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North America

Choice Hotels Ends Bid to Acquire Wyndham

Alan Woinski and Kim Woinski

March 11th, 2024

interior of a light-filled hotel room

Skift Take

The market liked this conclusion: both companies’ stock prices rose, with Choice Hotels up 6% and Wyndham Hotels 2%, indicating investor relief – or strategic reassessment.

The DJIA was up 47 points but Nasdaq was down 66, the S&P 500 fell 6 points and the 10 year treasury yield was up .02 to 4.10%. Lodging stocks were mixed.

The big news of the day was that the Exchange Offer from Choice Hotels to acquire all the shares of Wyndham Hotels & Resorts had expired this past Friday. Based on CHH’s press release last week, we felt they were saying they would pull the offer if more people did not tender their shares. We felt it was very unlikely CHH was going to get a lot of shares tendered given they were pushing a $90 offer which was not even close to that given the plunge in CHH’s share price. CHH management did an investor call with Truist and on that call, they sounded completely different, saying they were confident they would get the shares and be able to acquire WH. The rise in CHH stock after their press release showed more people felt like we did and were reading between the lines on CHH’s press release. Today, CHH announced the exchange offer expired and they were ending their proposal to acquire WH. They gave some parting shots about how WH’s board would not engage while at the same time not giving the details on how many shares were tendered, just saying it was significant. Once again, we’ll take CHH’s body language and not their comments. If it was significant, they would have extended the offer or sweetened it. Our guess is they got a very small amount of shares from people who could not figure out the offer. CHH said they were increasing their Share Repurchase Authorization by five million shares. CHHstock was going up with or without that repurchase addition because the stock was down because their shareholders did not like the waste of time and money of trying to buy a company that wanted nothing to do with them. What is really surprising is that WH stock also rose on this news, even though clearly CHH took the attention of WH management and the problems WH was encountering with potential franchisees wanting to hold off to see what would happen is now gone which is a positive. CHH traded up 6% while WH rose 2% on the day.

Morgan Stanley cut their rating on Hyatt Hotels to Equal Weight from Overweight. They upped their price target to $156 from $149.

The AC Hotel Sacramento is now open in the heart of downtown Sacramento, California. The 179-room hotel features a restaurant, lounge, and a fitness center.

Related Group and BHG Group won approval to build a 500-key Hilton-branded hotel in Hollywood, FloridaRelated and BHG paid $21.5 million to acquire the 4.4-acre site from Trinity Investments and Credit Suisse. The planned hotel project will also have condo-hotel units for sale with hotel services. The companies plan to finish construction on the hotel in 2027.

IHG Hotels & Resorts announced the opening of a new Holiday Inn Express & Suites hotel in Reedsburg, WisconsinHoliday Inn Express & Suites Reedsburg – Dells Area offers 83 guestrooms, a heated indoor pool, game room, and a hot tub. The property is owned by Reedsburg HEI, LLC and managed by ROI Hospitality.

Regency Inn of Sandestin, Inc. is looking to build a four-story hotel with 100 rooms and 107 parking spaces in Northeast Pensacola, Florida.

A four-story, 80-room hotel redevelopment project in Lexington, Nebraska is being proposed by Lexington HIE, LLC. Construction will take 16-18 months and is planned to start in the fall of 2024, with completion by the first quarter of 2026. The project will cost $13,500,000 and Lexington HEI is seeking $1,650,000 in TIF from the City of Lexington.

Crescent Hotels & Resorts announced the opening of The Total You Medical Spa in the Blossom Hotel Houston, the second Houston location for The Total You. In total, the spa has four massage and treatment rooms, plus a large IV drip lounge. The opening comes as the Blossom Hotel celebrates its two-year anniversary. In spring 2024, the hotel is set to debut the first of three new restaurants.

RAKxa Integrative Wellness announced its debut in the U.S. with RAKxa Wellness Spa at The St. Regis Aspen Resort in Aspen, Colorado. Opening this winter, the spa within the resort will offer enhanced amenities like oxygen therapy, cold plunge pools, hot tubs, steam rooms, a confluence waterfall pool, and Technogym access.

