The DJIA ended Friday up 62 points while Nasdaq was down 45, the S&P 500was up 2 and the 10 year treasury yield was down .07 to 4.26%. On a Friday dominated by earnings report from the close Thursday and Friday morning, the new highs list from lodging stocks hit a new 2024 high. New 52 week highs were set by H, MAR, HLT, RLJ, IHG, RHP and HST. SOND was up 16% and AINC rose 7% on the day.
Hyatt had preannounced but when they actually released their report and gave somewhat mixed guidance, everything else they said resonated well with investors with the stock rising 11% on Friday. What surprised the Street in a positive manner was the news they were selling 80% of their Unlimited Vacation Club business and they sold the Hyatt Regency Aruba for $240 million on February 9th but will retain the management contract. H also bought back 890,000 shares in 4Q for $95 million. So far in 2024, they spent $30 million on share buybacks.
On the REIT side, Apple Hospitality had a modest beat, gave strong 2024 guidance above consensus but the stock barely budged. The only thing we can see holding them back is the consistent ATM financing with 12.8 million shares issued in 4Q under its ATM program at a $17.05 share average. There is nothing wrong with raising $216 million at its highs but sometimes the Street gets concerned that there is a ceiling created on the stock price. Ryman Hospitality Properties’ 4Q report was in line with their pre-announcement at their Investor Day. DiamondRock Hospitality had pre-announced 4Q RevPAR prior to ALIS. While they met expectations in 4Q, they gave a very wide range for 2024 guidance. Sunstone Hotel Investors had a 4Q EBITDA beat and an in-line 2024 guide. They bought back just over 2 million shares in 4Q and has $454.7 million remaining on their authorization.
Playa Hotels & Resorts had a big 4Q beat but their 2024 guidance was only modestly above consensus. They bought back 4.5 million shares in 4Q for $33.2 million and another $14.6 million worth of stock in January. PLYA has $181.8 million remaining on their authorization.
Wyndham Hotels & Resorts, for like the umpteenth time, has made it clear they are sick of Choice Hotels, with a letter to shareholders from Chairman Stephen Holmes accusing Pat Pacious of lying. He referenced Pacious’ claims on CHH’s earnings call that WH’s board has refused to engage CHH’s proposed offer. Holmes said nothing is further from the truth as they have engaged but will not roll over. Holmes said their board and advisors have connected with CHH over 25 times since April 2023 and despite constantly telling CHH what they need to address to make its proposal attractive for WH and its shareholders, CHH had not addressed any of the issues. Holmes said that instead, CHH has adopted this misleading tactic to divert attention away from its own unwillingness to address the realities.
Canada’s hotel industry showed lower occupancy but continued growth in ADR, according to CoStar’s January 2024 data. January 2024 (percentage change from 2023): Occupancy: 49.6% (-1.7%) ADR: CAD175.38 (+4.3%) RevPAR: CAD87.00 (+2.6%). Among the provinces and territories, Manitoba recorded the highest January 2024 occupancy level (58.8%), 8.1% below 2023. Among the major markets, Toronto saw the highest occupancy (61.4%), up 2.2% over January 2023. The lowest occupancy among provinces was reported in Prince Edward Island (28.6%), down 20.5% against 2023. At the market level, the lowest occupancy was reported in Edmonton (+2.9% to 44.3%). Visitors to Toronto faced an ADR of $203.70, or $0.43 more than the $203.27 that Vancouver hotels charged guests on average during the month. In contrast, Edmonton’s ADR in January was $136.94. Vancouver’s average hotel room rate in January increased more than 5.55% year over year from $192,61 in January 2023, while Toronto’s rose more than 4.75% from $194.46 in January 2023, according to CoStar’s data. The average daily room rate for hotels across the country was $175.38 in January, up about 4.3% year over year.
