Timeshare and Casino Earnings Spook Investors

If the reaction to Travel + Leisure Co’s earnings in the timeshare space and Red Rock Resorts in the casino space are any indication of what this season holds, investors are not going to be happy. TNL reported a modest beat and a modest full-year raise, but the guidance for 3Q was said to be light, and the stock went down. Red Rock Resorts reported a solid 2Q24, announced an expansion of their new Locals Las Vegas resort, and saw big-time stock decrease. The only thing we can say is if a company is preparing an earnings press release preparing guidance, please remember that what you may think is insignificant can be the mountain out of a molehill in the current situation on Wall Street. Despite the indexes looking so good, the underlying sectors are not doing that well, and investors are still having a shoot-and-ask-questions-later mentality. As for TNL’s activity, they bought back 1.6 million shares for $70 million, higher than last quarter, about 2% of the shares outstanding. There were about 1 million more shares bought back in 2Q, even though the average share price for the repurchases was nearly $5 higher than in 1Q. The one negative that everyone seems to be focusing on is the increase in loan loss provisions with timeshare financing. In the sub-700 credit score, customers have more delinquencies. For now, it is being offset with positive parts of the business elsewhere. But in this market, it doesn’t take much for investors to get nervous.

According to June 2024 data from CoStar, the U.S. hotel industry reported improved performance results from the previous month. June 2024 (percentage change from June 2023): Occupancy: 69.6% (flat) ADR: $161.30 (+1.5%) and RevPAR: $112.33 (+1.5%). Among the Top 25 Markets, New York City experienced the highest levels in each of the three key performance metrics: Occupancy (+2.5% to 87.8%), ADR (+4.4% to $317.91), and RevPAR (+7.0% to $279.08). Markets with the lowest occupancy for the month included New Orleans (56.9%) and Phoenix (63.4%). The Top 25 Markets showed higher occupancy and ADR than all other markets.   

STR reported U.S. lodging data for the week ended 7/20. U.S. hotel RevPAR was up 3.4% year over year, with ADR up 2.4%. Group RevPAR was up 13.6%.  

The business travel industry has proven itself resilient as it leaves the global pandemic behind and moves into a new era of post-pandemic stabilization. The forecast for 2024 predicts global business travel spending will reach $1.48 trillion USD by the end of the year, an increase on 2019 spending, which was a previous record at $1.43 trillion. Additionally, by 2028, it is projected to exceed $2.0 trillion, highlighting a robust path ahead for the business travel sector in terms of spending. These are the top-level findings from the latest 2024 GBTA Business Travel Index Outlook - Annual Global Report and Forecast published by the Global Business Travel Association.  

Crystal Creek Hospitality announced the completion of a property-wide redesign to the SpringHill Suites Jackson Hole in Jackson Hole, Wyoming. The renovations encompassed significant enhancements across the property, including a refresh to all 121 suites, a new arrival experience with the complete redesign of the lobby and added business center, updated touches to the fitness center, and upgrades to all 1,500 square feet of meeting and event spaces.   

Skyline Investments signed an agreement for the sale of four Courtyard by Marriott hotels: the 146-room Courtyard Dayton Miamisburg in Miamisburg, Ohio; the 149-room Courtyard Little Rock West in Little Rock, Arkansas; the 149-room Courtyard Oklahoma City Airport in Oklahoma City, Oklahoma; and the 149-room Courtyard Toledo Airport Holland in Holland, Ohio. The four properties under contract are expected to sell for a combined price of $31.5 million.   

CoralTree Hospitality announced the addition of Outbound Mammoth in Mammoth Lakes, California to its growing management portfolio. The 184-room resort recently completed a multi-year renovation. Outbound Mammoth offers a wide range of lodging options, from newly renovated guest rooms to 19 chalets, 10 newly-built studio cabins and a selection of guest villa accommodations. Outbound Mammoth offers three food and beverage options, an outdoor pool and hot tub, four fire pits, as well as a fitness center with a sauna and steam room.  

