U.S. occupancy reaches 20-week high: U.S. weekly hotel occupancy reached a 20-week high, according to STR’s latest data through March 6. February 28 through March 6 (percentage change from comparable week in 2020):
Occupancy: 49.0% (-20.5%)
ADR: US$98.30 (-21.9%)
RevPAR: US$48.13 (-37.9%)
While demand has improved in in many states, most markets remain deep in recessionary territory when indexed to 2019 levels. Year-over-year comparisons with 2020 are beginning to turn favorable as the country hits the one-year anniversary of its earliest pandemic restrictions. Additional insights on the week’s performance can be found via STR’s Market Recovery Monitor.
Aggregate data for the top 25 markets showed slightly lower occupancy (46.7%) but higher ADR (US$105.55) than all other markets. Among the top 25 markets, Miami saw the highest occupancy level (66.6%). Top 25 markets with the lowest occupancy levels for the week included Oahu Island (30.9%) and Boston (31.7%).
China issues vaccine passport: China has issued what is thought to be the world’s first COVID-19 vaccine passport, which will allow residents to enter and leave the country. The Chinese health passports include information on a person’s vaccination status, as well as recent coronavirus test results. The passports are available for Chinese citizens to download on social media platform WeChat, and can be used by travelers to enter and leave the country. They are being hailed as the world’s virus passports, although similar schemes are being planned in the UK, U.S. and in Europe.
Restructuring for Queensgate: To ensure an appropriate capital base to address operational and earnings dislocation, U.K.-based Queensgate Investments has completed a €500 million (US$595 million) debt restructuring of its Generator Group hybrid hotel/hostel business. Funds managed by Apollo Global Management provided nearly €100 million (US$119 million) in secured additional financing in support of the restructuring. Generator consists of 19 hotels with 3,194 rooms across 17 cities and 10 countries. Exactly 17 of the 19 hotels are fully owned.
Westin Cleveland Downtown may close: A lender seeking to foreclose on the Westin Cleveland Downtown in Cleveland, Ohio, said the owner’s financial woes would lead to the hotel’s closure by next week unless a judge steps in and appoints a receiver. Currently, Westin owner Optima 777 either cannot or is unwilling to pay to continue to operate the hotel. Optima 777 is a subsidiary of Optima Ventures of Miami, which is under legal scrutiny as FBI agents probe whether those involved in the company used it as a vehicle to launder money for Ukrainian oligarchs.
Hyatt’s global owners’ group: Hyatt Hotels Corp. has launched a new Global Franchise and Owner Relations organization aimed in part at supporting accelerated franchise growth. In close consultation with its hotel owners and operators, Hyatt’s effort is intended to expand the franchise portfolio and increase property performance by further elevating the company’s guest and customer personalization strategy. The group will be led by Hyatt veteran Jim Chu.
Asia Pacific tourism suffers: According to a new Asia Pacific market report from CBRE, Asia Pacific recorded the largest decline in international tourist arrivals of any region in 2020. The number of visitors fell 84% year-over-year, largely due to travel restrictions enforced since March 2020. Other highlights from the report include:
• The near total shutdown in international travel during 2020 led to sharp falls in Asia Pacific hotel occupancy and ADR. Regional occupancy declined to 44.7%, while ADR fell by 24.5% year-over-year, to US$74.51. RevPAR stood at US$34 in 2020, representing a drop of 50.4% year-over-year
• The gradual rollout of vaccines is expected to restore some confidence in traveling and lead to the gradual easing of travel restrictions in 2021, although the outlook remains opaque. Governments and industry players continue to implement various policies and partnerships to revive the travel and tourism industries
Melbourne performance down: Amid tightened restrictions, Melbourne’s hotel industry reported lower performance levels compared with previous months, according to preliminary February 2021 data from STR. Year-over-year declines remained significant in comparison with February 2020:
Occupancy: 36.3% (-54.2%)
ADR: AUD144.75 (US$112) (-22.9%)
RevPAR: AUD52.57 (US$41) (-64.7%)
Each of the three key performance metrics were the lowest in the market since November 2020. Performance levels were affected by tightened restrictions across Victoria, despite the rescheduled Australian Open tennis tournament taking place in February. Much of the event was played in front of no crowds, and the state returned to “COVIDSafe” settings on February 26, allowing travel within Victoria. Occupancy on the books as of March 1 shows Melbourne at 23% for the next 90 days with pickup expected to increase as vaccinations roll out and state borders remain open.
