Hyatt Hotels and Playa Hotels Discuss a Deal

Holiday Schedule: The final Daily Lodging Report for 2024 will be on Tuesday, December 24. The first DLR of 2025 will be January 2, 2025. We wish you all a happy and healthy holiday season.

The DJIA was up 67 points while Nasdaq was up 192, the S&P 500 rose 43 points, and the 10-year treasury yield closed at a 7-month high, up .08 to 4.60%. Lodging stocks were higher. PLYA surged 29% to a new high on the Hyatt news. H was down -1.4%. SHCO bounced 6%, and VCSA was also up 6% on the day.

Hyatt Hotels and Playa Hotels & Resorts said they entered an exclusivity agreement for PLYA and H to negotiate potential strategic alternatives. Since H and PLYA already have a relationship on a few resorts and H owns a 9.9% stake already, everyone knows the negotiations would be about H acquiring them. PLYA has said they are open to a sale, and some of their board members have made it a habit to sell stock regularly. H could see entry into new markets or an increase in others, a bigger all-inclusive footprint, and additional fee streams. While Truist said they see a greater likelihood than not that this transaction will be completed, Baird said they do not see H acquiring PLYA in an all-cash or cash-and-stock transaction. The hang-up for Baird is the real estate ownership, although Truist said they see H or PLYA selling off the real estate in connection with this transaction. Unlike the last potential deal announcement, when Soho House was acquired, PLYA stock reflects where most think the deal would be done, around $13 or slightly higher. SHCO is still trading -20% below what their takeover price is supposed to be at ($9).

Despite facing challenges from subdued summer demand and a sluggish third quarter, U.S. hotel performance is expected to reaccelerate in the fourth quarter and extend into 2025, according to CBRE’s latest forecast. CBRE now forecasts a 0.5% increase in RevPAR growth for 2024, down from the previously estimated 1.2% in August. In Q3 2024, hotel demand declined 0.1% year-over-year, coupled with a 0.6% increase in supply, resulting in an approximately 0.8% decline in occupancy. Modest ADR growth of 0.6% fell short of CBRE’s previous expectation of 1.6%, leading to a 0.2% decrease in RevPAR for the quarter. CBRE forecasts a compound annual growth in supply of 1% over the next five years, below the industry’s long-term historical average of 1.6%. The forecast includes GDP growth of 2.6% and average inflation of 2.9% for 2024.

Between January and November of this year, Quintana Roo in Mexico added 4,294 new hotel rooms, representing a 3.2% growth in the number of rooms compared to 2023. This has allowed it to add a total of 134,417 rooms and 1,443 lodging centers throughout the state, positioning it as the largest tourist offering in Mexico and the Caribbean region. It has also had one of the largest growth levels at a national level since August of this year. CBRE placed Quintana Roo as the number one entity in hotel growth with 68% of the 4,000 rooms that had been built in the whole country up to that month, ahead of Mazatlán with 20% and Los Cabos with another 10% of that total. More hotel openings are expected for the rest of the year, according to Ramon Rosello, president of the Costa Mujeres Hotel Association. This year, 2024, QR will be closed at 10,000 due to the three hotels that are being finished and will be inaugurated this year. He added that this construction rhythm will not stop because, by the end of 2025, they expect the opening of St. Regis, Excellence, and Palladium. If there is no delay in those announcements, QR’s participation at a national level in terms of new hotel keys will exceed by far the 68% that CBREassigned to it in its statistical monitoring.

The San Francisco Hyatt Hotel approved a new union contract, ending the three-month strike.

Access Real Estate and Witkoff announced the opening of The Belgrove Resort & Spa, Autograph Collection, located in West Palm Beach, Florida. The Belgrove’s property-wide transformation is expected to encompass 150 guestrooms as well as public spaces, including the arrival experience and lobby, five dining options, fitness and spa facilities, two pools and outdoor patio areas, and over 21,000 square feet of meeting and function spaces. Anticipated by the end of 2025, 22 villas will be constructed to provide additional inventory and investment opportunities. Located within The Belgrove Resort & Spa is Dutchman’s Pipe Golf Club, a private, members-only sanctuary featuring a golf course and racquet center with tennis courts, pickleball courts, and Padel courts.

In Pine Bluff, Arkansas, officials signed off on a plan by P3 Group to turn what was formerly the Plaza Hotel into a Courtyard by Marriott. The new project will cost north of $20 million and will have between 125-175 guestrooms. Groundbreaking for the new hotel will start sometime in the new year.

The unopened Hotel Amalga, Tribute Portfolio Hotel by Marriott, in St. Augustine, Florida, sold for $20.5 million. The seller is Jabalia Development Group through Amalga Hotel of St. Augustine LLC. The buyer is HOS Management through Amalga Lodging LLC. Amalga Lodging LLC took out a $12.5 million mortgage with MidFirst Bank of Chicago.

