Hilton's Huge Expansion in 2024

The DJIA rose 289 points, but Nasdaq was freaked out about the Chinese AI app and plunged 612 points. The S&P 500 was down 89, and treasuries were a safe haven with the 10-year treasury yield down 0.10 to 4.53%. Lodging stocks were modestly higher. SVC topped the gainers, up 6%, while SOND was down -6%, and AHT fell -5% on the day.

Bank of America Securities raised their price target on Choice Hotels to $165 from $160. They maintained their Buy rating on the stock. They are expecting a 4Q earnings beat from the lodging group as RevPAR has tracked above the high end of outlook ranges. BofA Securities also upped Travel + Leisure to a Buy from Underperform. They upped their target price to $60 from $40.

Truist Securities reported on a conference call they held with HotStats. The call included commentary on profit margins, with HotStats saying the U.S. is the global market that experienced the greatest profit margin erosion in 2024, with the tough labor cost growth environment mostly to blame. They feel hotels will have significant catering/banquets and meeting spaces and have better relative positioning. Within the global market, HotStats said Europe outperformed on GOP percentage growth and the Middle East on GOPPAR. Truist said they continue to view Ryman Hospitality as best positioned among Hotel REITs, as U.S. hotel meeting space-related revenues are growing ahead of rooms revenue with superior relative flow to profits. Truist also remains somewhat favorable about the development environment for new construction low-ADR U.S. hotels as these hotels were able to achieve positive flow-through/flex despite revenue declines YTD through November.

According to the Q4 2024 Canada Construction Pipeline Trend Report by Lodging Econometrics, Canada’s total construction pipeline has reached 333 projects/43,413 rooms. At year-end 2024, projects under construction stand at 76 projects/10,442 rooms. Projects scheduled to start construction in the next 12 months total 87 projects/11,698 rooms. Projects in the early planning stage close the quarter with 170 projects/21,273 rooms. By chain scale, upper midscale hotels dominate with 132 projects/14,039 rooms. The upper upscale segment follows with 62 projects/8,570 rooms, while upscale properties total 25 projects/5,591 rooms. Ontario leads in provincial development with 200 projects/26,976 rooms. British Columbia follows with 59 projects/8,480 rooms, then Quebec with 24 projects/2,714 rooms, and Manitoba with 14 projects/1,432 rooms. The top cities in Canada’s construction pipeline are led by Toronto with 70 projects/10,053 rooms, Vancouver with 25 projects/4,375 rooms, Niagara Falls with 20 projects/5,652 rooms, Montreal with 18 projects/2,199 rooms, and Ottawa-Hull with 14 projects totaling 1,991 rooms. Renovation and brand conversion activity reached new highs with conversion counts of 83 projects/8,218 rooms, while combined hotel renovations and brand conversions total 120 projects with 14,974 rooms. New project announcements remain strong, with 36 projects/5,057 rooms announced in Q4 2024. Through Q4 2024, Canada opened 15 new hotels with 1,478 rooms. LE is forecasting 43 new hotels/5,321 rooms to open in 2025 and another 43 new hotels bringing 6,547 rooms for 2026.

Hilton added 973 hotels and nearly 100,000 rooms in 2024, achieving a net unit growth of 7.3%. Hilton also strengthened its development pipeline, signing more than 1,430 hotels representing 154,000 rooms in 2024. The company’s pipeline now stands at roughly 3,600 hotels, totaling more than 498,500 rooms. Hilton’s growth has been bolstered by a number of global milestones, meeting guest demand in new locations and market segments for Hilton. Lifestyle brands Graduate by Hilton and NoMad joined Hilton’s portfolio in the spring of 2024. The launch of an exclusive partnership with Small Luxury Hotels of the World added hundreds of independently minded luxury hotels to Hilton’s luxury portfolio. Additional marquee openings slated for this year include Waldorf Astoria New York, Waldorf Astoria Costa Rica Punta Cacique, Waldorf Astoria Shanghai Qiantan, Waldorf Astoria Osaka, Waldorf Astoria Morocco Rabat-Sale, Conrad Hamburg, Conrad Athens, and Signia by Hilton Amman. Spark by Hilton opened its first hotel in September 2023 and has now surpassed 100 trading hotels, including locations in the UK, Canada, and Austria, with plans to further expand the brand in new markets around the world. Long-stay brand LivSmart Studios by Hilton, launched in 2023, expects to open its first hotel this summer in Kokomo, Indiana, with hundreds more in various stages of negotiation.