United Airlines chief bullish on business travel: It is a mistake to believe that business travel demand will be fundamentally altered by the COVID-19 pandemic, even if its recovery will lag the return of leisure markets, according to United Airlines Chief Executive Scott Kirby. Acknowledging that his view “is not the consensus” and that “almost everyone disagrees,” Kirby stated during a live event Wednesday that predictions regarding the death of business travel are likely to be proven wrong, and that it will ultimately return.
France to ease UK travel restrictions: France will ease its COVID-19 border restrictions for several countries, including the UK, but travelers will still need to have a negative test before arriving. The foreign ministry said those flying to or from Australia, South Korea, Israel, Japan, New Zealand, the UK and Singapore will no longer need to have a compelling reason to travel. All other restrictions, including the requirement for a negative test less than 72 hours before travel, would remain in place, the ministry said, adding a decree was due to be published on Friday.
MGM faces lawsuit over resort fees: MGM Resorts International is facing a lawsuit over its use of resort fees. Travelers United, a nonprofit travel advocacy group, has filed a lawsuit against the Las Vegas-based casino operator accusing the company of charging “deceptive” resort fees in violation of the District of Columbia’s Consumer Protection Procedures Act. MGM operates the MGM National Harbor in Forest Heights, Maryland, a short drive away from the district. The lawsuit, filed last month, argues that advertising without including mandatory fees is false advertising. Travelers United accuses MGM of reaping hundreds of millions of dollars over the last decade through “drip pricing,” in which a portion of the daily rate from customers is hidden via resort fees. Spokespeople for MGM declined to comment.
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AJ Capital launching golf brand: Chicago-based AJ Capital Partners, which is behind the Graduate Hotels collection, is launching a new brand centered around golf. “Marine & Lawn” will kick off this summer with the opening of the first of three new Scottish properties: the Rusacks St Andrews — a boutique hotel overlooking the 18th hole of the Old Course at St Andrews, which AJ Capital acquired in 2019. The company has also acquired two more similarly sized Scottish hotels also near some of the world’s best courses: The Marine Hotel offers views of the 1st and 18th fairways of Royal Troon’s Old Course, which has played host to nine Open Championships, and the Marine North Berwick, looks out at the 16th hole of the West Links at North Berwick Golf Club.
CISO priorities for 2021: Up to 50% of information security budgets are being spent on the tools needed to fortify defenses, automate processes, or transition to the cloud, according to a new report from Retail & Hospitality ISAC. Between 31-40% of chief information security officer’s budgets is being invested in the personnel responsible for operating those technologies ,while less than 30% is dedicated to third-party services that extend capabilities that cannot be achieved in-house. Considering this context, CISOs are focusing their 2021 efforts in three key areas: security architecture, security operations and risk management.
San Diego hotel sells for third time: The downtown Courtyard by Marriott San Diego, which began life in the 1920s as a bank, has been sold for US$64.5 million to Pimco, a global investment management firm headquartered in Newport Beach, California. The purchase price is US$6.5 million less than what the 245-room hotel previously sold for in 2013, when Philadelphia-based Hersha purchased it for US$71 million from its then owner, Wheelock Street Capital. Wheelock bought the hotel in 2011 for US$61.1 million.
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Florida’s first MGallery property: The Berkeley Park Hotel in Miami will open on April 1 as a new member of Accor’s MGallery Hotel Collection, and the first MGallery property in Florida. A boutique hotel, the 80-room property recently underwent an US$18 million renovation.