Host buys Savannah boutique: Host Hotels & Resorts has acquired the fee simple interest in The Alida, Savannah, a 173-room boutique hotel, for approximately US$103 million in cash. This newly constructed hotel opened in October 2018 and is branded under Marriott’s Tribute Portfolio. Stabilization for The Alida is expected in the 2024-2025 timeframe at approximately 11-12x EBITDA with RevPAR of approximately US$240. Host expects growth to be buoyed by multiple leisure demand drivers, including the fact that Savannah is a drive-to leisure destination for feeder markets in the Southeast and increasing air traffic through the Savannah/Hilton Head International Airport. The hotel also benefits from both in-house and out-of-house group demand, which are likely to be bolstered by the US$271 million convention center expansion expected to be completed in 2024.
W Hotels in Macau: Melco Resorts & Entertainment, Hong Kong, has entered into a strategic partnership with Marriott International to introduce the W Hotels Worldwide brand to Studio City Phase 2, the cinematically-themed entertainment and leisure destination in Macau. Slated to open together with Studio City Phase 2 in December 2022, W Macau – Studio City will feature 557 guestrooms, including 127 suites and wellness facilities, spa, fitness center and indoor swimming pool. Studio City will feature one of Asia’s largest indoor and outdoor water parks, a six-screen cineplex, residency shows and MICE space.
Black Bear acquiring HGI in Colorado: Black Bear Capital Partners (BBCP), the real estate financial advisory firm of Black Bear Asset Management, has arranged US$22.9 million in financing to purchase the 157-room Hilton Garden Inn hotel at Denver Airport in Aurora, Colorado. The three-year floating-rate loan has only 36-month interest payments, representing 75% LTV. Atlanta-based Stonehill was the lender.
Union Square Hospitality mandates boosters: Union Square Hospitality Group, New York City, said all its customers will have to show proof of receiving a COVID booster shot to dine indoors at its restaurants from next year. The company’s existing and new employees will also be required to receive a booster dose, effective immediately, said CEO Danny Meyer. Meyer is also mulling COVID testing as part of its precautions to help ensure his employees and diners’ safety. In July, Union Square Hospitality Group said all customers dining or drinking indoors, along with existing and new employees, were required to be fully vaccinated. Last week, Meyer said 100% of his employees were fully vaccinated. The company’s restaurants include Gramercy Tavern, Union Square Café and Manhatta in New York City. It also operates Anchovy Social in Washington. D.C.
Minor sells shares in 5 assets: Minor International and Abu Dhabi Fund for Development (ADFD) have announced a deal to jointly hold shares in four resorts and a plaza mall in Thailand: Anantara Riverside Bangkok Resort, Avani+ Riverside Bangkok Hotel, Riverside Plaza Bangkok, Anantara Layan Phuket Resort and Four Seasons Resort Koh Samui. The shareholding structure of the joint venture will be 60% held by Minor and 40% by ADFD. ADFD will purchase 40% stakes in Minor’s interest of each asset at the aggregate selling price of US$104.8 million (approximately THB 3.5 billion), implying 12.5x to 2019 EBITDA on an overall basis. The net proceeds from the sale by Minor are primarily intended for deleveraging and strengthening of its balance sheet position. These five assets will continue to be operated under the existing brands and under the control of Minor.
Sébastien Bazin resigns as Huazhu director: Huazhu Group Ltd., Shanghai, announced that Sébastien Bazin has resigned as the company’s director effective immediately. Upon his resignation, Gaurav Bhushan has also ceased to be an alternate director to Bazin. The company’s board of directors now consists of seven directors — Qi Ji, Shangzhi Zhang, John Jiong Wu, Tong Tong Zhao, Jian Shang, Lei Cao and Theng Fong Hee. Huazhu currently operates 7,466 hotels with 722,983 rooms in 17 countries.
London performance finally encouraging: The recovery of the London hotel sector steadily continued throughout October with occupancy rising 2.6% to 48.2%, according to research from consultancy Knight Frank. Data shows steady gains in occupancy with month-on-month profitability improving by 37%, marking the highest profitability levels London has achieved since the outbreak of coronavirus in early 2020. October showed London’s luxury hotels outperforming the market, recording a 22.7% increase in RevPAR and gross operating profit per available room increasing by 23%. Wider hotel demand was boosted by an uplift in overseas visitors, which supported the ability of London hotels to withstand the 7.5% increase in VAT, with average daily rent for the London-wide market recording 6.6% growth in October – rising to £193 (US$256).
UK announces £1 billion fund: British Chancellor of the Exchequer Rishi Sunak has announced a £1 billion (US$1.32 billion) fund to aid businesses impacted by the surge in COVID cases, including the hospitality and leisure sector, and an additional £30 million (US$39.71 million) to help theatres and museums. Hospitality businesses, like pubs and restaurants, can apply for cash grants of up to £6,000 (US$7,934) per premises. The government will also help companies with less than 250 employees with the cost of sick pay for COVID-related absences. Many hotels have been reporting a wave of cancelations over the fear of the Omicron variant of the virus. Meanwhile, some business owners have requested clarity on the COVID situation from the government, rather than financial assistance.
UK reduces self-isolation duration: Self-isolation of COVID patients in the U.K. has been reduced to seven days from 10 days if they test negative twice. They can now end quarantine after seven days by providing negative lateral flows reports on day six and seven. The decision will minimize disruption caused by the quick spread of Omicron variant cases, said Health Secretary Sajid Javid. The move comes after Prime Minister Boris Johnson reassured that no new restrictions would be implemented in the country before Christmas Day. The new norm is applicable to everyone regardless of their vaccination status. However, people should not end their isolation early if they still experience COVID symptoms. People who are not fully vaccinated and have come in close contact with a COVID patient will continue to isolate for 10 days.
Macau numbers look good for holidays: Hotel occupancy in Macau is expected to reach 70% to 80% during the holiday season due to a lineup of big events at the end of December that will attract tourists from the mainland into the city, according to predictions by the Macau Hoteliers & Innkeepers Association. The situation, however, depends on the effects of the pandemic in the city and across the border. Average hotel occupancy has fluctuated between 60% and 70% without any significant surge, although the number of visitors has been increasing recently. The average daily tourist volume still remains below 30,000, with many being single-day visitors. The situation of domestic tourism still remains uncertain due to new COVID cases in Mainland China and tentative customs entry schedules and quotas between Hong Kong and Macau.