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North America

IHG’s Group Quarterly RevPAR Up 12.8% Over 2019

Alan Woinski and Kim Woinski
October 22nd, 2023 at 4:44 PM EDT

Skift Take

  • IHG reported strong earnings, including a 10.5% increase in Group RevPAR, but disappointed shareholders by deferring capital returns.
  • The US group business is rebounding well, with top markets nearly fully recovered to 2019 levels. Prominent cities like Austin, Nashville, and Denver exceeded 2019 figures.
  • Various hotel developments and acquisitions are ongoing in different locations, reflecting the industry’s resilience and growth prospects. Notably, TMGOC Ventures secured approval to introduce the first Ritz-Carlton in Savannah.

The DJIA ended Friday down 287 points while the Nasdaq was down 202, the S&P 500 was down 54 points, and the 10-year treasury yield was down .06 to 4.92%. Lodging stocks were lower. SOHO and VCSA traded down to new lows, with VCSA down another -7%. SLNA fell -6%.

IHG kicked off the hotel earnings season, and while the results were good, with IHG focusing on Group RevPAR being up 10.5% versus 2022 and 12.8% versus 2019, along with 50 hotels and nearly 8,000 rooms opening in the quarter, they didn’t give the shareholders what they wanted with more capital returns. IHG said they would be reviewing additional capital returns in 2024, and by the end of 2023, they should have returned up to $1 billion to shareholders with buybacks and dividend payments. Still, analysts said they were disappointed they didn’t have anything ready with this report.

Knowland and Amadeus presented the metrics from their Hospitality Group and Business Performance Index. The third quarter of this year showed the Top 25 U.S. markets have recovered 99.1% for group business compared to the same time in 2019. Q3 data shows that 12 of the top markets have recovered 100% or more of group revenue. Additional key insights from the 3Q 2023 Index include group business maintaining its upward trajectory, with the Q3 Group Performance Index now at 103%, driven by a 12.1% increase in ADR. Meeting and event business continues to provide stability. Events achieved 89.1% of 2019. Key markets doing this well include Austin, TX; Nashville, TN; and Denver, CO, which all achieved 145% over 2019 for Q3. Optimism is improving for corporate travel. The top three markets leading this include Miami 119%, San Diego 112%, and Las Vegas 108%. Corporate meetings dominate, as demonstrated by the fact that 70% of meetings in Q3 averaged <= 200 attendees. 

TMGOC Ventures received approval from the Savannah Historic District Board of Review to bring the first Ritz-Carlton to the city. Construction is scheduled to begin in the second quarter of 2024, with a proposed opening date within the first quarter of 2026. The 104-room Ritz-Carlton will occupy the historic Savannah Skyscraper at 2 E. Bryan Street, and the 20 residences will be at 14 E Bryan Street. The hotel and residences will feature a signature restaurant, a lobby lounge, a members-only Club, a rooftop bar and pool, a spa and wellness facility, and more than 5,000 square feet of meeting space. The luxury hotel development will be owned by TMGOC and operated by The Ritz-Carlton, a Marriott International brand.

MCR completed the sale of the 146-room Residence Inn by Marriott Seattle South/Renton, in Renton, Washington, for $55.5 million. Apple Hospitality REIT, Inc. acquired the property.

A joint venture of NewcrestImage, Dabu Group, and Preeminent Hotels acquired ownership and operation of two Marriott-branded hotels in The Woodlands, Texas, the 90-room Courtyard and the 90-suite Residence Inn. Both properties will be fully renovated starting next year and will remain open during the renovations. Current amenities at the Courtyard include an onsite restaurant, Starbucks coffee shop, business center, fitness center, and indoor pool. The Residence Inn features an indoor pool, gym, tennis courts, and BBQ grills. 

Jackson-Shaw Co. and Holualoa Cos. are planning to build a unique dual-branded hotel as part of the overall USAA campus and Norterra master-planned community in north Phoenix, Arizona. The building will feature a 179-key AC by Marriott and a 95-key Element by Westin. Project documents show that the four-story building will have a raised plaza and shared amenity spaces, including 8,000 square feet of meeting space, a fitness center, a resort-style courtyard with a saline pool, a heated spa, and an event lawn. 

Windsor Aughtry Company announced the commencement of construction of a 170-room Tapestry by Hilton hotel in Rogers, Arkansas. The hotel will have six stories, with a sixth floor being a dedicated rooftop experience featuring an open terrace bar, Oak Steakhouse by The Indigo Road Hospitality Group, and 2,400 square feet of banquet space. Additional amenities include 1,500 square feet of flexible meeting space, outdoor patio, oversized fitness facility, and indoor bike storage. The Tapestry by Hilton hotel will be managed by Hospitality America

Wintergreen Hospitality is planning to build a Home2 Suites Hilton hotel in Smithfield, North Carolina. The 5-story hotel will sit next to a Hampton Inn that Wintergreen also developed. There is currently no completion date set for the project. 

