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North America

Pebblebrook Sees Demand Soften a Bit

Alan Woinski and Kim Woinski

June 25th, 2023

Skift Take

  • Stock market: DJIA fell 219 points, Nasdaq was down 138, and S&P 500 fell 34 points.
  • Pebblebrook Hotel Trust warns of weaker weekend leisure travel and expects slightly lower 2Q revenue.
  • Various hotel announcements: HHM Hotels launches Echelon Luxury & Lifestyle division, Driftwood Capital acquires Hilton Dallas/Plano Granite Park, LBA Hospitality opens Homewood Suites by Hilton in Greenville, Renaissance Cleveland undergoing renovations, and more.

The DJIA fell 219 points on Friday while Nasdaq was down 138, the S&P 500 fell 34 points and the 10-year treasury yield was down .06 to 3.74%. Lodging stocks were mixed. SOND was the big mover, down -9%.

Pebblebrook Hotel Trust released its monthly update and this was more of a warning. PEB said weekend leisure travel has been weaker than expected and that is coupled with cooler weather in Southern California and Pacific Northwest along with some tightening of the belts on suites/premium rooms. PEB said 2Q revenue is expected to fall slightly below their outlook. Hotel EBITDA/adjusted EBITDA and Adjusted FFO are supposed to be in line. As for what to think, CEO Jon Bortz has purchased 43,000 more shares on the open market since June 20.

HHM Hotels launched Echelon Luxury & Lifestyle, a newly formed business division. Of the 240 properties managed by HHM Hotels, Echelon represents more than 50 hotels and resorts across the country. Echelon Luxury & Lifestyle’s operational edge aims to drive bookings and direct business for owners through omni-channel distribution initiatives focused on maximum penetrations within a range of consumer markets. Echelon is centered around a suite of creative divisions and in-house studios. The Culinary Studio develops food and beverage programs while its Creative Studio develops full-service creative and branding services. 

Driftwood Capital acquired the Hilton Dallas/Plano Granite Park, located within the 90-acre master-planned, mixed-use community of Granite Park in the north Dallas suburb of Plano. Driftwood Capital plans to renovate the hotel’s guestrooms and meeting space, and Driftwood Hospitality Management has assumed management responsibilities. The hotel boasts 299 guestrooms, 33,833 square feet of meeting and event space, two dining options, a marketplace, a fitness center, business center and outdoor pool.

LBA Hospitality announced the opening of the Homewood Suites by Hilton in Greenville, North Carolina. Owned by BPR Properties, the 118-suite hotel offers 625 square feet of meeting space, a business center, fitness center, guest laundry and a convenience store.

Renaissance Cleveland, in Ohio, announced the revamp of the hotel. The guestrooms have been totally transformed, the ballroom will soon be transformed, and the lobby is getting a new restaurant and bar. The property will open as Hotel Cleveland in 2024.

Eastdil Secured has been hired by a joint venture between Manchester Financial Group and Colony Capital to market the 37-story, 1,048-room Fairmont Austin in Austin, Texas. The hotel is valued at just over $600 million and bids are expected to start at around $602 million. If the hotel sells for even half that amount, it would break the record for the priciest hotel transaction ever in Austin. The hotel features 129,000 square feet of meeting space, plus high-end restaurants and bars, a spa and a rooftop pool.

IHG Hotels & Resorts announced the opening of its newest Candlewood Suites hotel in Joliet, Illinois. The 86-suite property features more than 13,000 square feet of meeting and event space, a gym, indoor pool and onsite restaurant. The Candlewood Suites Joliet Southwest is owned by Joliet CW Hotels, LLC and managed by Hospitality Guru Group.

The Wentworth, in Jackson, New Hampshire, announced completion of a hotel-wide renovation that began in fall 2022. The $4 million dollar investment project touched all aspects of the 150 year-old inn including its 61 rooms and suites, the lobby, exterior public and event spaces, new Alpine tavern, and more. The Wentworth also offers a new wedding and event tent, a fine dining restaurant, a heated pool, clay tennis court, volleyball, on-property ice skating in the winter and more. The hotel is owned by Atlantic Equity Partners, LLC and managed by Meyer Jabara Hotels

Desolation Hotel announced its expansion to a second Sierra Nevada location: Desolation Hotel Hope Valley, located in Hope Valley, California. The family-owned hotel brand now offers two ways to explore the Northern California region and runs shuttles between the two properties. Formerly known as Sorensen’s Resort, the Desolation Hotel Hope Valley offers 27 cabins, 7 luxury yurts, a restored 1951 Spartan Trailer, and campgrounds for RV and tent camping including 13 sites across 15 acres. Amenities include a wood-fired sauna, general store, all-day dining destination and more.

