Briefs: KSA launches own boutique brand; Minor Hotels signs in Qatar

Saudi Crown Prince launches brand: Mohammed bin Salman, the Saudi Crown Prince and chairman of the Public Investment Fund, has launched the Boutique Group, a brand that will convert and manage a collection of iconic historic palaces in Saudi Arabia into uber luxury boutique hotels. The initial phase of the project will focus on developing three palaces in collaboration with the private sector. This includes the Al Hamra Palace in Jeddah (77 rooms, including 33 luxury palace suites and 44 luxury villas); Tuwaiq Palace in Riyadh (96 rooms, including 40 luxury palace suites and 56 luxury villas); and Red Palace in Riyadh (46 suites and 25 rooms).

Marriott adds record rooms, properties in 2021: Marriott International closed 2021 with a global development pipeline of around 485,000 rooms. At the end of the year, Marriott’s global system comprised roughly 8,000 properties and around 1.48 million rooms across 139 countries and territories. The company signed 599 agreements throughout the year, representing around 92,000 rooms of which marginally more than half are located outside of Canada and the U.S. It said rooms falling out of the pipeline were at historically low levels. Marriott added more than 86,000 rooms (3.9%) on a growing basis in 2021, including deletions of 2.1%. The deletion rate was 1.2% when excluding the exit of 88 Service Properties Trust select-service hotels.

TRSDC closes big loan: The Red Sea Development Co. has closed on its SAR 14.120 billion (US$3.76 billion) term loan facility and revolving credit facility with four leading Saudi banks. As announced previously, the banks are Banque Saudi Fransi, Riyad Bank, and Saudi British Bank, with Saudi National Bank acting as Mandated Lead Arrangers. “With our capital structure fully in place we’ll continue to focus on execution and delivery of the project, which remains on schedule to welcome our first guests by the end of this year. We’re grateful to our banking partners for their support,” said John Pagano. CEO, The Red Sea Development Co. and AMAALA.

Rendering of NH Collection Doha Oasis Hotel & Beach Club

Minor Hotels signs in Qatar: Minor Hotels, Bangkok, has signed a new property in Doha, Qatar. The 300-room NH Collection Doha Oasis Hotel & Beach Club, which is in the later stages of development, will open later this year and will be the first NH Collection property globally to have a beach club. The hotel is coming up in the same location as Oasis Hotel, Doha’s first ever hotel when it opened in the 1950s. The hotel will include more than 50 suites, with the Royal Duplex Suite being the largest with 332 square meter of space, and six restaurants and bars, including two specialty restaurants and a rooftop bar.

Hyatt grows footprint in the UK: Hyatt Hotels Corp. announced that its affiliate has entered into management agreements with Stratford City Hotels Ltd., a wholly owned subsidiary of M&L Hospitality, for the 225-key Hyatt Regency London Stratford and 127-key Hyatt House London Stratford. Following refurbishments, both the hotels are expected to open in Q2 2022. In 2019, Hyatt and M&L Hospitality partnered for the openings of Hyatt Regency Manchester and Hyatt House Manchester.

US RevPAR recovers 83%: As performance improved in 2021, the U.S. hotel RevPAR recovered 83.2% compared to the pre-pandemic comparable, according to the latest data from STR.

2021 (percentage change from 2019):

  • Occupancy: 57.6% (-12.6%)
  • ADR: US$124.67 (-4.8%)
  • RevPAR: US$71.87 (-16.8%)

In addition to 2020, U.S. hotel occupancy failed to reach 60% for the second time since 2011. On a nominal basis, 2021 ADR was the fourth highest on record. The country’s RevPAR level was its second lowest in eight years behind only 2020.   Among the Top 25 Markets, Tampa saw the highest occupancy level (68.4%), which was still down 5.2% from the market’s 2019 benchmark. None of the Top 25 markets reported increased occupancy over 2019. Markets with the lowest occupancy for the year included Minneapolis (44.4%) and San Francisco/San Mateo (47.7%). Miami recorded the largest ADR increase over 2019 (+14.7% to US$223.49), while Norfolk/Virginia Beach saw the highest growth in RevPAR (+7.7% to US$72.31). The steepest RevPAR deficits were in San Francisco/San Mateo (-64.2% to US$72.97) and Washington, D.C. (-48.9% to US$57.86). In aggregate, the Top 25 markets showed lower occupancy but higher ADR than all other markets.

US weekly performance falls: Weekly occupancy in the U.S. worsened as compared to the pre-pandemic levels, according to STR’s latest data through January 15.

