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North America

JP Morgan Is a Bit More Enthused About Hyatt

Alan Woinski and Kim Woinski
September 11th, 2023 at 5:58 PM EDT

Skift Take

  • Financial markets showed mixed performance with the DJIA, Nasdaq, and S&P 500 rising while the 10-year treasury yield also increased.
  • JP Morgan expressed optimism about Hyatt’s future, anticipating growth in RevPAR and an asset-light business model.
  • Various hotel-related developments were reported, including property sales, renovations, and new openings, with several companies expanding their portfolios.

The DJIA rose 87 points, the Nasdaq was up 156, the S&P 500 rose 30 points, and the 10-year treasury yield was up .03 to 4.29%. Lodging stocks were mixed. BHR was up 7%, but that was the only big gainer. SOND was down -8%, AHT was down -6%, and SHCO was down -5% today.

JP Morgan reported on investor meetings they held with Hyatt. JPM said they came away incrementally enthused about Hyatt and its multi-year opportunities and transformation to an increasingly asset-light business model. Hyatt said the seasonally driven transition to group and individual business transient travel mix is starting in the U.S. and should replace leisure for the balance of 3Q23 and 4Q23, accelerating RevPAR growth relative to the summer. U.S. group occupancy is currently at 1,000 basis points below 2019 levels. In the near to medium term, Hyatt conveyed confidence in sustaining above-peer net rooms growth and growing fees per room in excess of net rooms growth.

Truist held a conference call with Michelle Russo, CEO and founder of HotelAVE, and CIO Loren Balsam. Truist said the key points included 2024 RevPAR is forecasted at +5.8% year over year with ADR up 4%, led by corporate and group business. They do expect leisure RevPAR to be slightly up. Above-inflationary costs continue in property-level operations, hurting margins, and there are several union renegotiations through Y.E. 2024. Truist said HotelAVE expects corporate demand to be 85% of 2019 levels next year and group demand to equal 2019.

The eight-story, 165-room Element Orlando hotel at 8278 Universal Boulevard was sold by PG-PHG Orlando LLC, an entity related to Peachtree Hotel Group, to GPIF Orlando Hotel Owner LLC, an entity related to Crescent Real Estate LLC, for $39 million.

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The Aloft Denver Downtown has reopened, unveiling an approximately $3 million makeover, boasting updated guestrooms, lobby, food and beverage spaces, fitness center, social lounge, and more. The Denver, Colorado hotel offers 140 guestrooms and over 1,400 square feet of meetings and event space. Aloft Denver Downtown is owned by JBK Hotels and managed by Azul Hospitality Group.

TownePlace Suites by Marriott Hotel will open in Coeur d’Alene, Idaho, at the end of November. The four-story property will offer 83 rooms and suites, a pool, hot tub, fitness room, a lobby for gatherings, and a breakfast area. 

Crawford Hoying announced the acquisition of Homewood Suites by Hilton Columbus OSU in partnership with Shaner Hotel Group. The Columbus, OH, hotel features 109 guestrooms, 725 square feet of event space, a meeting area, a workout facility, an indoor pool, and more. 

LuxUrban Hotels Inc. announced that the Blakely Hotel in New York City has been rebranded as The Blakely by LuxUrban, Trademark Collection by Wyndham. The 117-room, English-style boutique hotel is the first LuxUrban property to integrate under the Wyndham Hotels & Resorts brand family.

Waterton announced the official launch of its new Outbound Hotels brand, a collection of locally-minded hotels offering differentiated lodging options for lifestyle travelers seeking outdoor-inspired experiences in boutique settings. The vision of the Outbound Hotels brand began with Waterton’s acquisition of The Virginian Lodge in Jackson Hole, WY, in 2020. Acquired in partnership with Orion Companies, it has been rebranded as The Virginian Lodge, an Outbound Hotel. The Outbound portfolio, operated by Springboard Hospitality, was expanded in 2021 with the acquisition of Outbound Mammoth, formerly the Sierra Nevada Resort in Mammoth, California, and Towne and Country Stowe in Stowe, Vermont, acquired by Waterton in March 2023. Most recently, Waterton partnered with Argosy Real Estate Partners to bring its repositioning and redevelopment acumen to a 17-acre Qualified Opportunity Zone site in Oakhurst, CA. The property will be developed as Outbound Yosemite Resort, a 135-key outdoor-inspired hotel with 108 new vacation rental cabins and 14 hotel rooms in addition to the 13-key boutique hotel currently on the site. 

Foley Entertainment Group has purchased a majority stake in the 6-acre, 25-room Farmhouse Inn, a luxury hotel in Forestville, CaliforniaCatherine and Joe Bartolomei acquired the Farmhouse in 2001. Foley Entertainment Group will immediately take over daily operations of the inn, but the Bartolomeis will continue to be active in the property’s future. 

Margaritaville Resort Lake Tahoe is scheduled to open on November 17, 2023, in South Lake Tahoe, California, marking the brand’s first footing into a ski resort destination. The family-friendly resort will include several onsite dining options, an indoor pool, and a street-front bar on the exterior of the new resort.

The Privatization Commission has started to appoint a financial adviser to undertake leasing the Roosevelt Hotel in New York and setting up a joint venture project for prospective mixed-use development. The Roosevelt Hotel will be converted into a 40-story multi-purpose complex serving as a business hub. PIA Investments Ltd owns the hotel. It was closed in 2020 due to financial losses. 

