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1. Interest-Rate Hikes Could Go Further Than Expected
Not that long ago, some watchers of The Federal Reserve were hopeful broad economic signs — chiefly cooling inflation — could lead to a scaling back of planned interest-rate hikes, but Bloomberg now reports just the opposite may be in the cards, with The Fed now possibly pushing rate hikes further than initially planned and hoped.
"Economists are marking up their estimates of what’s known as the terminal rate — the highest point that the Fed will get to," the news outlet reports. "Deutsche Bank Securities chief U.S. economist Matthew Luzzetti this week raised his forecast to 5.6% from 5.1%, citing a resilient labor market, easier financial conditions and elevated inflation."
2. Dalata Buys London Maldron Hotel
Ireland-based Dalata Hotel Group has acquired a property that will open as a Maldron-branded hotel in London for 44.3 million pounds sterling — or $53.1 million — HNN's Terence Baker reports.
The 192-room property will open this summer in the Finsbury Park district.
In the news release announcing the deal, Dalata’s construction development director Shane Casserly said: “Acquiring a new hotel asset in London, in challenging funding markets, that will be operational in the summer of 2023, is a fantastic achievement. … This transaction highlights our appetite for growth as well as the flexibility of our business model, which enables us to grow through acquisition, development and leasing.”
3. Host, Hyatt, Wyndham Post Earnings Results
Host Hotels & Resorts, Hyatt Hotels Corp., and Wyndham Hotels & Resorts are the latest hotel companies to post fourth-quarter and full-year 2022 earnings results.
Host reported a 26.6% jump in revenues for the fourth quarter compared to 2021, up to $1.26 billion, but performance still lags the final quarter of 2019 — down 5.3%. The company posted net income of $149 million in the final quarter and $643 million for full-year 2022.
Hyatt announced significant jumps in revenue per available room for both the fourth quarter — up 34.8% year over year — and the full year — up 60.2%. The company saw net income of $294 million for the quarter and $455 million for the year.
Wyndham similarly enjoyed a strong quarter with global RevPAR up 15% year over year on a constant-currency basis and up 20% for the full year. Both domestic and global RevPAR have surpassed pre-pandemic levels for the company.
4. Rates Push Up Hotel Revenues
A 13.4% rate increase over pre-pandemic levels was enough to push up hotel revenues even as demand lagged for the week ending Feb. 11, according to the latest data from CoStar's hospitality analytics firm STR.
Average daily rate was reached $150.97 for the week, while occupancy was down 8.7% from the comparable week in 2019 to 57.8%. Revenue per available room increased 3.6% to $87.21.
Unsurprisingly, Super Bowl host city Phoenix came in as the top market performer for the week, with a 114.3% increase in RevPAR, which jumped to $300.09.
5. Resort Fees Once Again Derided as 'Junk Fees'
In just the latest sign that the public perception of hotel resort fees is decidedly negative as government officials continue to brand them as "junk fees," The Wall Street Journal has published a guide on how travelers can best avoid them.
Consumer advocacy groups are now asserting resort fees should be viewed as illegal in many instances.
"Lauren Wolfe is a lawyer with Travelers United, a consumer-advocacy group, and founder of the website Kill Resort Fees. She maintains that resort fees are illegal under various consumer-protection laws and that travelers should only pay the advertised room rate," the newspaper reported. "Hotels have faced legal challenges from states about pricing practices and resort-fee disclosures."