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Briefs: CBRE updates US outlook; Gulf Coast secures 2 MainStay Suites

US hotel recovery outlook: Despite the downward pressure on economic growth, hotel recovery has been continuing. Consumers, however, are feeling the pinch of the inflation and hotels are struggling to meet the increased labor costs and supply chain issues, revealed the ‘U.S. Hotels State of the Union’ report by CBRE. Since the start of the pandemic, hotel wages have been growing at twice the rate of the U.S. overall and 43% faster than hourly retail wages. March trends have been improving in all chain scales, while April weekly data showed these gains have stayed strong. Although hotel-specific leading indicators showed no signs of decline, macroeconomic leading indicators suggested there could be challenges going forward. International arrivals have returned from most of the Top 10 markets, except South Korea, China and Japan. While East Coast gateway markets continued to strengthen, West Coast Asia-dependent markets still lagged. Operating revenues have showed signs of near recovery to earlier peaks. However, the reopening of lower margins amenities and inflationary pressures have caused GOP to lag.

Gulf Coast secures 2 MainStay agreements: Choice Hotels International has awarded two MainStay Suites franchise agreements to multi-unit developer and longtime Choice franchisee Topeka, Kansas-based Gulf Coast Hotel Management. The recent signings add to Gulf Coast’s portfolio of extended-stay properties, which total 39. The two converted hotels are located in Wichita, Kansas, and Overland Park, Kansas.

MainStay Suites in Overland Park, Kansas

Italy market hotel insight: Italy has managed to gain a position in the ranking of hotel arrivals, going from the fourth place in 2019 to the third place in 2020 (after Germany and France, and overtaking Spain with about 3 million additional arrivals), revealed the ‘Italy Hotels & Chains Report 2022’ by Horwath HTL. While 2021 showed the initial signs of recovery for the hotel industry in Italy, it also highlighted the first pandemic impacts — the Italian overall supply fell by 528 hotels as branded hotels lost three properties. However, there was a slight increase in chain penetration (5.4%). Domestic branded hotels registered a stronger loss than international properties, accounting for -15 and +26 properties, respectively. In 2021, 15,507 keys were added to the database, of which 72% of the new keys belonged to the upscale tier, 14% to the upper upscale and luxury market, 13% to the midscale sector and 0.2% to the economy segment. Eight new hotel brands have entered the market, driven by international operators. Sun and beach destinations saw an increase of international brand supply. By the end of 2024, 21,450 more rooms are expected to open, of which 50% will be in the upscale tier.

Outbound tourism from South Korea to rise: Outbound tourism from South Korea is set to flourish as the country has eased some of its travel restrictions, found a latest study by GlobalData. The data revealed outbound tourism in South Korea plummeted 80.6% YOY from 2019 to 2020 to only 5.6 million international departures. In 2019, South Korea was the third largest outbound tourism source market in the Asia Pacific region with 28.7 million international departures. The South Korean source market is anticipated to be highly sought after as nearby source markets, like Japan and China, have yet to make a complete return to international travel. South Korean tourists have usually preferred nearby Asia Pacific countries and figures show that travelers are increasingly traveling abroad and showing interest in European destinations. The U.K., France and Italy are likely to see the highest growth in terms of South Korean tourists as measured by CAGR between 2022 and 2025. South Korea tourists show significant interest in gastronomy tourism and as per a previous GlobalData survey.

Swiss-Belhotel to expand in Asia: Swiss-Belhotel International, Hong Kong, will expand its portfolio in Asia through a joint venture with Odyssey Asset Management. Both the companies will work to identify opportunities in Japan and other countries. The company said there was a demand from owners and developers of existing builders in Japan to partner with international hotel groups to leverage the quality of their brand. Swiss-Belhotel is planning to double the number of hotels under management to 300 by 2025. The group currently has 125 hotels and projects across 19 countries.

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