JLL Capital Markets arranged the refinancing for the W Aspen, an 88-key ski resort hotel in ColoradoJLL worked on behalf of the borrower, Northridge Capital, and secured the loan from Riyad Bank. The five-story hotel features a rooftop deck with a heated pool and spa, three food and beverage outlets, meeting/banquet space, a fitness facility, fire pits, structured parking, and a seasonal ski shop.

Avison Young announced the firm has closed 12 hotel transactions over the last 90 days. Four of the sales were Hilton-branded hotels, two were Marriott-branded hotels and IHG and other brands made up the balance. Geographically the hotels were located in the following states: IN, KY, PA, CO, VA, AR, MA, GA, and TN.

Lightstone has launched a new $500 million rescue capital platform, targeting multifamily, industrial, and hospitality assets across the country. The platform will make investments across the capital stack within credit, preferred equity, and equity positions. Investment themes include right-sizing impaired equity or credit positions, deploying new capital to fund future capital expenditures or cap fees, recapitalizing stalled development projects and cash-in refinances. The platform’s target investments will range between $20 million and $100 million with a preference for large portfolios.

Driftwood Hospitality Management assumed management operations and responsibilities for the Hilton Garden Inn San Jose City Mall, a 149-key hotel in Alajuela, Costa Rica. Serving as Hilton Garden Inn’s 1000th property worldwide, the hotel is DHM’s second international property. The hotel features a restaurant, outdoor pool, fitness center, a bar lounge, multiple meeting rooms, and a business center. The property was developed by Corporacion LadyLee.

On the heels of the recently unveiled residential villas, Andaz Costa Rica Resort at Peninsula Papagayo has revealed two new beachside offerings: Casa de Playa, a re-imagined and elevated beach club, and Meso restaurant. Accessible by boat, the new experiences immerse guests in a Costa Rican oasis with a natural canopy of trees and an adjacent mangrove preserve. Casa de Playaoffers a 25-meter pool, plush loungers or cabanas, all serviced by attentive staff. Meso restaurant introduces Meso-terranean cuisine, fusing Meso American and Mediterranean flavors.

Personnel Move

Jumeirah Group appointed a chief brand officer to spearhead the evolution of the brand. Michael Grieve will lead Jumeirah’s “2030 Mission” to reach 50 hotels globally, around double what it currently has. Most recently, Grieve was at Gucci as VP of brand and client across Europe, Middle East, and Africa. Upcoming openings for Jumeirah include Marsa Al Arab opening later this year in Dubai. Another resort is set to open in Saudi Arabia next year and a hotel in Geneva is slated to open next year as well.

Europe Highlights

Minor Hotels is introducing Avani Hotels & Resorts to the Netherlands in Q2 this year. The rebranded 163-key Avani Museum Quarter Amsterdam will feature a grab-and-go dining concept and the AvaniFit gym.

Limestone Capital has acquired a five-star resort hotel on Sardinia’s Costa Smeralda. Set to open in May under the Aethos brand, the hotel will comprise 63 rooms and suites, freshwater pools, a gym, and a restaurant. The hotel will also offer holistic treatments and curated oceanic adventures.

The Chateau L’Hospitalet Wine Resort Beach & Spa in Narbonne, France has joined the Small Luxury Hotels of the World collection. The five-star hotel offers pools, tennis courts, a putting green, walking routes, multiple restaurants, and The Spa Soleilla.

Alan Woinski and Kim Woinski

March 11th, 2024

Companies: Wyndham Hotels & Resorts, AC Hotels by Marriott, Avani Hotels & Resorts, Choice Hotels International, Crescent Hotels & Resorts, Driftwood Capital, Hilton, Hilton Hotels & Resorts, Holiday Inn Express, Hyatt Hotels Corporation, IHG Hotels & Resorts, Jumeirah Hotels and Resorts, Lightstone, Limestone Capital, Minor Hotels, Related Companies, ROI Hospitality, Small Luxury Hotels of the World, St. Regis, W Hotels

Locations: Amsterdam, Aspen, California, Costa Rica, Florida, France, Greece, Houston, Miami, Nebraska, Wisconsin

Photo credit: A guest room at the Wyndham Grand Krakow hotel, which opened in 2023  Wyndham Hotels & Resorts

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