The Planning and Zoning Commission of Reynoldsburg, Ohio, has approved a TownePlace Suites by Marriott at 2467 Taylor Square Drive. The hotel, which is being developed by 256 Hotel Group, LLC, will have 104 rooms and amenities including a fitness center, pool, and business center.

Pyramid Global Hospitality celebrates 2024 as a year of significant growth, innovation, and recognition. Pyramid grew its footprint in November 2024, merging with Axiom Hospitality, a move that bolstered the portfolio with 30 properties in Europe and the UK. In the U.S., the company expanded both its collection of branded properties and independent resorts and hotels – Benchmark Resorts & Hotels. Pyramid Global grew its footprint in premium destinations by welcoming the Arizona Biltmore in Phoenix, Chatham Bars Inn in Chatham, Massachusetts, and the Naples Grande Beach Resort in Naples, Florida, among others. In July, Pyramid broadened its service menu with the introduction of PYRAMIDWORKS, a new hospitality management company segment that provides expertise in workplace management.

McWhinney has acquired Thompson Denver, located in the LoDo neighborhood of Denver, Colorado. The acquisition includes the hotel property and its associated amenities. The 11-story, 216-key new build hotel, developed and formerly owned by T2 Hospitality, features over 10,000 square feet of meeting and event space, a fitness center, and onsite dining.

IHG Hotels & Resorts celebrated the opening of a newly converted Holiday Inn Express & Suites in Leesburg, Virginia. The hotel offers 80 rooms, 812 square feet of meeting space, an indoor pool, and a fitness center. Holiday Inn Express & Suites Leesburg – Historic District is owned and managed by Leesburg Investments II, LLC.

The Perry Hotel Naples is now open in North Naples, Florida. The 160-room boutique hotel boasts ground-level and rooftop pools, multiple food and beverage venues, and enhances its offerings for semi-private dinner gatherings and exclusive social events through an exclusive partnership with the neighboring Bay House Restaurants, owned by Phelan Family Brands.

A new, nine-story full-service hotel is coming to downtown Syracuse, New York. The Onondaga Hotel is expected to have 240 rooms, community space with ground-level retail, parking, banquet facilities, and a rooftop restaurant and bar. It will also feature a 3,800-square-foot ballroom and breakout rooms for meetings. The $87 million investment into downtown is led by Sun Companies. The project will be part of Hilton’s Curio Collection.

The Omni Interlocken Hotel in Broomfield, Colorado, announced the completion of a full-scale renovation that spans all 390 guestrooms, five distinct dining experiences, a fitness center, a 27-hole championship golf course, Mokara Spa, and refreshed pool areas. In addition to upgraded recreational offerings, the hotel now boasts an expanded 40,000 square feet of flexible meeting and event spaces, including 9,000 square feet of outdoor event space.

An Augusta, Georgia hotel on the market for much of 2024 has been sold. The dual-branded Red Roof Inn/HomeTowne Studios Augusta fetched a $4 million asking price, according to Cushman & Wakefield, who handled the transaction. Neither the buyers’ nor the seller’s identities have been publicly disclosed. The new owners intend to continue operating the 138-room property as a Red Roof Inn/HomeTowne Studios dual-brand hotel. The plan is to renovate, invest in the property, and maintain its current operations.

CL Real Estate told the city council of Hillsdale, Michigan, that it needs until September to finish its renovations to The Keefer House Hotel, which was supposed to be completed in 2021 but has suffered from a series of delays. The company now has until September 2025 to complete construction.