Investors are waking up to the renewed appeal and strong fundamentals of Canadian hotels, according to CBRE. Morguard Corp. just closed on the sale of a portfolio of 14 hotel properties in Ontario and Halifax to InnVest Hotels and Manga Hotel Group for $410 million. CBRE brokered the transaction. InnVestacquired 10 of the hotels: Marriott Toronto Airport, Courtyard Toronto Airport, Residence Inn Toronto Airport, Hotel Carlingview, Courtyard Vaughan, Courtyard Markham, Residence Inn Markham, TownePlace Suites Sudbury, Cambridge Suites Halifax and The Prince George Halifax. Privately held Manga Hotel Group acquired four of the hotels in the Morguard sale: Hilton Garden Inn Toronto Airport West, Courtyard by Marriott Mississauga, Cambridge Suites Mississauga, and Holiday Inn Express Ottawa West. The liquidity provided by this transaction will enable Morguard to pursue its core business: owning and managing a diversified real estate portfolio of office, industrial, retail, and multi-suite residential properties. CBRE Debt and Structured Finance helped the buyers with funding the transaction.
Miami International Airport is getting a new onsite hotel, the new Westin hotel is set to open in 2027. The hotel will be connected through a pedestrian bridge to MIA’s North Terminal, Concourse D, the hub for American Airlines. MIA’s West hotel will have 450 rooms and is expected to offer a rooftop restaurant; an expansive outdoor pool deck with pools, hot tubs, and event spaces; over 30,000 square feet of banquet and meeting space; day suites; fitness studios; and up to 200 parking spaces.
IHG Hotels & Resorts announced the opening of a new-build Candlewood Suites hotel in suburban Cincinnati. Owned by CW Erlanger, LLC and managed by HW Management, the Candlewood Suites Erlanger – South Cincinnatifeatures 108 suites, an outdoor Gazebo Grill and a Candlewood Gym fitness center.
Stash Hotels and Block 22 announced the long-anticipated completion of the renovation of Hotel 43 is due by the end of March. The downtown Boise, Idahohotel received a complete refresh of all 112 guestrooms; an expanded lobby; as well as the Parallel Room, a closed-off space for small meetings. The $6 million in updates also included a new lounge and library, and upgrades to the Latitude Room including a new bar and restroom. The hotel is also home to Chandlers Steakhouse.
Red Roof announced the opening of the 76-room extended-stay HomeTowne Studios Yuba City and the 43-room Red Roof Inn Yuba City in Yuba City, California. Owned by Greenleaf Hospitality, LLC, the dual-branded property offers a fitness center, an outdoor hot tub and a seasonal pool. As part of the conversion, both properties received new bedding, refreshed bathrooms and a new pet-relief area.
Great Wolf Resorts arranged a roughly $1 billion partial refinancing of 14 hospitality and entertainment properties known for their indoor water parks. A group of banks led by JPMorgan Chase agreed to provide a floating-rate, interest-only loan backed by eight resort properties located across seven states. The CMBS offering is preliminary, and the filing didn’t include a total amount for the two-year loan, financing that is to have three one-year extension options. The debt will be used to repay a portion of a $1.7 billion CMBS loan on a portfolio of 14 properties that JPMorgan and other banks originated in 2019. That loan was recently extended to mature in December this year. Six of the eight Great Wolfproperties to be refinanced are expected to include resorts in Williamsburg, Virginia; Fitchburg, Massachusetts; Mason and Sandusky, Ohio; Wisconsin Dells, Wisconsin; and Minneapolis, Minnesota.
The owner of the former Trump International Hotel in Washington is recapitalizing the property with $75 million from investors led by Mavik Capital Management. The new cash is intended to reduce leverage levels on the property, which was rebranded as a Waldorf Astoria in 2022. CGI Merchant Group purchased the hotel in 2022 from the Trump Organization.
Personnel Moves
Noble House Hotels & Resorts announced the promotion of Darrell Stark to Vice President of Revenue Strategy and Sales. He served as Vice President of Revenue Strategy and Distribution for Noble House Hotels & Resorts prior to his promotion.
WaterWalk appointed Rebecca Billups to national director of sales for its Stay division. In this role, Billups will be responsible for proactively soliciting qualified national accounts to create partnerships across the WaterWalk portfolio. In addition, she will represent the brand at key industry events, continuing to share the unique positioning WaterWalk holds within the hospitality industry.
