The DJIA was down 252 points, Nasdaq was down 226, the S&P 500 was down 50 points and the 10-year treasury yield was down .11 to 4.85%. Lodging stocks were lower. AHT and VAC traded down to new lows.
Choice Hotels, after the close yesterday, issued a press release asking (demanding?) Wyndham Hotels to come back to the table and engage them in discussions regarding a transaction. They gave their reasons why WH should jump at the chance for a merger. WH then issued their 3Q results, reporting in-line with another $105 million worth of stock repurchased. In the press release WH reiterated they said no to CHH and are not interested in a merger with them. Ahead of their conference call this morning, WH issued a release reiterating their reasons they said no to CHH. Then on the call WH’s chairman dropped the bombshell that they came close to buying CHH 20 years ago or so. CHH wanted an all-cash offer, WH was going to go through with it but then the debt markets turned against them so they disengaged. Chairman Steve Holmes then said that the only reason he can think of that CHH keeps coming after them after they keep saying no is because they are not growing and CHH has some serious issues within their organization and they think WH is the elixir for their problems.
At the close of Q3 2023, the total U.S. construction pipeline stands at 5,704 projects/672,676 rooms, up 7% YOY by projects and rooms, according to the most recent Construction pipeline Trend Report for the United States by Lodging Econometrics. At the close of the third quarter, there are 1,063 projects/140,332 rooms under construction, up 8% by projects and 4% by rooms YOY. Projects scheduled to start construction in the next 12 months stand at 2,234 projects/257,729 rooms. Projects and rooms in the early planning stage stand at 2,407 projects/274,616 rooms. Analysts at LE report that the upper midscale chain scale has the largest project count of all chain scales in the total U.S. construction pipeline, with 2,149 projects/209,895 rooms. Following is the upscale chain scale with 1,376 projects/170,943 rooms at the close of the quarter. At the end of 2023’s third quarter, 2,175 projects/223,518 rooms in the U.S. construction pipeline are extended stay projects. Middle tier extended stay brands make up the majority of projects in the extended stay segment at Q3, accounting for 63% of projects in the total extended stay pipeline and 24% of projects in the total U.S. construction pipeline. Renovation and conversion activity remains steady at the end of Q3, with conversion projects and rooms hitting the highest counts ever recorded by LE and ending the quarter at 1,100 projects/146,757 rooms. Combined, the renovation and conversion active pipeline accounts for 1,912 projects/285,568 rooms. LE analysts expects this trend to continue into 2024 and 2025. Through the third quarter, 345 new hotels with 41,115 rooms opened in the U.S. with another 182 hotels/24,790 rooms anticipated to open by the end of the year. LE analysts forecast a total of 527 new hotels with 65,905 rooms to open in 2023, representing a 1.2% increase in new hotel supply. LE analysts expect new hotel openings to increase in 2024 and 2025, representing a 1.4% and 1.5% supply increase, respectively.
Westin Hotels & Resorts unveiled its latest offering in Washington, DC, Westin Washington, DC Downtown. After a nearly $80 million investment by Sunstone Hotel Investors, the 807-room hotel offers onsite dining, a grab-and-go Wellness Market, fitness studio, and modern meeting spaces and workstations.
Opry Entertainment Group, a subsidiary of Ryman Hospitality Properties Inc., will begin work this week on a $40 million renovation of Block 21, in Austin, Texas, the Second Street mixed-use development home to Austin’s ACL Live at the Moody Theater and the W Austin hotel. The renovation will include the construction of a new 2,060 square foot terrace enclosure over this existing PNC Plaza, which will serve as a private event space designed to serve both ACL Live and the W Austin and is planned to be completed by summer 2024. Other improvements include a facelift to the W Austin entrance and other public spaces on site including its coffee shop, restaurant and bars. Renovations of the hotel’s more than 200 guestrooms are planned to be completed in fall 2024. Both the W Austin and ACL Live will remain open during the upgrades.
Four Seasons is expanding its Private Retreats collection of luxury villa and residence rentals offering the very best of living, hosting, and vacationing for every lifestyle. Four Seasons Private Retreats expects to increase their offerings from 700 homes in 30 destinations to more than 1,000 over the next three years. Four Seasons Private Retreats luxury villa and residence rentals set to debut in new destinations include: Four Seasons Resort and Residences Cabo San Lucas at Cabo Del Sol, Mexico; Four Seasons Resort and Residences aye Chapel, Belize; Four Seasons Resort and Residences Dominican Republic at Tropicalia; Four Seasons Hotel and Residences New Cairo Capital at Madinaty, Egypt; and Four Seasons Hotel and Residences Cartagena, Colombia.
DOMO Development announced its plans for the former Pepsi building in Fort Wayne, Indiana. The company plans on creating the Riverfront Planned Urban District, which would include a 5,000 seat multi-use arena and event venue; a 5,000 seat outdoor soccer stadium with a connected boutique hotel, accessible riverfront spaces, multi-generational residential village, commercial and retail space, and youth and professional sports facilities, including a natatorium with an Olympic-size pool.
The first resort concept for Tommy Bahama will debut on November 1 in Indian Wells, California, as Tommy Bahama Miramonte Resort & Spa. Following an extensive, $20 million renovation and redesign, the transformed resort will include 215 guestrooms and villa suites, 35,000 square feet of flexible meeting and event space, three saltwater pools with cabanas, a new signature restaurant and bar, Rosa Boutique and Spa Rosa. CoralTree Hospitality will manage the resort.