  • Occupancy: 48.8% (-16.3%)
  • ADR: US$122.12 (-1.6%)
  • RevPAR: US$59.57 (-17.6%)

On an absolute basis, occupancy was higher than the previous week, but the gap to 2019 levels widened, pointing to a bigger impact from Omicron. ADR and RevPAR were up week over week and when indexed to 2019. Although none of the Top 25 markets registered increased occupancy over 2019, Norfolk/Virginia Beach came closest to its pre-pandemic comparable (-8.4% to 44.1%). San Francisco/San Mateo saw the largest occupancy decrease from 2019 (-53.9% to 37.3%). Miami recorded the largest ADR increase (+16.6% to US$271.21). The steepest RevPAR deficits were in San Francisco/San Mateo (-69.6% to US$58.84) and New York City (-53.9% to US$68.93).

Chinese New Year travel outlook: The recent lockdowns in China have caused concern for Chinese New Year travel plans. According to latest data from ForwardKeys, as of January 11, flight bookings for the upcoming holiday period (January 24 to February 13) were 75.3% below pre-pandemic levels but 5.9% ahead of last year’s levels. The Chinese government, while not enforcing as strict travel advisories as last year, has asked people to protect their personal health while traveling and not advised them to “stay put.” This gives some hope for the airline industry as last-minute surge is still possible. Leisure travel is expected to lead recovery, with the most resilient destinations being Changchun, reaching 39% of pre-pandemic levels; Sanya, 34%; Shenyang, 32%; Chengdu, 30%; Haikou, 30%; Chongqing, 29%; Shanghai, 26%; Wuhan, 24%; Harbin 24% and Nanjing, 20%.

First ibis Styles in Czech Republic: Accor announced the signing of a franchise agreement with JR Management – Hotel, s.r.o. for the first ibis Styles in Rožnov pod Radhoštěm, Czech Republic. The existing Relax Hotel will be rebranded as an 88-room ibis Styles Hotel Relax Rožnov pod Radhoštěm and open in December 2023. Currently, there are 550 hotels operating under ibis Styles.

Thailand resumes Test & Go policy: Thailand will resume the Test & Go quarantine waiver for vaccinated travelers from February 1, as COVID-19 cases decrease in the country. The program was suspended last month after the rapid spread of the Omicron variant. The Sandbox program has also been expanded to include Pattaya and Koh Chang. The Test & Go policy, launched in November 2021, allows travelers to test for COVID upon arrival and again five days later. Travelers were mandated to isolate at a hotel while waiting for their test results and download a tracking app to allow authorities to track their movements. Meanwhile, hoteliers in Thailand are seeking the extension of the 90% reduction of land and building taxes for two more years, or collect a new levy of 20% to 30% as tourism has been severely impacted. In June 2020, the government offered a 90% discount on land and buildings taxes. Hotel associations are urging the government to put off the new tax rates until tourism improves as operators have lost almost 90% of revenue from 2019 levels.

Business travel outlook remains strong: Despite getting impacted by new variants of COVID, government restrictions and inconsistencies in international policies, there are positive signs for the global business travel industry, according to the latest poll from the Global Business Travel Association (GBTA). According to the poll, three in four travel managers expect business travel volume at their company will be much (17%) or somewhat (58%) higher in 2022 than it was in 2021. About 68% of GBTA member companies have not yet opened international travel, compared to 79% in the October 2021 GBTA poll, and 29% have not opened domestic business travel versus 38% in October. When asked to compare Omicron and Delta variant concerns, 43% report they are either less worried about Omicron compared to Delta and 45% are equally concerned. When asked to name the single greatest barrier to business travel, 43% of survey respondents cited government policies that restrict travel or make it difficult (like entry restrictions, mandatory quarantines).

Davidson acquires Davenport Hotels: Davidson Hospitality Group announced the addition of Davenport Hotels to its Pivot lifestyle portfolio. Comprising five luxury, convention, business and leisure hotels in Spokane, Washington (The Historic Davenport, The Davenport Tower, The Davenport Lusso, The Centennial and The Davenport Grand Hotel), Davenport Hotels was established by Walt and Karen Worthy with more than 20 years of ownership. Pivot, in partnership with KSL and Davenport Hotels Managing Director Lynnelle Caudill and her team, will continue to preserve the history and heritage of the hotels. The five hotels together total 1,787 rooms, 10 restaurants and lounges and roughly 130,000 square feet of meeting space. The Historic Davenport was known as the most modern hotel in the U.S. when it opened in 1914. It closed in 1985 and narrowly escaped demolition. It was purchased 17 years later by the Worthys and reopened in 2002 following renovations.