International Highlights
IHG Hotels & Resorts announced the singing of its first Kimpton Hotels & Restaurants property in Italy. The Kimpton property in Sicily will open in the second half of 2025 and represents a management agreement with partner Societa Turistica Alberghiera Taorminese. Nestled in the hill-top town of Taormina, the 59-room boutique hotel is expected to feature destination dining, a breakfast room, bar terrace, an outdoor Mediterranean garden, pool, and a tennis court.
Standard International is setting its sights on a bold European expansion with upcoming properties in Brussels, Lisbon, and Dublin. Anticipated to open in the first half of 2025, The Standard, Brussels will boast 200 keys, 20 of which will be The Standard’s first extended-stay offering; a lobby restaurant and bar; a rooftop garden and brasserie. Embarking on its Iberian adventure in late 2025, The Standard, Lisbon will offer approximately 172 rooms alongside new branded residences nestled in the historic town of Alfama, Lisbon. The Standard, Lisbon will include an outdoor pool deck and terrace, a rooftop bar and an onsite spa. Looking ahead to 2027, The Standard, Dublin will debut as a 200-room property in the Dublin Arch development.
Slatto and Petter Stordalen’s Strawberry are unveiling a new hotel chain aimed at filling a gap in the Nordic hotel market, with a focus on strategic locations, quality and high sustainability ambitions. Sweden is the initial launch market for the new hotel chain, with ambitions to expand across the Nordic region in the coming years. The first hotel is expected to open in Q2 2025 in Falkenberg, in southern Sweden, featuring 151 guestrooms.
Club Med plans to open nine new resorts, refurbish 10 others and reopen two more. The announcement by the brand, run by Fosun International, follows the opening in December 2023 of the Kiroro Grand Resort, Japan, and a new Exclusive Collection Space in La Rosiere, France. The two resorts set to reopen are Vittel Ermitage in July, followed by Serre Chevalier in December, both in France. The new openings are Forlong, China in December, followed by two in 2025 – Borneo with an Exclusive Collection Space, and Gramado, Brazil. Four other new resorts due to open will also have an Exclusive Collection Space but no date has been set for their launch: Quidah, Benin; San Sicario, Italy; Tinley Manor, South Africa; and Essaoura, Morocco. A further two resorts are also planned – North Sulawesi, Indonesia and Musandam, Oman, but no date has been set for these openings. Three resorts will undergo renovations in April: Marrakech La Palmeraie, Morocco; Palmiye, Turkey; and Djerba, Tunisia. Gregolimano, Greece will be refurbished in July. Other resorts earmarked for refurbishments in 2024 are Rio Das Pedras, Brazil and Cancun, Mexico. Three will see renovations in 2025: Punta Cana, Dominican Republic; Les Boucaniers, Martinique; and Phuket, Thailand. Cap Skirring, Senegal, is also set for renovation with the date yet to be confirmed. Renovations will include upgrades such as extensions to family facilities, pools, refurbishments of common areas, and modernizations of guestrooms.
A theme park hotel as opened new rooms featuring a cookie-shaped bed and even a slide. One of the themed rooms at Chessington World of Adventures Resort, in Chessington, U.K., is dedicated to Oreo cookies and the second is based on Capri-Sun drinks. The Oreo room is decorated with hundreds of cookies and guests can sandwich themselves between the sheets in a custom Oreo bed. They can also follow the milk trail to a separate bunk bed – appearing as if built from Oreos piled high. The room comes with plenty of cookies for guests to enjoy. The Capri-Sun room features splashes of the juice drink across a jungle-inspired bed and bathroom. It also has neon light features, a mini-bar filled with Capri-Sun and its very own slide.
The Blue Diamond company will take over three more tourist facilities in eastern Cuba, under the name of Mystique Saratoga. The Saratoga, Cabelleriza and Esmeralda hotels, in the city of Holguin, hope to create a high-standard boutique complex. Also in Holguin province, a part of the Club Amigo Atlantico Guardalavaca hotel will be added to the Mystic brand.