KPC Development Co has begun construction of the Kali Hotel, Hollywood Park in Inglewood, California. According to hotelprojectleads.com, the $300 million, 13-story, 300-guestroom hotel will be part of Marriott’s Autograph Collection. Plans call for a rooftop bar, three restaurants, a pool deck, a fitness center, 20,000 square feet of meeting space, and subterranean parking for 315 vehicles.

Waimea Plantation Cottages, positioned along the shore of West Kaua’i, Hawaii, announced its Premier Cottage Collection. The Premier Collection comprises four unique homes among the resort’s 59 vintage cottages on 43 oceanfront acres along the ocean. Amenities of the resort include an oceanfront pool, sand volleyball court, and an onsite restaurant. Waimea Plantation Cottages is a Coast Hotels Ltd. property.

Acqualina Resort & Residences, an ultra-luxury Miami oceanfront property, unveiled its newly enhanced event spaces. The new ballroom and re-imagined boardroom provide the perfect setting for an array of events. In addition to its interior and exterior venues, the resort features 98 guestrooms and suites, 188 residences, multiple restaurants, three oceanfront pools, and the Acqualina Spa. Acqualina Resort & Residences is a member of The Leading Hotels of the World.

Grupo Riu closed on the purchase of a new property in Mazatlan, Mexico, where they will build a 700-room hotel. The company expects to obtain the construction and environmental permits within 18 months to begin construction of the hotel.

American Hotel Income Properties REIT LP announced the completion of a CMBS refinancing for five hotel properties with total gross proceeds of $43.0 million and the repayment of $38.4 million to the term loans comprising part of AHIP’s senior credit facility governed by the Sixth Amendment. The CMBS Loan has a five-year term and bears interest at a fixed annual interest rate of 7.63%.

Personnel Move

Ashford Hospitality Trust accepted the resignation of Mr. Kamal Jafarnia, effective January 24, 2025. The resignation was not the result of a disagreement with the company on any matter related to its operations, policies, or practices. Pursuant to the company’s director retirement program, Mr. Jafarnia is entitled to a $120,000 payout, which the company will pay in cash.

Europe Highlights

Newmark Group, Inc. announced that London-based real estate advisory firms BH2 and Gerald Eve now operate as Newmark. Newmark now operates from more than 20 European offices across multiple business lines and property types.

Israel Canada Hotel Group has acquired Brown Hotels for £25 million. Brown Hotels filed a debt settlement proposal in court, which will see Israel Canada purchase Brown Hotels’ business operations in Israel, which comprises 10 hotels, and the chain’s eight hotels in Greece. As part of the deal, Israel Canada Hotels will pay NIS 38.5 million (around £8.6 million) in cash and assume an additional debt of around NIS 74 million (around £16.6 million) to cover Brown’s financial obligations to various institutions.

Small Luxury Hotels of the World welcomed 80 new additions in 2024 and expanded its global footprint in destinations such as Anguilla, Ecuador, Guatemala, India, Lithuania, Pakistan, Poland, Sri Lanka, and Tanzania. In 2025, SLH will introduce seven new openings, including two outposts in Italy. The Plein Hotel will open in Milan in January, and The Goethe Hotel will open in Rome in February. Park Lane Hotel will open in Copenhagen in January 2025, following extensive renovations. In April 2025, the ultra-luxury Hermes Galapagos Mega Catamaran sets sail, and Barrington’s Hotel & Residences in Almancil, Portugal, will also open in the same month. Laguna Coast Resort opens in Naxos, Greece, in May 2025. The Levantine Hill Estate, in the heart of the Yarra Valley, will open a new boutique hotel complex, Levantine Hill Hotel, in June 2025.

The Hotel Bauer in Venice has been acquired by Mohari Hospitality with Omnan Investment, according to the Italian press. The value of the purchase was about 300 million euros, to which will be added 150 million euros of investment to renovate the 120-room hotel.

Ginto Hotels announced the purchase of the 30-room Hotel Aria and 56-room Hotel Vendome located in the heart of Nice. By adding these new locations in southeastern France, Ginto Hotels collection now comprises 294 rooms across eight properties.