Marx Development Group is developing Hotel Meta, a 51-story hotel in the Hudson Yards neighborhood of New York City. The 379-room property will feature a business center, ballroom, banquet and conference spaces, a spa, fitness center, and a multi-level restaurant with a bar and outdoor terrace. The hotel will be operated by Marriott Hotels. Marx Development Group secured $185 million in refinancing this spring, including an $89 million senior loan from Madison Realty Capital, a $44 million mezzanine loan from Cerberus Capital Management, and EB-5 financing. Prior to this, the hotel was planned to open under the Aloft brand.

The Hotel Group, an affiliate of Hotel Equities, and TE Miller Development, LLCannounced the topping-off milestone for the Home2 Suites by Hilton Kalispell, Montana. The 107-room extended-stay property is slated to open in late spring 2025. Hotel amenities include an indoor pool, an outdoor fire pit and grilling area, a fitness and laundry space, and a market.

Hyatt Centric South Beach Miami announced the completion of its renovations. The updates include newly re-imagined rooms and suites, check-in lobby, and communal lounge areas. The 105-room hotel also features an outdoor pool with cabanas and an onsite restaurant.

IHG Hotels & Resorts announced the opening of a new-build Holiday Inn Express & Suites hotel in Abilene, Texas. The 65-room hotel offers more than 1,200 square feet of meeting space and a business center. Holiday Inn Express & Suites Abilene operates under the ownership of Ashish K. Ghosh Hajra.

Mandarin Oriental, Miami will be closing on May 31, 2025. Mandarin Oriental and Swire Properties are collaborating on an entirely new Mandarin Oriental, Miamiand the introduction of The Residences at Mandarin Oriental, Miami, set to debut in 2030. Comprising two towers, the South Tower will feature 228 residences, while the North Tower will house the new North American flagship Mandarin Orientalhotel, offering 121 keys, including 34 suites, a signature Spa at Mandarin Oriental, and multiple fine-dining and al fresco restaurants and 28 hotel residences.

Palm Tree Crew opened its first-ever hotel and restaurant, Palm Tree Club Miami, in collaboration with Think Hospitality and Continuum Company. The newly renovated 115-room hotel and restaurant transformed the former Shuckers Waterfront Grill and Hotel into a vibrant destination. The hotel features onsite dining, live music and cultural events, a 20-slip marina, fitness center, and a pool deck.

Hotel Humano by Grupo Habita and a member of Design Hotels is open in Puerto Escondido, Oaxaca, Mexico. The hotel offers 39 rooms, including 8 suites, a rooftop garden, and a central courtyard with a pool, sun loungers, restaurant, bar, and outdoor spa. The roof features an alfresco restaurant. Come summer 2025, Hotel Humano will unveil the Beach Club, featuring six private bungalows, an oceanfront pool and sun deck, and an additional restaurant.

Club Med announced a new water park at Club Med Punta Cana and major renovations at Club Med Cancun, Club Med Gregolimano, and Club Med Serre Chevalier. Club Med’s largest water park is now open at Club Med Punta Cana across three vibrant zones: Water Games, Bubble Pool, and Water Slides. The water park will soon include a family-friendly food truck. Club Med Cancun has transformed its family offerings, including Sports and Wellness Island, a Dedicated Family Oasis, and Children’s Clubs, with new play facilities and a water park. Club Med Gregolimano has reopened following a $32 million renovation, which expanded its room capacity to 497 and introduced new eco-friendly upgrades. A new wellness area features treatment cabins, a Zen pool, paddle courts, and yoga classes. Club Med Serre Chevalier is located at the foot of the Alpine slopes with direct access to a 250km ski area, a new high-speed gondola, and winter activities. In the first half of 2024, Club Med achieved $1.25 billion in business volume, marking a 9% year-over-year increase.

DSH Hotel Advisors announced the sale of the 68-room Comfort Inn & Suites in DeLand, Orlando. The firm represented both the seller, VSK Express, LLC, and the buyer, SHIVA 400, LC. The exact sale price remains undisclosed.

Personnel Moves

On and effective December 20, 2024, the board of directors of LuxUrban Hotels Inc. appointed Brian Ferdinand, Brando Elster, Alex Moinian, Daniel Shapiro, and Bradley Theodore to fill director vacancies on the board. The board determined that Moinian, Shapiro, and Theodore are independent under the listing rules of the Nasdaq Stock Market, LLC, and each shall serve on the audit committee, compensation committee, nominating and corporate governance committee, and risk, finance, and investment committee of the board. Previously, Mr. Ferdinandserved as Chief Executive Officer and Chairman of the Board of the company prior to transitioning into a consultant role.