Park Hotels Reveals Impact of Labor and Weather Events

The DJIA was up another 304 points while Nasdaq rose 12 and the S&P 500 was up 6 points. The 10-year treasury yield was flat at 4.31%. Lodging stocks had a good day with new highs scored by HLT, MAR, WH, IHG, TNL, and PLYA. VCSA was up 17% while SOND gave back -9% on the day.

Needham cut their price target on Vacasa to $3.25 from $5. They maintained their Buy rating on VCSA.

Playa Hotels price target was raised to $12 from $10 by Oppenheimer. They maintained their Outperform rating on the stock.

Park Hotels reinstated their 2024 earnings guidance following operators and the labor unions entering into new agreements. PK said the strikes took their toll as October 2024 comparable RevPAR is expected to be -1.3% lower than last year. If you back out the four hotels where the unions had the workers holding them hostage, RevPAR would have been up by 480 basis points. For 4Q24, PK expects the four hotels to negatively impact the year-over-year comparable RevPAR growth by 600 to 700 basis points. Between Hurricane Milton and Helene and the labor strikes, PK expects 4Q hotel adjusted EBITDA to be disrupted by about $30 million. They do expect the group business they lost to rebook. On a positive note, PK said they will give a 4Q dividend of between $0.60 and $0.66 per share, reflecting the regular quarterly cash dividend of $0.25 plus a top-off annual dividend of between $0.35 and $0.41. PK typically gives a 65% to 70% payout ratio for its full-year adjusted FFO per share. This would mean the annual dividend yield would be around 9.6%.

Daytona Beach, Florida welcomed a new hotel with the opening of the Renaissance Daytona Beach Oceanfront Hotel. The hotel features 190 guestrooms and suites, more than 12,000 square feet of indoor and outdoor event space and an onsite restaurant.

Sonesta International Hotels Corporation announced the opening of ACP Hotel Houston Westchase, MOD Collection by Sonesta. Located in Houston, Texas, the 120-room hotel marks the soft brand’s first location in the United States and second location in North America.

IHG Hotels & Resorts celebrated the opening of the new Holiday Inn Express & Suites Haltom City - Ft. Worth in Texas. Owned by Al Karmali and managed by DFW Hospitality Group, the hotel offers 125 rooms, 1,150 square feet of meeting space, EV chargers, an outdoor pool, and a fitness center.

The once beloved Cape Codder Resort, in Hyannis, Massachusetts, has officially transformed into a Margaritaville Resort following a $30 million renovation project which included the addition of new rooms, updated dining spaces, and amenities including a full, indoor water park.

Clearwater Beach, Florida, will soon be home to a new condo-hotel concept that allows owners to rent out units on platforms like Vrbo and Airbnb. ARC Realty broke ground on October 26 on the CW Resort & Marina which will include 91 units across eight stories. The project will feature a terrace overlooking the water with a heated outdoor pool and hot tub, private cabanas, a fitness center, and a bar/restaurant. CW Resort & Marina will also include 45 boat slips, 37 of which will be available for purchase.

The Aqua Beach Inn in Myrtle Beach, South Carolina, is for sale on the commercial real estate listing platform LoopNet. The 60-room hotel is listed for $5.9 million.

According to the Winston-Salem Journal and FOX8, Salem Academy and College is converting its former Academy building into an 86-room boutique hotel that will feature multiple meeting rooms, a restaurant, and a bar. Located in Winston-Salem, Massachusetts, the building has three wings and has been unoccupied since 2020 after a previous administration determined the building required significant repair work. Construction is expected to take between 12 and 24 months with a planned 2027 opening. Salem is partnering with Mayfair Hospitality Group for the $30 million campus hotel. A name for the hotel has not been chosen, and a national hotel chain is likely to be the operator.

HVS Brokerage & Advisory announced the sale and financing of the 72-key Holiday Inn Express & Suites Houston Northwest Tomball Area, located in Tomball, Texas. The property was purchased by Mickle & Lucky Estates LLC from PH Lodging Tomball LLC. The financing was structured with an SBA 7(a) and pari-passu loan at 70% loan-to-value through an active lender that has a strong relationship with the HVS Brokerage & Advisory team.

Personnel Move

Marriott Vacations Worldwide Corporation announced that Scott Weisz has been promoted to Executive Vice President, Strategic Business Operations. In his role, Weisz will lead the enterprise’s work to accelerate core and new product growth, as well as help drive additional operating efficiencies through continued business modernization. Weisz has held several leadership roles in his more than 20 years with the company, including leading global inventory and revenue management strategies, and overseeing the east region of The Marriott Vacation Club’s vacation ownership business.

Europe Highlights

Aprirose has sold a Premier Inn asset in Liverpool, England, as it steps up its move to acquire more opportunistic and value-added opportunities. The 165-bedroom hotel was sold to an investment charity following competitive bids. Mark Bruce-Lockhard advised on the sale for Aprirose, and Freedman & Hilmi advised on the legal parts. Parkdales advised the purchaser.

KKR & Co. Inc. and Baupost Group bought a 33-hotel portfolio from the Abu Dhabi Investment Authority for £900 million, according to Green Street News. The hotels are all located in the United Kingdom and are all Marriott International hotels under its Marriott and Delta by Marriott flags.

Plans to convert a historic manor house in Tunbridge Wells, UK, into a boutique hotel and spa have been revealed. Groombridge Place had been closed for renovation since March last year. Set to open as The Pig at Groombridge in 2026, bosses say the project represents more than £20m of investment. Plans for work to the country home and more than 100 acres of surrounding land have now been submitted to Tunbridge Wells Borough Council. Luxury hotel brand The Pig announced plans included the main manor house of the estate, which is set to host nine en suite bedrooms for guests. Other buildings on the site will be used for guests, creating 56 bedrooms in total.

KE Hotels has added the Newcastle Hampton by Hilton hotel to its portfolio under a hotel management agreement, alongside the Hampton by Hilton Birmingham Broad Street and Hampton by Hilton Sheffield.

Corum Asset Management has bought the newly built Tribe Milan Malpensa hotel from Foruminvest for an undisclosed amount. The Tribe Hotel, with its 240 rooms, is located next to the international terminal of Malpensa Airport in Italy and is fully leased to Amapa Group for an initial term of 30 years.

As previously reported, the British fund Pygmalion has recently put on the market a portfolio of nine hotels of the Silken brand, for which it is asking €240 million. According to CE NoticiasFinancieras, Javier Catalan, son of the founder of Zenit Hoteles, denies the statements by Pygmalion. According to Javier, the portfolio is not for sale and has never been for sale. He has been offered up to €380 million and he has not accepted.