San Francisco Area Hotel Production Dries Up

The DJIA rose 203 points, but the Nasdaq was down 223, the S&P 500 fell 27 points, and the 10-year treasury yield was down .04 to 4.14%. Lodging stocks were mixed. SHCO was down -5% on the day.

Summit Hotel Properties reported a 2Q24 earnings beat, but also gave a softer outlook for revenue. INN is offsetting this with cost containment, contract labor being the main driver. 2Q earnings were boosted by property tax appeals. INN lowered RevPAR growth for full year 2024 to 1% to 2.5% from 2% to 4%.

Tigress Financial upped their target price on Travel + Leisure to $58 from $54. They maintained their Buy rating.

As seen in the Q2 2024 U.S. Hotel Construction Pipeline Trend Report from Lodging Econometrics, at the end of the second quarter, there are 6,095 projects with 713,151 rooms in the pipeline. At the close of the second quarter, there are 1,171 projects comprising 147,611 rooms under construction.

Overall U.S. Hotel Construction Pipeline Q2 2024

U.S. Hotel Chain Scale Project Distribution Q2 2024

U.S. Hotel Openings Q1 and Q2 2024

Forecast for U.S. Extended-Stay Hotels

Forecast for New U.S. Hotel Openings

San Francisco Bay Area hotel production has come to a virtual halt in 2024, with just two properties opening up across the region’s nine counties through the first six months of the year. The latest hotel production survey from Atlas Hospitality finds sluggishness across California that has persisted since 2023. The two Bay Area hotels to open in the first half of 2024 were the 110-room TownePlace Suites by Marriott in Pleasantonand the 127-room Home2 Suites by Hilton San Jose Silver Creek in San Jose. San Francisco saw no new hotels open in the first half of this year. As of mid-2024, San Francisco has three hotel projects that are technically under construction, per the report, though the completion of one is uncertain and another highly unlikely: Waldorf Astoria San Francisco, 169 rooms, is part of the Oceanwide Center albatross that will never be built; Hearst Auberge San Francisco, 150 rooms, delayed since 2022 and whole entitlement expires April 2026; and a 20-room addition to the InterContinental Mark Hopkins Hotels. Across California as a whole, 22 hotels opened in the first half of this year, a 10% increase from the first half of 2023, but with 15% fewer rooms overall. The total number of hotels under construction statewide, as tracked by Atlas, is unchanged at 122 properties, but the group cumulatively represents 5% fewer rooms.

Construction is well underway on a new hotel at the Georgia National Fairgrounds and Agricenter in Perry, Georgia. The $30 million project, which began at the end of 2023, will feature two Marriott brands, Fairfield and TownePlace Suites, under one roof. Set to open in the summer of 2025, the 129-key hotel will include 66 rooms under TownePlace Suites and 63 rooms under Fairfield Inn & Suites. Amenities will feature a pool, fitness center, guest laundry, bar and restaurant. An air-conditioned corridor will connect the hotel to the Miller Murphy Howard Center, providing convenience for guests attending events at the Fairgrounds.

HEI Hotels & Resorts has added The Westin Dallas Downtown to its portfolio, bringing the total number of hotels managed in the Dallas market to five and a total of 15 properties in the state of Texas. The Westin Dallas Downtown features 326 guestrooms, 34,000 square feet of flexible meeting and banquet space, a three-meal restaurant and lobby bar, an indoor pool and a fitness center. The Westin is part of One Main Place, a 33-story mixed-use development that also includes office and retail.

Plans to tear down the old Vigo County School Corporation building in Terre Haute, Indiana, have been announced. While the timing of the demolition is unknown, it has been decided that the site will be used to build another hotel. Phase one of the project will cost more than $40 million. The city will get a 114-room Courtyard by Marriott. Officials expect to break ground on the new hotel before the end of 2024.

Construction of a new AC Hotel by Marriott in Pasadena has reached its full height. Welcome Group, Inc. began construction in mid-2023 on the new podium-type building that will feature 194 guestrooms, 5,000 square feet of ground-floor commercial space and a rooftop bar.

Marriott Hotels announced the grand opening of its newest property, Marriott Cancun, An All-Inclusive Resort, marking a new era for Marriott Hotels as its first all-inclusive resort. Marriott Cancun features a comprehensive range of amenities and services, beginning with 450 newly redesigned guestrooms; Greatroom with its signature bar; 13 diverse dining options; water slides, a relaxing lazy river, and multiple pools; an arcade area; The Workshop; and expansive indoor/outdoor CAMP Club by Marriott. Marriott Cancun boasts nearly 24,813 square feet of renovated event space, including four event rooms and 12 breakout rooms.