A $65 million to $85 million beach resort with a private airport planned for Bolivar Peninsula, Texas has secured a hospitality company. The Peninsula Beach Resort in Crystal Beach will be managed by CoralTree Hospitality. The hospitality company will manage all parts of the 110-acre resort, which is planned to include 90 single-family beach homes, 117 rental cottages with a clubhouse and two pools, 50 RV sites with overhead cabins, five beach condo towers totaling 160 units, a restaurant and spa, and a three-level beachside bar and grill, according to developer Bolivar Investment Group.

Liberty Township, Ohio has approved a mixed-use development for apartments and a hotel. The proposed Liberty Center is a $350 million project consisting of 264 luxury apartments and a 145-room hotel. Amenities would include a dog park, clubhouse, private saltwater pool and a gym with a yoga room. The developer of the five-story project is Dobbins Group and Bayer Properties LLC

Plans to develop the site of a Borden Dairy in East Austin, Texas, are nearing approval from the city council. Councilmembers voted in favor of a rezoning that would allow the project to advance. Endeavor Real Estate Group wants to rezone the 21-acre site to make way for a mixed-use development that would include 1,400 apartments, a 220-room hotel and three office buildings as well as about 100,000 square feet of restaurant and retail space. 

Belmond is opening a new luxury hotel called Milaroca in Riviera Nayarit, Mexico. The hotel will be constructed within a 105-acre beachfront estate and is expected to open in 2025. The hotel will offer 57 guest accommodations as well as 27 residences, six dining venues, an organic farm, four pools, a wellness center and a retail outlet. This will be Belmond’s third hotel in Mexico. 

China Oceanwide is low on cash and selling roughly 17 acres on the island of Oahu in Hawaii for $134 million. The buyer is managed by Tower Development. The developer wants to build a 400-key luxury resort on the property along with 450 luxury branded residences. A brand name is expected to be identified after the deal is complete. The property is called Lot 2 at Ko Olina. China Oceanwide plans to use the sale’s proceeds to settle transaction costs, outstanding payables and indebtedness. The developer also expects to sell a yet-to-be-completed, mixed-use property in downtown Los Angeles along with another property in Hawaii and another in New York. 

Kalahari Resorts and Conventions recently opened an expansion to its Outdoor Waterpark in Round Rock, Texas. The expansion includes a children’s play area with nine new slides, an adults-only swim-up bar, and a 900-foot Adventure River. 

The Cache Valley Mall in Logan, Utah, could be knocked down later this year in favor of a large-scale mixed-use of the space. What’s being deemed the Cache Valley Marketplace calls for the demolition of Cache Valley Mall in favor of a large tenant, 342 apartments and a 156-room hotel, a $205 million project altogether. The ground floor of the hotel would be reserved for commercial and restaurant tenants with three floors of hotel space above. According to the developer, Woodsonia Real Estate, Inc., the project would be scheduled to begin the fourth quarter of 2023 or the first quarter of 2024, with the retailer opening two years later. 

HREC Investment Advisors arranged the sale of the 100-unit Hampton Inn & Suites St Paul Oakdale/Woodbury, Minnesota. The buyers are a group of experienced hotel owners, led by Jaymin Patel. HREC Investment Advisors exclusively represented the seller, Skeiron Realty LLC, on this transaction. 

JLL Hotels & Hospitality Group arranged the sale of the Hampton Inn & Suites Fredericksburg South, a 121-key hotel in Fredericksburg, Virginia. JLL represented the seller, Sachs Companies Realty Investments. The five-story hotel offers 1,890 square feet of meeting space, an indoor pool and hot tub, fitness center, business center and guest laundry.

Europe Highlights

Accor completed the disposal of its headquarters building, Sequana Tower, for €460 million to The Valesco Group. The transaction is the largest office deal of the year in Continental Europe and the largest in France since 2022. The transaction structure includes a 12-year-sale and leaseback agreement with an initial annual rent of €22 million and existing shareholder loan of €100 million. Colliers acted as broker for the transaction. 

Zeal Hotels signed an Exclusivity Agreement with IHG Hotels & Resorts for a hotel, which will be managed by Valor Hospitality. The upscale lifestyle property in Exeter, U.K. is due to open in Q4 next year and will be the first net zero carbon branded hotel. Located in Exeter Science Park, locally-sourced food and beverage will be a focal point of the hotel operation. The property will also feature a meeting room and gym.

Alan Woinski and Kim Woinski

June 25th, 2023

Companies: Accor, Belmond, Candlewood Suites, China Oceanwide Holdings Ltd, Driftwood Capital, Echelon Luxury and Lifestyle, Fairmont, Hampton by Hilton, HHM Hospitality, Hilton, Hilton Hotels & Resorts, Homewood Suites by Hilton, HREC Investment Advisors, IHG Hotels & Resorts, JLL, Kalahari Resorts and Conventions, Meyer Jabara Hotels, Pebblebrook Hotel Trust, Sonder Holdings Inc., Zeal Hotels

Locations: Austin, California, Cancun, Cleveland, Dallas, England, Illinois, Mexico, New Hampshire, North Carolina, Oahu, Ohio, Texas, Utah

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