MCR to Turn London's BT Tower Into a Hotel
Skift Take
The DJIA gained about 0.1%. Nasdaq fell 0.3%. The S&P 500 rallied late in the session to close up 0.1%. But as the WSJ noted: "All three indexes are up for the month and year, with the S&P 500 up 4.4% in 2024."
Travel + Leisure reported slightly better than expected 4Q results as lower expenses offset lower-than-expected revenue. TNL repurchased 1.1 million shares in 4Q for $40 million, lower than previous quarters. They also raised their quarterly dividend to $0.50 from $0.45, up 11%.
Deutsche Bank said they still see Playa Hotels & Resorts as an attractively valued stock relative to its closest peers, even though there is the potential for a modest decline in EBITDA in 2024. They believe the proper NAV for the portfolio equates to $16 per share and that they will generate enough gross free cash flow in 2024 and 2025 to mostly fill the new $200 million share repurchase authorization that was announced in December, particularly if the Jewel Palm Beach property is sold. DB’s target price is $15 and they continue to strongly recommend PLYA stock at these levels.
STR reported US lodging data for the week ended 2/17. US hotel RevPAR was up 1.6% for the week with rates up 4.2%. Group RevPAR was up 11.3%.
Paradigm Hotel Group submitted an application to the city of Napa, Californiato build a three-story hotel on Solano Avenue. According to the application, the project is branded as an AC Hotels by Marriott and will feature an interior courtyard, fitness center, 2,332 square feet of meeting space, dining area, bar and lounge, and 123 parking spaces.
Life House expands into Oaxaca, Mexico with the Management of Casa Yuma, a beachfront boutique hotel and restaurant set to open in March 2024 in Puerto Escondido. Casa Yuma will feature 25 guestrooms, a pool, co-working space, and a restaurant and bar. The ownership group behind Casa Yuma is led by Tim De Belloy, a developer from France.
An investor group has purchased nearly two acres at the Pima Medical Campusin Tucson, Arizona, to build a 122-room extended-stay hotel. WSA Arizona-Tucson paid $1.2 million for the property which will be a WoodSpring Extended Stay Hotel. The seller was an affiliate of Rio West Development of Tucson. Hawkins Cole Hospitality & Investment Real Estate handled the transaction.
After being placed in a receivership following Palisades Resorts LLC’s failure to make mortgage payments, a buyer has been lined up to acquire the Adero Scottsdale Resort. The 177-room property is set to be sold for $66.5 million. If the deal is approved, the hotel will be bought by Cabo Resort Development Partners LLC, owned by GRMM Hotel Investment Fund.
ICONA Resorts won approval by the city planning board to build a new hotel in Wildwood Crest, New Jersey. The proposal is for an upscale beachfront hotel named The Mahalo Resort. The project will break ground later this year and will be completed in 2026.
Developer Eliot Tishbi is planning an 11-story project in downtown Los Angeles, California that will include a 100-room hotel, 48 apartments, and 12,676 square feet of commercial space. The project is named The Element.
Matthews Southwest Hospitality, LLC has been tapped to serve as a consultant/advisor to the Capital Improvement Board of Managers of Marion County on the Indianapolis Convention Center Hotel and Expansion project. The $625 million project was approved by the Indianapolis City-Country Council in June 2023. The plan is to expand the convention center, which will connect to an 800-room, 40-story Hilton Signia Hotel. MSWH will lend its expertise on the development, construction, and operation of the Pan Am Plaza convention center headquarters hotel and expansion, which broke ground last July.
Harvey Hanna & Associates acquired the 23-room Crosswinds Motel in Rehoboth Beach, Delaware. With plans for extensive renovations, the firm aims to enhance the coastal town’s hospitality landscape under TKO Hospitality Management.
