COVID 19: Soneva’s return guidelines | US rebound?

Citigroup revives US$435M hotel deal shelved during pandemic

Citigroup is bringing back a previously planned US$435 million hotel-property securitization that was tabled after the coronavirus outbreak hit U.S. capital markets in February. According to ratings agency presale reports, the bank and Brookfield Asset Management are once again marketing Citigroup Commercial Mortgage Trust 2020-WSS, a single-borrower commercial mortgage securitization backed by a portfolio of 74 low-cost, extended-stay WoodSpring Suites hotels. Brookfield’s real estate fund holds leasehold interests in the hotels franchised from Choice Hotels International.

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Omni Hotels takes in up to US$84M in federal loans

A Dallas billionaire who owns Omni Hotels & Resorts received small business relief loans of up to US$84 million for his holding company and 15 hotels. The forgivable loans to Robert Rowling’s TRT Holdings and Omni hotels in 12 states were detailed in data released this week. The data provided only a range for loan amounts, meaning Rowling’s companies received anywhere from US$36 million up to US$84 million. Omni’s business was “drastically impacted” by the pandemic, the company said in a statement. Before COVID-19, its hotels were 70% full but now some are operating with single-digit occupancy and some remain closed.

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Africa’s hotel development process

While the COVID-19 crisis is currently hitting operational hotels hard, the situation for hotel projects under development on the African Continent has not been addressed, according to analysis from Horwath HTL. It should be expected that dossiers for hotel projects will need to be more robust than ever before when being presented to investors and banks. In this article, Horwath looks at a return to the fundamentals of hotel development and a reminder of the major stages in the development of a project.

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Soneva’s new guidelines

Bangkok-based resort operator Soneva, is ready to welcome back guests from around the world, implementing a “new normal” at its single-resort islands. Even more, Visit Maldives announced its borders will reopen to international travelers on July 15, 2020. Soneva unveiled its new guidelines, processes and procedures in the wake of COVID-19 with a video, “The New Normal: Soneva’s Response to COVID-19.”

Watch the video

U.S. rebound potential

The U.S. hotel industry has poised a remarkable rebound since mid-April, according to data from CBRE. The company’s latest “Hotel ViewPoint” report provides a summary of the current outlook and how the industry is tracking relative to forecasts released in May. Hightlights include: 

•   The U.S. hotel industry has seen 10 consecutive weeks of occupancy gains, but a recent uptick in COVID-19 cases threatens to derail those gains

•   Over the previous six weeks, demand has outpaced near-term expectations but doesn’t change long-term outlook for a full recovery in hotel occupancy

•   CBRE forecasts show that RevPAR will decline 52% this year, and occupancies will average just 41% — well below last year’s record of 66%

•   Given the expected quick rebound in economic growth and historic resiliency of travel demand, CBRE forecasts a strong hotel revenue recovery in 2021 and 2022, and that RevPAR could recover to pre-recession levels by mid-2023

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Slight decline in U.S. occupancy

U.S. hotel performance data for the week ending July 4 showed a slight decline in occupancy from the previous week, according to STR.

June 28 through July 4 (percentage change from comparable week in 2019):

Occupancy: 45.6% (-30.2%)

ADR: US$101.36 (-20.9%)

RevPAR: US$46.21 (-44.8%)

Occupancy had risen in week-to-week comparisons for 11 straight weeks since mid-April.

Hotel design in the COVID-19 era

In this article from design firm Leo A Daly, the group reimagines the hotel guest’s journey, exploring strategies for maximizing health and wellness without sacrificing the warmth and luxury guests have come to expect. As the hospitality industry struggles to cope with a historic downturn resulting from the COVID-19 pandemic, hoteliers and designers are considering how they can create new properties and reimagine existing ones to support the safety and well-being of guests.

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