HotelNewsNow.com each week features a news roundup from a different region of the world. Today’s compilation covers the Americas.
U.S. hotel results for June show year-over-year improvement
In year-over-year measurements, the United States hotel industry’s June occupancy was up 6.9 percent to 65 percent, average daily rate ended the month with a 1-percent increase to US$98.33, and revenue per available room rose 8 percent to US$63.87.
• Read “STR: Chain-scale segments post mostly positive June results.”
Jones Lang LaSalle Hotels announced that the volume of United States hotel transactions for the first six months of 2010 eclipsed US$2.2 billion, increasing 153 percent from the same period in 2009. This is according to Jones Lang LaSalle Hotels’ proprietary database, which tracks true asset transactions US$10 million and above, and excludes note sales, recapitalizations and foreclosures.
• Read “US hotel transactions up 153% in first half of 2010.”
California foreclosures increase
Atlas Hospitality Group released its second quarter 2010 Distressed California Hotel Survey. The survey found that the number of hotels in default or foreclosed on continued to escalate during the second quarter.
Second quarter 2010 survey highlights include:
• 478 California hotels are in default or have been foreclosed on, an 18-percent increase from the first quarter of 2010 and 132 percent over the second quarter of 2009.
• The number of foreclosed hotels increased 27 percent from the first quarter, from 79 to 100.
• The total number of hotel rooms foreclosed on was at 7,560, up 255 percent from the same period in 2009.
• The largest hotel to be foreclosed on was the 512-room Holiday Inn in San Jose.
• Read “Atlas: Q2 California hotel defaults, foreclosures rise.”
Sharp leaves Four Seasons CEO role to Taylor
Four Seasons Hotels. announced that Isadore Sharp decided to transition from his role as CEO, and Kathleen Taylor will be appointed president and CEO, effective 1 August 2010.
NYU: CapEx to decrease in 2010
U.S. lodging industry capital expenditures are forecast to decrease in 2010, following a decrease in 2009 for the first year since 2003, following years of increasing and record CapEx spending, according to a study by Bjorn Hanson, divisional dean and clinical professor of hospitality and tourism management at the NYU Preston Robert Tisch Center for Hospitality, Tourism, and Sports Management.
The forecast for the coming year is for capital expenditures of approximately US$3.0 billion, which represents a decrease of 9.9 percent from 2009 levels, following a decrease of 40 percent in 2009. An estimated US$5.5 billion—a record amount—was invested in capital improvements for existing U.S. hotels in 2008.
• Read “NYU study: CapEx expected to decrease again in 2010.”
Hotel Industry Leading indicator increases for fourth month
The U.S. Hotel Industry Leading indicator, or HIL, went up 1.5 percent during May, the fourth monthly increase after a slight dip in January's reading, according to economic research firm e-forecasting.com in conjunction with STR.
HIL is a monthly composite leading indicator that, on average, leads the industry’s business activity four to five months in advance. The latest increase brought the index to a reading of 113.5. The index was set to equal 100 in 2000.
Notable transactions
InterContinental Hotels Group sold the 422-room InterContinental Buckhead Atlanta (Georgia) to Pebblebrook Hotel Trust for US$105 million in cash. IHG will continue to manage the hotel under a long-term management contract.
Pebblebrook Hotel Trust also acquired the Sir Francis Drake Hotel for US$90 million from a partnership led by The Chartres Lodging Group, LLC. The 416-room, upper-upscale, full-service hotel is located in downtown San Francisco in the heart of Union Square. The hotel will continue to be managed by Kimpton Hotels & Restaurants.
Chesapeake Lodging Trust entered into a definitive agreement to acquire the 430-room Boston Marriott Newton located in Newton, Massachusetts, for a purchase price of US$77.25 million, or approximately $180,000 per key.
An affiliate of Marriott International purchased the former Seville Beach Hotel and development site in Miami Beach, Florida, for US$57.5 million in cash from 2901 Beach Ventures. Reports indicate this will be the second location for the boutique Edition brand.
Chatham Lodging Trust acquired the 120-room Hampton Inn & Suites Houston—Medical Center in Houston for US$16.5 million.
Privately held Noble Investment Group acquired the 126-room Holiday Inn Charleston (South Carolina) Historic District. Noble concurrently acquired an adjacent land parcel and has obtained entitlements to add 50 hotel guestrooms and 2,500 square feet of meeting space to the existing asset. Noble will complete the guestrooms and meeting space expansion in tandem with a comprehensive renovation of the current hotel. In 2011, the hotel will be re-branded as the Courtyard by Marriott Charleston Historic District with 176 guestrooms and 5,000 square feet of meeting space.
Openings, other news
Hilton Hotels, in partnership with the Franklin County Convention Facilities Authority, broke ground on the Hilton Columbus Downtown in Columbus, Ohio. The US$140-million convention hotel is expected to open in fall 2012 and will feature 532 rooms, 48 suites and 22,800 square feet of meeting space, including a 12,000-square-foot ballroom.
Conrad Hotels & Resorts will raise its flag in New York’s Financial District in the fourth quarter of 2011. The Conrad New York will be the brand’s fifth property to open in the U.S. and the first Conrad hotel in New York City. Located at the current site of the Embassy Suites New York, the hotel will house 463 luxury rooms
A major, multimillion-dollar building refurbishment project for what will become the Doubletree by Hilton, Panama City, Panama, will be operated by Blue Star Hospitality, S.A., under a franchise license agreement with a subsidiary of Hilton Worldwide. The scheduled completion and opening for the hotel is in the fourth quarter of 2010.
Great Wolf Resorts signed license and management agreements related to the development of a new 600-suite Great Wolf Lodge resort in Garden Grove, California, International West Resort.
Choice Hotels International announced plans for a future 156-suite Comfort Suites hotel in downtown Atlanta with franchisee Atlanta Underground, LLC. The hotel will be co-owned by Excel Hotel Group and restoration and renovation company S&A Industries.
Choice Hotels International broke ground on the company's first Suburban Extended Stay Hotel properties for Canada in Estevan, Saskatchewan, and Thompson, Manitoba.
Marriott International will open its first Marriott-branded hotel in Guyana in 2013. The 160-room Georgetown Marriott Hotel will operate under a management agreement with Atlantic Hotel. AHI is currently owned by the government of Guyana as part of a public-private partnership.
Starwood Hotels & Resorts Worldwide, in a franchise agreement with Libertador Hotels, Resorts & Spas announced the opening of Tambo del Inka, a Luxury Collection resort in the sacred valley of Urubamba, Peru, as part of its long-term growth strategy in South America. The Luxury Collection will also open its third hotel in Peru in 2011 with the debut of Palacio del Inka in Cusco.