Pacific Hotel Austin LLC announced the opening of Cambria Hotel Austin Downtown, in Austin, Texas. Pacific Hotel Austin developed and owns the property, which is managed by Azul Hospitality Group. The 16-story hotel offers 212 guestrooms, seven conference rooms totaling more than 8,300 square feet of space, multiple food and beverage venues, a marketplace, a resort-style pool with an expansive pool deck, and a fitness center. 

Nearly four years after breaking ground, Koucar Management announced the opening of the Cambria Hotel Detroit Downtown. The new 154-room, upscale hotel offers numerous public spaces, multiple eateries, a grand ballroom, Five Iron Golf, and a mini bowling alley.

hihotels by Hospitality International announced the activation of four properties: Scottish Inns in Austin, Forest Hill and Hankamer, Texas and a Passport Inn in Paradise, Pennsylvania. The Scottish Inns & Suites in Austin is a former Rodeway Inn with 35 guestrooms. The Scottish Inns hotel in Forest Hill is a new construction, 46-room property. The 40-room Scottish Inns hotel in Hankamer is a former Palace Inn, and formerly a Rodeway Inn, the 25-room Passport Inn in Paradise is hihotels’ 20th property in Pennsylvania. 

Atlas Restaurant Group announced a new multi-million dollar renovation for its Annapolis Waterfront Hotel and will add two dining concepts by 2025. The company agreed to lease about 37,000 square feet of indoor and outdoor area to recreate the image of the dining and banquet spaces, along with overseeing the hotel’s food and beverage operations. The current restaurant location will be extended and divided into two distinct concepts. 

The Murrieta Hot Springs in Murrieta, California, will reopen to the public in February 2024. The newly re-imagined resort will offer more than 50 geothermal pools, water features, cold plunges, a restorative spa, a fitness center and multiple dining options.

Hacienda Xcanatun, Angsana Heritage Collection, in Yucatan, Mexico, announced the opening of its new Angsana Spa. The newly built spa offers a range of Asian and Mexican therapies, private bathrooms, showers and steam facilities. With the launch of the new spa, the property also created a space for yoga and meditation located atop a pond. 

In Mount Pleasant, South Carolina, a local developer won a lawsuit against the town and is looking forward to building the Shem Creek Boutique HotelCKC Properties wants to start construction as soon as possible, but even after a lawsuit win, their right to build is still on hold because the town is appealing. The court ruled twice that the town’s zoning commission wrongly denied approval to the company as the town slowed down its progress and created new rules and regulations to stop the Shem Creek Boutique Hotel. 

The historic White House Hotel in Biloxi, Mississippi, is expanding. The hotel will be breaking ground at the end of November and beginning of December. Lodging & Leisure Investments says the three-story addition will give them the opportunity to host more gusts and hold larger events and weddings.

Cronheim Hotel Capital secured a $120,000,000 refinancing on behalf of LAM Generation for the 341-key Renaissance Hotel in New York City

Preferred Hotels and Resorts announced the addition of 15 new member properties, including six brand-new openings. These six include: The Global Ambassador in Phoenix, Arizona; the Artyzen Singapore in Singapore; Le Logis in Cognac, France; Hotel Manapany in St. Barthelemy; Mayfair House Hotel & Garden in Miami, Florida; and Hotel Bellevue located in Mali Losinj, Croatia.

Personnel Moves

InterContinental Hotels Group PLC announced the appointment of Sir Ron Kalifa as Non-Executive Director, effective January 1, 2024. Ron is currently Chair of Network International and, prior to this, Deputy Chair of Worldpay. Ron will serve on the Audi Committee and Remuneration Committee upon appointment.

Gulph Creek Hotels announced James Wiley has joined the company as the new Area Sales Manager. In addition to supporting sales and marketing efforts for Gulf Cree’s Philadelphia area portfolio, James will lead the opening sales teams in launching the Prussia Hotels and Residence Inn in King of Prussia and AC Hotel Newtown Square in 2024.

Alan Woinski and Kim Woinski
October 22nd, 2023 at 4:44 PM EDT

Companies: AC Hotels by Marriott, Amadeus, Apple Hospitality REIT, Atlas Hospitality Group, Azul Hospitality Group, Cambria Hotels, Choice Hotels International, Cronheim Hotel Capital, Element, Hilton Hotels & Resorts, Home2 Suites by Hilton, Hospitality America, Inc., IHG Hotels & Resorts, Marriott International, MCR, NewcrestImage, Preferred Hotels & Resorts, Renaissance Hotels, Residence Inn by Marriott, Ritz-Carlton, Selina, Soho House and Co Inc., Tapestry Collection by Hilton, TMGOC Ventures LLC, Vacasa, Wintergreen Hospitality

Locations: Arkansas, Austin, California, Denver, Detroit, Las Vegas, Maryland, Mexico, Miami, Mississippi, Nashville, New York City, North Carolina, Phoenix, San Diego, Savannah, Seattle, South Carolina, Texas

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