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North America

Global Deal Announcement Slowed in First 9 Months of 2023

Alan Woinski and Kim Woinski

November 15th, 2023

Skift Take

  • U.S. hotel RevPAR rose by 4.9% for the week, with rates up by 4%. Group RevPAR also increased by 13.3%.
  • Truist adjusted ratings and target prices: lowered ratings for some companies (e.g., Bluegreen Vacations), raised target price for Bluegreen Vacations, and decreased target prices for Hilton Grand Vacation, TNL, and VAC.
  • A significant decline in deals across travel and tourism sectors globally during January-October 2023 compared to the same period in 2022, affecting various regions and deal types.

The DJIA rose 164 points while Nasdaq was up 9, the S&P 500 rose 7 points while the 10 year treasury yield was up .09 to 4.54%. The markets closed well off their highs but lodging stocks were mixed to higher. HLT traded up to another new high, AHT was up 10% while SHCO and VAC were both up 5%. SOND plunged -19%.

STR reported US lodging data for the week ended 11/11. US hotel RevPAR was up 4.9% for the week with rates up 4%. Group RevPAR rose 13.3%.

Truist lowered their rating on Bluegreen Vacations to a Hold following the surge in the stock on the news Hilton Grand Vacation will be acquiring them. They upped their target price on BVH to $75 from $54 while they lowered HGV’s target price to $66 from $73. Truist also lowered TNL’s target price to $59 from $66 and VAC’s to $149 from $187.

A total of 621 deals were announced in the travel and tourism sector globally during January-October 2023, a decline of 31.8% compared to the same period in 2022. An analysis of GlobalData’s Financial Deals Database also revealed that all deal types under coverage witnessed a decline in volume during the same period. The volume of M&A deals declined by 34.2% during January-October 2023 compared to January-October 2022, while the number of private equity deals and venture financing deals announced during January-October 2023 were down by 31.1% and 24% YoY, respectively. All the regions experienced setbacks in deal activity. Deal volume for North America declined by 42.9% during January-October 2023 compared to January-October 2022. Similarly, Europe, Asia-Pacific, Middle East and Africa, and South and Central Americas regions also witnessed a YoY decline in the number of deals by 36.5%, 11.7%, 22.9%, and 40% during January-October 2023, respectively. Deal activity also remained subdued in most of the key global markets. For instance, the U.S., the U.K., Japan, France, South Korea, Australia, Spain and the Netherlands saw a YoY decline of 43.7%, 33.6%, 46.8%, 18.5%, 19.2%, 28.6%, 57.6%, and 27.8% in deals volume, respectively during January-October 2023 compared to January-October 2022.

Plans for a dual-branded hotel moved forward after a St. Louis, Missouri board gave an initial approval to tax abatement for the project. Midas Hospitality is working with Green Street Real Estate Ventures to plan a 170-room boutique Kimpton Hotels & Restaurants and a 129-room Staybridge Suites for the location. The project will cost roughly $126 million and will be built at Market Street and Jefferson Avenue.

The Maybe in Midland-Odessa Facebook page reported that a hotel that has been under construction and was originally announced as a Holiday Inn, then a Delta Hotels by Marriott, will open as a new DoubleTree by Hilton in 2026 in Midland, Texas. The original developer had financial issues and lost the project to the contractor through a sheriff’s sale. The contractor has sold the property to a new developer and the city expects plans to re-permit the project and finish the hotel.

Zachry Hospitality has begun construction of a long-delayed hotel that will be part of a mixed-use development at Hemisfair downtown in San Antonio, Texas. The curved 17-story, 200-room hotel will be named the Monarch San Antonio. Expected to open in early 2026, the hotel will have five food and beverage concepts, including a rooftop restaurant and bar and a basement speakeasy, as well as 10,000 square feet of meeting and event space, a spa, a terrace pool, and a fitness center. It will be part of Hilton’s Curio Collection.

Pioneer Companies celebrated the opening of a new 110-room Hyatt Place Hotel at Quackenbush Square in Albany, New York. The $40 million, seven-story property offers five large meeting rooms totaling 3,200 square feet, a fitness center, guest dining, and outdoor seating areas. The hotel is managed by HEI Hotels & Resorts.

The Office of the Attorney General in Pennsylvania reached a settlement with Omni Hotels Management Corporation regarding the company’s disclosure of “resort fees” and “drip pricing”, practices that leave consumers with larger bills at checkout. Under the settlement, Omni agrees to immediately disclose all fees attached to a stay so consumers can budget responsibly and have the ability to compare prices. Omni owns two hotels in Pennsylvania, the Omni William Penn Hotel in Pittsburgh and the Omni Bedford Springs Resort in Bedford. The settlement is the latest product of the Office of Attorney General’s efforts to hold hoteliers accountable for hidden fees and “drip pricing”. The Office of Attorney General reached a landmark settlement with Marriott in 2021 and just last month announced a similar settlement had been reached with Choice Hotels International, Inc.

Choice Hotels International, Inc. furthers growth in the extended stay segment with three new Everhome Suites under construction, and six more in various stages of development across the Southern California region. The new California properties under construction are the 120-room Everhome Suites Temecula, 113-room Everhome Suites Ontario, and the 114-room Everhome Suites San Bernardino. Paladin Equity Capital established the inaugural Everhome Suites in Corona, California in 2022 and is expanding with these three additional Everhome Suites and six additional projects in various stages of development. The hotels under construction are slated to open in the second half of 2024 and early 2025. For the first nine months of 2023, Choice’s extended stay hotel openings grew by 38% compared to the same period in 2022. Choice’s extended stay domestic pipeline increased 12% YoY to over 47,000 rooms in the third quarter of this year. Choice currently has 60 Everhome Suites properties in the pipeline and over 250 across three other extended stay brands.