Hard Rock International is partnering with Major Food Group to develop and curate dining experiences at Hard Rock Hotel & Casino properties around the globe. MFG’s support of Hard Rock will extend to proposed projects as well. The partnership builds upon the ongoing collaborative efforts between the two hospitality brands following the successful CARBONE residency at Cipresso at Seminole Hard Rock Hotel & Casino Hollywood in December.
HVS Brokerage & Advisory announced the sale of the 107-key Holiday Inn Express & Suites Lubbock Central -University Area, located in Lubbock, Texas. The property was purchased by Capital One Hotel Group from Insignia Hospitality Group.
Muy’Ono Resorts introduced its newest addition, The Watermark Belize Hotel, in San Pedro, Belize. The Watermark Belize Hotel boasts two restaurant and bar concepts, 3,000 square feet of flexible event space, a scenic rooftop pool and a fitness center.
International Highlights
Kempinski announced two Chief Operations Officer appointments. Xavier Destribats, during the past seven years Chief Operations Officer, The Americas, moves back from Cuba to Geneva and takes over the European region in addition to The Americas. Timur Sentuerk, who lately oversaw Europe, the Middle East and Africa, is moving to Dubai to fully concentrate on the Middle East and Africa. Both top executives are members of the Managing Board of Kempinski Hotels.
The recent Europe Hotel Construction Pipeline Trend Report from Lodging Econometrics revealed the region’s total pipeline stands at 1,706 projects/254,937 rooms at the end of Q4 ‘23. Here are all the numbers:
Europe Hotel Construction Pipeline Overview End of Q4 2023
| Pipeline Stage | Projects | Rooms |
|---|---|---|
| Total Pipeline | 1,706 | 254,937 |
| Under Construction | 755 | 115,300 |
| Scheduled to Start Next 12 Months | 418 | 64,835 |
| Early Planning | 533 | 74,802 |
| Renovation and Conversion Projects | 558 | 76,231 |
| Q4 Conversions Alone | 412 | 54,273 |
Europe Hotel Project Classification by Market Segment End of Q4 2023
| Market Segment | Projects | Rooms |
|---|---|---|
| Upper Upscale | 266 | 44,002 |
| Upscale | 354 | 56,304 |
| Upper Midscale | 302 | 46,655 |
Top European Countries by Hotel Construction Pipeline End of Q4 2023
| Country | Projects | Rooms |
|---|---|---|
| United Kingdom | 322 | 43,990 |
| Germany | 195 | 31,839 |
| France | 127 | 14,224 |
| Turkey | 118 | 17,752 |
| Portugal | 114 | 13,869 |
Top European Cities by Hotel Construction Pipeline End of Q4 2023
| City | Projects | Rooms |
|---|---|---|
| London | 77 | 13,699 |
| Istanbul | 53 | 8,911 |
| Lisbon | 36 | 4,013 |
| Dublin | 32 | 6,106 |
| Dusseldorf | 28 | 5,228 |
European Hotel Openings Forecast End of Q4 2023
| Year | New Hotels | Rooms |
|---|---|---|
| 2023 | 316 | 41,866 |
| 2024 | 348 | 48,559 |
| 2025 | 383 | 52,337 |
Hilton announced the signing of Home2 Suites by Hilton Dublin City Centre, marking the brand’s debut in Western Europe, as part of a franchise agreement with JMK Group. The property will feature 290 rooms, multi-functional community spaces, Home2 Market, and a combined fitness and laundry facility.
The BT Tower will be transformed into a hotel after the telecom giant inked a £275m deal to sell the London landmark to MCR Hotels. The company still operates some services from the tower but these will be removed over the coming years. As part of the deal, MCR will make phased payments as remaining equipment is removed from the building. MCR will partner with Heatherwick Studio to consider how best to re-imagine the tower’s use as a hotel.
KSL Capital Partners launched the sales process for its Village Hotels chain. The private equity company has begun an auction process with a starting price of £800 million. Village Hotels’ portfolio currently comprises 33 hotels across the UK. Morgan Stanley has been appointed to run the auction.