Terra and Sympatico Real Estate unveiled plans for Mr. C Hotel & Residences in West Palm Beach, Florida. The 25-story condominium hotel will include 110 rooms alongside 146 branded residences. Hotel amenities include a signature restaurant and lounge, ballroom, library and exceptional rooftop pool deck with a lounge and Jacuzzi area with fully serviced cabanas. Resident amenities include a fitness center and spa, co-working lounge center, dog run, Bocce court and a resort-style pool deck with cabanas, a children’s playground and a barbecue area. Construction of the project is slated to begin in early 2024 and wrap up in 2026.
The former Wyndham Hotel property on Post Road in Warwick, Rhode Island recently sold for $5.9 million. The five-story hotel property, which most recent operated as The Cru Hotel was bought by 1850 Post Road Owner LLC. According to Lila Delman Compass, the real estate firm that represented the seller Shiva LLC, the new owners plan to build 150 studio apartments there.
In Paducah, Kentucky, the Downtown Hotel Project, which is part of the City Block Project, is indefinitely delayed. Weyland Ventures, the developer in charge of the project, cited unforeseen foundational design issues, a loss in the initial financial commitment, and difficulties securing subcontractors as the main reasons for stopping construction.
Bain Capital Special Situations and Smith Hill Capital announced the formation of a joint venture to originate debt and preferred equity to serve the financing needs of companies and assets in the hospitality sector. The platform launches with the objective of deploying $1 billion of gross capital over the next several years. The joint venture will initially focus on new loan originations and debt refinancing exclusively in the hospitality space within primary and secondary markets throughout the U.S. In select instances, Bain Capital and Smith Hill Capital will seek to acquire debt and provide rescue capital to high-quality borrowers.
Cronheim Hotel Capital secured a $120,000,000 refinancing on behalf of LAM Generation for the 341-key Renaissance Hotel located at 112 W 25th Street, New York, NY.
Park Hotels & Resorts announced the trustee under the $725 million non-recourse CMBS loan, by and through its special servicer, filed a lawsuit against the borrower entities related to the cessation of payments on the loan. The trustee requested the appointment of a receiver to control the hotels securing the loan, the 1,921 room Hilton San Francisco Union Square and 1,024 room Parc 55 San Francisco. If appointed by the court the receivers will have the ability to market the hotels for sale and have until September 1, 2024 to consummate a transaction.
HREC Investment Advisors arranged the sale of the 70-room Comfort Suites Huntsville, Research Park Area in Huntsville, Alabama. The property was acquired by MH Hospitality. HREC Investment Advisors exclusively represented Saturn Hospitality, LLC in this transaction.
Personnel Moves
Appellation welcomed Jennifer Clay as Vice President of Hotel Operations. In the new role for the brand, Clay oversees the guest experience design and execution across Appellation properties to delight guests, create long-term loyalty, expand content creation and solidify premier market positioning. Clay previously held multiple roles at Pineapple Hospitality Company, most recently as the Vice President of Brand Assurance.
Mandarin Oriental Hotel Group appointed Marcel Thoma as General Manager of Mandarin Oriental, New York. Mr. Thoma will also act as Area Vice President overseeing Mandarin Oriental, Boston, Mandarin Oriental, Santiago, Mandarin Oriental Residences, Beverly Hills, Mandarin Oriental Residences, Fifth Avenue, and The Residences at Mandarin Oriental, New York operations. Mr. Thoma was most recently the General Manager of Mandarin Oriental, Marrakech.
Generator and Freehand Hotels appointed Dirk Lobowsky as Senior Vice President of Global Sales. Tasked with developing and executing winning sales strategies across Europe and the U.S., Lobowsky will join the senior team in expanding the business and will lead the sales division to competitively position Generator and Freehand Hotels across all markets. Prior to his role managing commercial projects for Generator and Freehand Hotels, Lobowsky spent over a decade leading and implementing global sales strategies as Vie President at Flemings Hotels and Vice President of Sales at Penta Hotels.
Access Point Financial announced the appointment of James Reivitis as Managing Director, Head of Business Development. Reivitis will lead the Business Development Team. He joins Access Point Financial from 6M Company.
Hotel Investor Apps appointed Gregg Suffredini as Regional VP of Sales – East. Most recently, Suffredini held positions at Data Plus as President and VP, Business Development.
Europe Highlights
IHG Hotels & Resorts announced a slate of voco hotels properties across its European markets as the brand’s growth continues. With recent signings and openings in France, Spain The UK&I, Austria, Portugal, and Belgium, these additions take Europe’s voco hotels total number of opened and signed properties to 37. Recent signings include the 120-room voco Belfast, UK, scheduled to open in early 2024 in partnership with Cliste Hospitality. The 87-key voco Letchworth Hall, UK is slated to open in 2024. voco Zeal Exeter Science Park, UK, IHG’s first lifecycle net zero carbon hotel, is scheduled to open in early 2025 with 142 guestrooms; and the 166-key voco Granada, Spain is opening late 2024 adjacent to the Convention Centre of Granada. voco hotels has 55 properties open around the world with a further 51 in the pipeline.