Pebblebrook Hotel Trust closed on the sale of the 221-room Hotel Zoe Fisherman’s Wharf in San Francisco, California for $68.5 million to a third party.

Bluegreen Vacations Holding Corporation announced that Bluegreen/Big Cedar Vacations LLC, a joint venture between the company and Bass Pro Shops, has acquired the Stonewater Cover Resort and Club, a wilderness retreat located in Stone County, Missouri. Located on 470 acres within the Mark Twain National Forest, Stonewater Cove features 38 lakeside cottages, a club house with restaurant, pool and hot tub, boat dock, miniature gold course, ziplines, hiking trails and other outdoor amenities.

A 91-key hotel in Hillsboro Beach, Florida has undergone a top-to-bottom, multi-million dollar renovation. Hillsboro Beach Resort, formerly Hillsboro Beach Resort Miles Hotel, was acquired by BH3 Management in 2017. In the years since, BH3 has undertaken an eight-figure overhaul that has ushered in new guest rooms, event spaces, food and beverage outlets and a beach club. BH3 has enlisted Sonder and Garrett Hospitality Group to run the property’s hotel, dining, and event operations. Hillsboro Beach Resort also features a fitness center, resort-style pool deck, private beach access and a business center.

The historic DeLand Hotel, in DeLand, Florida, has a new owner. Ian Carrey and his wife Kacie paid $1.4 million for the three-story property. The sale included another business on the first floor, a speakeasy-themed bar called the DeLand Cocktail Company. The seller of both the hotel and bar was Ross Janke. The DeLand Hotel currently has 10 guest rooms on the first and second floors. It also has a third floor that has been used for storage and Carrey hopes to refurbish to either add more hotel rooms or possibly become extended-stay suites.

The Wayback, a new hotel in Pigeon Forge, Tennessee, opened on November 2 with a ‘70s nostalgia. The hotel features 134 guestrooms, a hotel bar, an Airstream bar and a taco truck by the pool, and a restaurant. The Wayback is a Tribute portfolio hotel.

VAI Resort, the upcoming largest hotel and entertainment destination in Arizona, is gearing up to open its doors in 2024 with the support of Oracle Cloud. With Oracle’s OPERA Cloud hospitality management platform, combined with Oracle NetSuite, VAI will be able to unify its core data and operations on a single, secure infrastructure. VAI will also be using Oracle MICROS Simphony Cloud POS to manage all its restaurants and bars and Oracle Nor1 to deliver more impact upgrade offers for guests and boost incremental revenue. The new $1 billion VAI Resort will consist of 1,100 rooms across four hotel towers with 12 dining establishments, 10 unique bars, and a man-made party island. Additionally, the property will include a two-story nightclub, 360-degree concert stage, five-acre swimming oasis with beaches, luxury retail, and a Spa and Wellness Center.

MCR Hotels, Island Capital Group, and JLL’s Hotels & Hospitality group announced that MCR and Island have closed on a $260 million refinancing of the 1,780-key Sheraton New York Times Square. The four-year, floating-rate loan retires $250 million in outstanding seller-financing that was sourced when MCR Hotels and Island Capital Group acquired the hotel in April 2022. The new financing was provided by funds managed by affiliates of Fortress Investment Group LLC. The 50-story hotel has 61,8000 square feet of meeting space, food and beverage options, a fitness center, business center, onsite parking, and a collection of ground floor retailers.

HHM Hotels added the Courtyard Nassau Downtown/Junkanoo Beach to its managed portfolio. The Bahamian hotel features 201 guestrooms and will undergo a renovation of its public areas and restaurants and bars to reposition the property as the premier hotel in downtown Nassau.

Europe Highlights

A new luxury hotel has opened in Glasgow, Scotland, as part of the £100million Love Loan Development. The 245-room AC Hotel by Marriott Glasgow has seen the restoration of the 120 year old Grade A listed, former city Parish halls into 22 heritage suites. The hotel, operated by RBH Hospitality Management, includes the AC Lounge and AC Fitness center.

One United Properties signed a memorandum of understanding with Ennismore to open Mondrian Hotel in Bucharest, Romania. Starting with February 2024, Riad Abi Haidar will join the company as partner in the hotel division. Riad Abi Haidar has over 20 years of experience in the international hospitality industry.

Alan Woinski and Kim Woinski

November 15th, 2023

Companies: AC Hotels by Marriott, Ashford Hospitality Trust, BH3 Management, Bluegreen Vacations Holding Corp, Choice Hotels International, Curio Collection by Hilton, Delta Hotels & Resorts, DoubleTree by Hilton, Ennismore, Everhome Suites, Fortress Investment Group, HEI Hotels & Resorts, HHM Hospitality, Hilton Grand Vacations, Hilton Hotels & Resorts, Holiday Inn, Hyatt Hotels Corporation, Hyatt Place, IHG Hotels & Resorts, JLL, Kimpton, Marriott International, MCR, Midas Hospitality, Mondrian, Omni Hotels & Resorts, Sheraton Hotels & Resorts, Soho House and Co Inc., Sonder Holdings Inc., Staybridge Suites, Travel + Leisure Co., Tribute Portfolio, Vacasa, Zachry Hospitality

Locations: Arizona, California, Florida, Nassau, New York, Pennsylvania, San Antonio, San Francisco, Scotland, St. Louis, Tennessee, Texas

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