Although the doors of the new Holiday Inn Express Columbus Northeast, in Columbus, Georgia, opened on June 6, owner RAM Hotels held the official grand opening celebration on July 18.  

Grande Shores Ocean Resort in Myrtle Beach, South Carolina, announced the completion of a fresh new look aimed at enriching the vacation experience. The resort has re-imagined its landscape and refurbished its pool decks. The outdoor grill area received a makeover, and the resort has undergone a transformation aesthetically with vibrant blue accents.  

United Center next-generation owners Michael Reinsdorf and Danny Wirtz jointly announced plans for the largest private investment on Chicago’s West Side: a catalytic mixed-use development project that includes housing, retail, entertainment and public space on more than 55 acres of privately owned land surrounding the iconic arena campus. The first phase of The 1901 Project aims to begin in spring 2025 and will feature a 6,000-seat theater-style music hall; a one-of-a-kind elevated park providing more than 10 acres of public recreational and community gathering space; re-imagined parking facilities and improved pedestrian experience; and hotel and retail programming. Future phase development envisions housing that spans various unit sizes and transportation enhancements. All in, the $7B investment is set to deliver substantial economic benefits to the West Side.   

RobertDouglas represented Ashford Hospitality Trust, Inc. in the sale of the 193-room One Ocean Resort & Spa in Atlantic Beach, Florida to a joint venture of Aspect Real Estate, Corner Lot Development, and Sage Investments. The sale price was $87 million.  

Personnel Moves

Marriott International’s Sandeep Walia has expanded his role, adding responsibility for the group’s Luxury portfolio in Europe, the Middle East and Africato his remit. His new job title is Chief Operating Officer, Middle East & Luxury, Europe, Middle East and Africa.  

The Indigo Road Hospitality Group appointed Katharine Ames as Chief Marketing Officer. In this newly created role, she will continue to oversee all marketing efforts across the company’s portfolio, including internal communications, public relations, programming and branding, partnerships and social media. Ames previously served as Director of Marketing since joining the company in 2021. Prior to joining IRHG, Amex spent eight years at a boutique lifestyle agency.   

European Highlights

Hilton is launching a budget chain in Germany that is already present in 50 locations in America since last year. The first of several planned hotels, which are to be run under the Spark brand via franchise agreement, will open in Stuttgart-Sindelfingen at the end of the year.   

London Hilton on Park Lane has outlined the next stage of its top-to-bottom renovation program, with the unveiling of two new dining concepts set to open later this year. The hotel began refurbishment works last year to coincide with its 60th anniversary and has so far unveiled redesigned suites and executive rooms, as well as a revamped lobby area and new ground floor F&B venues. The next stage of the hotel’s transformation will see the opening of the first London outpost for Amsterdam fine dining steakhouse MR PORTER in September. This will be followed by the unveiling of the pan-Asia eatery Shanghai Me on the hotel’s 28th floor at the end of the year.   

Tivoli Hotels & Resorts announced the launch of Tivoli Portopiccolo Sistiana Wellness Resort & Spa in Sistiana, TS Italy. Following some renovation, Tivoli Portopiccolo welcomes guests to its unique location, exciting dining concepts, and two new partnerships: Purobeach Portopiccolo, a beach club, and Terme di Saturnia, which will be operating the spa. The property offers 58 guestrooms, including 20 suites, 30 branded apartments, six pools, the Purobeach Portopiccoloarea, and the Green Beach, a wellness and fitness center.   

Radisson RED Hotel & Radisson RED Apartments Krakow, a new upscale-lifestyle hotel, opened in Krakow’s iconic Unity Centre. The property features 229 rooms, along with 46 extended-stay apartments located in a separate building. The hotel offers an all-day dining restaurant and 300 square meters of space, from a 10-person boardroom to versatile meeting rooms. Unity Centre is a mixed-use development with a central square, offices, retail and residences. Radisson RED Hotel & Radisson RED Apartments Krakow is the third Radisson Hotels property in the city.