Starhotels Collezione adds to portfolio: Starhotels Collezione, Florence, added Hotel Gabrielli in Venice to its luxury hotels portfolio. The historic, waterfront hotel has been owned and managed by the Perkhofer family since it opened in 1856. Starhotels Collezione has entered into a management agreement with the Perkhofer family and a €20 million (US$22.67 million) restoration project is underway. The hotel will reopen as a 5-star landmark in summer 2023. Featuring 69 rooms and suites and seven serviced apartments, the hotel spans three historic buildings with a 14th century Venetian-style façade. Currently, Starhotels Collezione has properties in London, Paris, Milan, Rome, Florence, Venice, Siena, Trieste, Saturnia and Vicenza.

Georgetown Co., First Hospitality acquire Hutton: The Georgetown Co., New York City, has acquired the 250-room Hutton Hotel in Nashville, Tennessee. The all-cash purchase of the property was the first through the US$1 billion hospitality investment platform that was launched in 2021 by Georgetown in partnership with First Hospitality. The name of the seller and price paid was not disclosed. The hotel marks Georgetown’s first property in the Nashville market and it will be investing additional capital for upgrades. The hotel, on-site restaurant and live-music venue will be managed by First Hospitality.

Destination by Hyatt debuts in Asia Pacific: Hyatt’s Destination by Hyatt brand will debut in Asia Pacific with two properties in Mainland China. The brand will launch a hotel amid the mountains of  Qingchengshan in Sichuan Province, which will be followed by a beachfront hotel in Dalian, Liaoning Province. Slated to transition to the Destination by Hyatt brand later this year, the 231-key Grand Resort Qingchengshan is located at the edge of Mount Qingcheng, near the Qingchengshan-Dujiangyan National Park. Scheduled to open in 2026, the hotel in Dalian will be owned and developed by Dalian Kaiyueda Resort Hotel Development Co. as part of a mixed-use development featuring residential, retail, wellbeing and international medical facilities. The hotel will feature an “ocean spring,” a natural source of freshwater hot spring from the ocean floor sought after for its therapeutic benefits.

Amro Partners acquires Croydon Park Hotel: Amro Partners, London, in partnership with Flemyn LLP, has acquired Croydon Park Hotel in south London and will be transformed into a new £200 million (US$272.29 million) GDV Build to Rent development. The project will deliver 600 units, including shared amenities like lounge areas, roof terraces, co-working spaces, gym and a cinema room. Construction for the project is slated to begin in spring 2023 and it will open in 2025. The project, focusing on being a net zero carbon asset, will be managed by Amro Living.

Labor dynamics top list of concerns: Labor dynamics has emerged as the top concern for the hotel industry, as per the latest internal survey by the Hospitality Asset Managers Association (HAMA). The top five concerns of 2022 by HAMA membership are availability of labor, labor wage rates, return of corporate travel, general inflation and market demand. “In terms of labor availability, job vacancy stats are improving when compared to mid-2020, indicating the crisis is easing, but the industry needs to focus on the reputation of jobs in the hospitality industry as we attempt to regain all the positions lost during the pandemic. Members also believe the worst is behind us with regards to wage rate increases,” said Matthew Arrants, CHAM, HAMA president, The Arrants Company principal.

Promising 2022 travel outlook: The tourism industry will need to cater to those ready to start traveling again, while adjusting long-term strategies to accommodate more permanent shifts in consumer demand, according to Deloitte’s 2022 Travel Outlook. The report projected a slow return to business travel, but an increase in “laptop lugging” leisure travelers who are benefitting from remote work and taking more and longer trips with increased budgets. Private rentals have gone mainstream, as the interest in alternative accommodations keeps increasing. The report found 22% of middle-income travelers saving up to go on an international holiday when border policies and health situations improve. However, staffing struggles continue to affect traveler experience. If the challenges continue, hotels might itemize charges for services or bundle them into loyalty programs to ensure the availability of once-standard amenities. Recovery of the sector will be led by younger and wealthier travelers, with boomers significantly less likely to travel.

MGallery launches in Mexico: Accor, in partnership with Inmobilia, has signed definitive agreements for the development and management of the first MGallery Hotel & Residences in Mexico. Slated to open in 2024, Mayaliah Tulum Hotel & Residences – MGallery Hotel Collection in Tulum will consist of 45 rooms and 95 branded residences. Accor currently has 32 properties in Mexico with more than 10 properties in the pipeline across several brands. There are more than 50 MGallery hotels in various stages of development globally, with an additional 30 properties expected to open in the next two years.