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1. MGM settles data-breach lawsuits in $45 million payout
MGM Resorts International has agreed to pay out $45 million to settle a lawsuit stemming from alleged data breaches in 2019 and 2023. Two class-action lawsuits were filed, one for each breach, with the U.S. District Court of Nevada, claiming that “a hacker stole data including sensitive information such as driver’s license numbers, passport numbers and customer addresses,” according to The Wall Street Journal.
The lawsuit claimed 37 million people’s information had been placed in jeopardy over the two incidents and that “MGM failed to implement data-security practices, resulting in the breaches.” MGM did not comment on the decision. The Wall Street Journal added MGM could still face a probe conducted by the Federal Trade Commission over the two incidents.
2. Presidential inauguration sees DC hotel metrics soar
For the week of Jan. 19-25, U.S. hotel average daily rate increased 3.4% to $154.21, but occupancy decreased 3.4% to 54.3% and RevPAR fell 0.2% to $83.74, according to CoStar hospitality data.
The best-performing market in the top 25 markets was Washington, D.C. On Jan. 20, the city hosted Donald Trump's second presidential inauguration. In D.C., hotel occupancy increased 4.9% to 59.3%, ADR increased 78% to $285.86 and RevPAR increased 86.8% to $169.23. The worst-performing market among the top 25 was Chicago, which posted a 21.3% occupancy decrease to 44.7%, a 16.1% ADR decrease to $118.30 and a 34% RevPAR decrease to $52.88.
3. EMEA Podcast: Hotel supply remains a challenge, but group is returning
Supply remains a prescient challenge facing many hotel markets in Europe. Alex Robinson, STR's director of industry partners, outlined in a conversation in the podcast “The Upgrade: EMEA Hospitality News” what he saw as the trends and headaches likely to affect the European hotel industry across the next 12 months. He said overall Europe would see continued strong business, continued strong group and meetings, incentives, conventions and exposition numbers and leisure travel maintaining its pole position.
“Supply is not going away despite challenges for project financing and the brands’ increasing focus on conversions, [although] conversions do not impact net supply growth in the same manner as new builds. The majority of projects that are opening today were incepted three to four years ago before the change in interest rates, and the cities atop the new supply leaderboard are the usual suspects, which are used to weathering new supply,” Robinson said.
4. India’s ITC debuts on stock exchange
Indian hotel firm ITC Hotels debuted on the Bombay Stock Exchange Wednesday following its publicly listed spinoff from parent ITC. The firm valued its stock at 366.2 billion Indian rupees ($4.2 billion) but saw that value drop 2.2% by the close of its first day of trading. Reuters reported “ITC Hotels’ market valuation is second only to Indian Hotels Co. Ltd. [the parent of Taj Hotels and other flags], which is valued at 1.08 trillion rupees.”
ITC operates approximately 140 hotels in India, Nepal and Sri Lanka, and news source Mint said the firm intends to expand its portfolio to more than 200 over the next five years. Lately, there has been a rush of Indian hotel firms seeking to go public. This has led to the launch of the Nifty India Tourism Index to help raise the profile of hotel and hospitality companies and to ease access to investment.
5. Ark and Lead acquire Melbourne Place hotel
Australian investment firms Ark Capital and Lead Global, backed by investment firm Pioneer Wealth, have acquired the 191-room Melbourne Place Hotel for 150 million Australian dollars ($93.5 million) from Merricks Capital. Real Estate Source reports that in 2022 Merricks placed the project into “voluntary administration mid-construction.”
The hotel occupies the former headquarters of the Melbourne Theosophical Society. Ark, based in Melbourne, and Lead, based in Myanmar, will form a joint-venture holding company for the property, which spans 15 floors. In November 2022, Financial Review reported that the hotel had a development value of AU$155 million.