Hotel Sequoia, in Redwood City, California, is slated for a revamp after planning commissioners approved plans by Sequoia Main Street LLC to rehabilitate and expand the century-old building. The renovation plans include expanding the site from a 53-room hotel into an 82-room boutique hotel. Three additional floors would be added to the hotel, creating space for more rooms and a rooftop penthouse, bar, and event space. A new basement level would also be constructed to house a dining and meeting room, fitness area, wine room, and other utility uses. A restaurant, a small retail space, and a remodeled foyer and bar will replace ground-floor commercial spaces.

National Hospitality Services, an affiliate of Hotel Equities, announced that with its latest addition of two North Dakota hotels, the company has reached a milestone achievement of 40 hotels under management across the United States. In addition, NHS recently introduced “InnSight Advisor Services,” a comprehensive suite of services that positions the company as a trusted partner for hoteliers aspiring to acquire and own a successful hotel. The suite includes services such as feasibility evaluations, brand negotiations, debt sourcing, financing, construction management, and investment opportunities in hotel projects.

Best Western Hotels & Resorts announced the opening of the Best Western Shackleford, located in Little Rock, ArkansasRahul Patel owns the hotel, which features 40 standard guest rooms and 20 suites. The Best Western Shackleford recently underwent a nearly $1 million renovation. The new design showcases modern furniture and finishes throughout the common spaces, including the lobby, sitting area, and breakfast bar. Additionally, each guest room has been refreshed and features re-imagined bathrooms. The property offers a renovated fitness center, indoor pool, 700 square feet of meeting space, and free parking. 

Yellowstone Real Estate Investments acquired the loan on the New Yorker Hotel in the Hell’s Kitchen neighborhood of Manhattan, valued at $106M. The loan-to-value ratio for the senior mortgage was 43% for the art deco building containing a Wyndham-branded, 1,000-key hotel, 140K square feet of student housing, 110K square feet of office space, and 16K square feet of retail space. The landmarked property’s former lender, M&T Bank, has been shopping around for a buyer for the loan since mid-July. 

Pebblebrook Hotel Trust successfully refinanced its mortgage loan on the 369-room Margaritaville Hollywood Beach Resort in Hollywood, Florida. The $140.0 million secured loan has a three-year initial term with two one-year extension options, subject to the satisfaction of certain conditions. The company executed interest rate swaps to establish a fixed interest rate of 7.0% throughout the loan’s duration. Wells Fargo Securities, LLC served as the Sole Lead Arranger in forming a syndicate of lenders for the financing, and Wells Fargo Bank, NA will serve as the administrative agency. 

Banco BHD announced it would be providing financing of US$8,900,000 to Bio Investment Group for the construction and launch of TRYP by Wyndham Punta Cana hotel project. The project is sponsored by Grupo La Chapelle and Coral Hospitality Corp. S.A., with Coral Hospitality Group acting as the hotel operator. The TRYP by Wyndham Punta Cana is scheduled to begin operations in December 2024 and will feature 97 rooms and a commercial area of 2,200 square meters. The hotel will offer amenities such as a lobby bar, executive restaurants, pool, gym, meeting and business center, and underground parking for guests. 

Personnel Moves

Sonder Holdings Inc. announced the appointment of Katherine Potter as General Counsel, effective September 11, 2023. Potter was most recently Chief Executive Officer at AlerisLife Inc. and held several executive leadership positions at The RMR Group Inc.

The Fifth Avenue Hotel announced the appointment of Elizabeth Mullins as Managing Director for the hotel and Chief Operating Officer of Flaneur Hospitality. Elizabeth will oversee all hotel operations, as well as the leadership of Flaneur Hospitality. The Fifth Avenue Hotel will open its doors in October 2023 in the heart of Manhattan.

The Cabot Collection announced that Esther Ha and Steven Dougherty had joined the company as Executive Chef and Director of Food and Beverage, respectively. The pair will be based at Cabot Citrus Farms in Central West Florida, with global responsibilities for all destinations in the portfolio. Ha most recently served as Executive Chef at Momofuku Ko in New York City. As Executive Chef at Cabot, Ha will create food and beverage dining concepts and oversee menus for all Cabot properties. Her responsibilities also include building the food sourcing strategy, hiring and training culinary staff, and working with each property to ensure the vision of Cabot is executed to the highest standards. Dougherty most recently served as Corporate General Manager at Room 11 Hospitality Group and Wine Director for Box House Events and MADRE. As the Director of Food and Beverage, Dougherty will execute food and beverage concepts, build menus, and ensure exceptional hospitality, service, and dining experiences for Cabot guests.

European Highlights

KSL Capital Partners appointed bankers at Morgan Stanley to run the auction for its Village Hotels chain of properties in the U.K. Whether or not KSL sells probably depends on whether anyone can come close to its asking price, a challenge in the current climate. KSL bought the chain of 33 hotels in 2014 from De Vere Group for £485 million.

Alan Woinski and Kim Woinski
September 11th, 2023 at 5:58 PM EDT

Companies: Aloft Hotels, Ashford Hospitality Trust, Azul Hospitality Group, Best Western, Best Western Hotels & Resorts, Element, Hilton Hotels & Resorts, Homewood Suites by Hilton, Hotel Equities, hotelAVE, Hyatt Hotels Corporation, KSL Capital Partners, LuxUrban Hotels Inc., Margaritaville Hotels & Resorts, Margaritaville Island Reserve All Inclusive Resorts, Marriott International, Outbound Hotels, Peachtree Group, Pebblebrook Hotel Trust, Soho House and Co Inc., Sonder Holdings Inc., Springboard Hospitality, TownePlace Suites, Trademark Collection, Truist Securities, Tryp, Wyndham Hotels & Resorts

Locations: Arkansas, California, Denver, Idaho, Jackson Hole, Lake Tahoe, Miami, New York City, North Dakota, Ohio, Orlando, Punta Cana, Vermont

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