Standard International, Truist Securities, Uncommon Hospitality, Welcome Group

Locations: Arkansas, Detroit, Las Vegas, Los Angeles, Mexico City, Miami, Michigan, Nevada, North Carolina, Ottawa, Portland Maine, San Francisco

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