Hyatt execs who took cut stand to gain big
Hyatt Hotels Corp. decided to furlough many of its hotel workers in mid-March, and at the time, told employees that CEO Mark Hoplamazian and Chairman Thomas Pritzker would forgo salaries and nine other senior leaders would take a 50% pay cut through May. However, the executives also received their annual shares and stock options. If Hyatt’s share price bounces back near levels it was before the coronavirus pandemic, those 11 executives stand to gain tens of millions of dollars through those awards, according to a Wall Street Journal analysis of the company’s March 26 securities filings.
Read more at the Wall Street Journal
US$265M deal drops. Is COVID-19 to blame?
The coronavirus is being blamed for a US$265 million hotel deal falling apart, with the New York-based Blackstone Group suing the former buyer. Six limited liability companies that trace back to Blackstone Real Estate Advisors, an affiliate of the mammoth New York City-headquartered company, filed a recent lawsuit against Arcadia, New York-based KS Development after the real estate investment firm terminated a deal to buy nine hotels across California. The lawsuit says that there was nothing in KS Development’s contract affording the buyer to abandon the deal due to an economic downturn.
NYC to rent ‘thousands’ of hotel rooms
New York City Mayor Bill de Blasio said the city’s hotels will be rented en masse by the city and turned into hospitals to ease the burden on health care facilities overwhelmed by coronavirus. The city, state and federal government are working on renting rooms, and in some cases, leasing entire hotels, to provide non-intensive care for COVID patients and others, de Blasio said.
Read more at the New York Daily News
Lack of consumer spending threatens global travel
A global pandemic will reduce both the ability and willingness to travel, severely affecting consumer spending for 2020. Ultimately, all companies are at risk amid the outbreak of the coronavirus (COVID-19), from the traditional in-store travel agency to the leading OTA, as financial performance is entirely dependent on the direct spending of consumers, says data and analytics company GlobalData. According to the company’s latest figures, US$166 billion was spent on travel intermediation in 2019, which is equivalent to 8.7% of global expenditure. More was spent on transportation (US$472 billion), retail (US$461 billion) and accommodation (US$325 billion), but lack of expenditure across these sectors will have a roundhouse effect on travel intermediaries.
Why loyalty counts now
Loyalty programs create value for their customer base and increase demand during and after the coronavirus (COVID-19) pandemic, according to Ralph Hollister of global consultancy GlobalData. “Instead of advertising future room rates at discounted prices, offering perks through loyalty schemes means that hotels can protect their pricing and margin strategies,” he said. “Providing added value instead of price reductions such as offering reward extensions, as Hilton have done, or following IHG’s lead and lowering the entry requirements for their next loyalty tier, should lead to more customer loyalty. Some companies such as Kempinski Hotels are granting bonus nights to loyal customers if their stays were interrupted by COVID-19.”
Ovolo offerings proceed with caution
Australia- and Hong Kong-focused Ovolo Hotels has taken the following precautions during the spread of coronavirus: Social hour is delivered to rooms via a new “Social Hour Trolley Service”; it’s allowing guests to book extended-stay seven- and 14-day packages; and it’s offering takeaway menus for several restaurants including the Za Za Ta (Brisbane), Alibi (Sydney) and Monster (Canberra).
Elsewhere
Potential Marriott breach: Marriott International is notifying some of its guests of an incident involving a property system at the end of February. At that time, the company identified that an unexpected amount of guest information may have been accessed using the login credentials of two employees at a franchise property. Although Marriott’s investigation is ongoing, the company said it has no reason to believe that the information involved included Marriott Bonvoy account passwords or PINs, payment card information, passport information, national IDs, or driver’s license numbers. At this point, the company believes that up to approximately 5.2 million guests’ information may be involved.
New Radisson Blu: The Radisson Blu Hotel Nanjing South New Town in China is now under development. The property will be part of a large complex with a high-end shopping mall and an office tower. Scheduled to open its doors in 2024, the 300-room conference venue is being developed by Nanjing South New Town Exhibition Centre Development Co. Ltd.