Prime Hospitality Group announced that its recently acquired Faro Blanco Resort & Yacht Club has joined the Curio Collection by Hilton portfolio. The newly rebranded Faro Blanco Resort & Yacht Club Marathon Curio Collection by Hilton debuts a transformative $14 million renovation of its accommodations, amenities, and restaurant offerings. Located in the Florida Keys city of Marathon, the Faro Blanco Resort & Yacht Club joins its sister hotel, Courtyard Faro Blanco Resort, on the same property. Faro Blanco Resort & Yacht Club offers 125 guestrooms; the historic Parrish House that will soon be renovated and restored to function as a private bungalow; four outdoor pools; four dining options, a fitness center; and a new spa opening later in 2024. Additionally, the Faro Blanco Yacht Club Marathon offers over 40,000 square feet of remaining meeting space.

Resolute Road Hospitality announced the grand opening of The Newberry Hotel in Boston, a stunning addition to the Tapestry Collection by Hilton. Previously the DoubleTree by Hilton, The Newberry Hotel has undergone extensive renovations and rebranding and offers a freshly renovated lobby, guestrooms, market, pool, fitness center and a brand-new lounge and bar.

The next addition to one of the newest shopping centers in Merced, California, is about halfway complete and set to open next year. Owned by Shemoil’s Investment Development, the Hilton Garden Inn is scheduled to open in August or September of 2025. The five-story, $36 million project will consist of 133 rooms, an outside sitting area with a fire pit and a bar area.

The receiver and a lender for the troubled Hilton San Francisco Union Square and Parc 55 hotels have eight more months to snag a buyer. Superior Court Judge Charles Haines has moved the deadline to March 31, 2025, from September 1 for the sale of two of the city’s largest hotels. The approval also pushes out the deadline for the lender to foreclose on the property if a sale isn’t completed to July 15, 2025. Last summer, Park Hotels & Resorts defaulted on a $725 million loan tied to the 1,921-room Hilton and the 1,024-room Parc 55. In October, a court-appointed receiver, Hotel Asset Value Enhancement, took control of both hotels, with plans to sell them in less than a year. Hotel Asset Value Enhancement and the lender, JPMorgan Chase, have asked the court to extend the sale deadline. The reason for the extension was not disclosed in legal filings by the loan trustee, Wilmington Trust. Eastdil Secured holds the listing for both properties.

After years of planning, construction on a new hotel in downtown Maryville, Tennessee is finally growing near. According to a release from city staff, the project should last 18-24 months and will disrupt downtown parking options until its completion. The 98-room Holiday Inn will boast its own 119-space parking garage underneath and, according to developer Devi Capital, will boast a rooftop bar and restaurant.

Jan Van Haute, the new owner of The Inn at Vaucluse Spring in Stephens City, Virginia, is embarking on a $4.5 million renovation of the property. When renovations are finished in 2025, the Inn at Vaucluse Spring will be complete with a spa, two restaurants, and 15 overnight suites on 44 acres of land.

YourSpace Partners broke ground at the inaugural site of YourSpace, its new modern extended-stay hotel brand. The flagship site will boast a 4-story, 122-room hotel in Chesapeake, Virginia. YourSpace will offer distinctive amenities, including fully furnished kitchens, in-suite washers and dryers, secure personal storage facilities, on-demand food and beverage offerings, and state-of-the-art security and technology integration. The target opening date for the YourSpace Chesapeake location is in the Summer of 2025. YourSpace Partners plans to launch two additional locations in Suffolk, Virginia, and Elizabeth City, North Carolina, within the next year.

Rebel Hotel Company announced the redesign of the White House Napa, the company’s first venture in California, and its expansion on the West Coast. The multi-million dollar transformation aims to elevate the guest experience with updated interiors and enhanced amenities. Situated on an estate in Napa, California, White House Napa offers 17 unique designed rooms and a revitalized outdoor pool area.

Personnel Move

Grace Bay Resorts appointed Sara Archibald as Northeast Regional Director of Sales. In her new role, Archibald will manage and oversee the sales operations in the Northeast region of the U.S., including designing plans to meet sales targets and developing and cultivating relationships with clients. Archibald joined Grace Bay Resorts from Virtuoso, where she served as Account Manager.