- UK room rates tumble but London occupancy at solid 80.4%
- Asia new hotel development hot even as occupancy and revenue slides
- Numerous properties in Beijing, Shanghai and Hong Kong stand half empty
- Hawaii occupancy rises after 18 months of declines
- Ireland hoteliers face crisis as glut of inns and new tax rules crimp bottom line
- Strong bookings of medical and scientific seminars save Italy's lodging market
- Las Vegas strip gaming revenue expected to increase by 3% to 7% in 2010
- Sol Melia's nine-month net profit down $70.5 million (47.5 million euros)
- Marriott Plans new brand Autograph Collection
- Nazarian runs into hurdles at his planned jet-set hotel chain
(LONDON, UK) -- Revenue per available room (revPAR) fell 10.9% to £60 ($99 US) during the first three quarters of 2009, Deloitte reports. Average room rates fell 7.2% to £85 while occupancy dropped 4.0% to 70.5%. One British pound equaled $1.65 U.S. on Nov. 12.
Marvin Rust
Marvin Rust, Hospitality Managing Partner at Deloitte, says "to achieve over 80% occupancy during one of the most severe economic downturns in history is very impressive, and the capital (London) is proving to be one of the most resilient cities across the globe."
Rust says, "Leisure demand on the weekends has been particularly strong in London resulting in hotels achieving stronger results during several weekends this year compared to last."
He adds, "The number of overseas visitors to the UK were down 8% during the first seven months of the year, according to the Office for National Statistics.
"However, a surge in domestic tourism is counter-balancing this decline. So far this year, overseas departures by UK residents have decreased 16% as the appeal to holiday in the UK heightens.
"This has helped hotels to avoid the massive average room rate discounting that has taken place in other European countries."
(HONG KONG) -- Despite occupancy and room-rate plunges across Asia, the U.S. and Europe, Asia continues to attract new hotel development, according to The New York Times.
October saw two major hotels open in Hong Kong - the 381-room Hyatt Regency Hong Kong and the 117-room Upper House. A 300-room Ritz-Carlton is scheduled to open in 2010.
Michael Issenberg, head of Paris-based Accor's Asia-Pacific business, tells The Times, "We're growing more rapidly here than in any other region in the world."
He cites Accor's plans to open 54 hotels with about 10,000 rooms in Asia this year and the same number of rooms again in 2010. In India alone, Accor plans to have 50 hotels with at least 10,000 room by 2012. The French firm has only five hotels in India today.
"The growth opportunities in Asia-Pacific are unsurpassed perhaps anywhere in the world," says Frits van Paasschen, CEO, Starwood Hotels & Resorts Inc. Starwood has 150 branded hotels in Asia.
(BEIJING, CHINA) -- Not all Asia hotel markets are thriving. The China Daily Mail reports the Beijing Marriott which opened just before the 2008 Olympics and was booked solid, saw its occupancy fall to 20 percent earlier this year.
Deloitte reports revenue per available room plunged 56 percent in Beijing in the first eight months of this year. In Shanghai, the figure was down 35 percent with many hotels remaining half empty.
For the entire Asia-Pacific region, revenue is down 28.4 percent. Businesses and tourist are cutting back on overnight stays and events, forcing hoteliers to offer deep room price discounts, according to The Times.
"Europe and the United States are still in a total mess, and Asia is not immune to what is going on there," notes Albert Edwards, head of global strategy at Societe Generale, a global corporate and investment bank based in Paris.
There is still plenty of room for growth, in China especially, says Paul Foskey, head of Marriott International's Asia operations.
"Look at the statistics," Foskey points out. "The United States currently has 4.9 million hotel rooms catering to a population of 300 million.
"Europe has about 5.3 million rooms. China, with its population of 1.3 billion, has only 1.7 million, and Indian barely has 120,000" rooms. "There is a lot of runway left in these countries," Foskey adds.
(HONOLULU, HAWAII) -- Honolulu is receiving some good news finally. After 18 consecutive months of declines, occupancy is up for the first time, to 64.6 percent. In the same month last year, the number was 63 percent.
Hawaii Tourism Agency liaison Marsha Wienert says the increase came with the 7.2 percent jump in the number of island visitors in September. But she notes that while visitor numbers were up last month, revenue continued to suffer. Room rates fell 10.2 percent to $160.29.
Hawaii hotel revenue in the first nine months of this year fell 19.8 percent to $1.8 billion. That was $455 million less than the revenue tallied in September 2008, according to Hospitality Advisors LLC.
"The losses that Hawaii's industry has had to absorb over the past 20 months have been unprecedented," says Hospitality Advisors president and CEO Joseph Toy.
"While the losses have been steep, we should keep in mind that the global recession has had a tremendous impact not only Hawaii's visitor industry, but on its primary competitors as well."
Toy adds, "We are beginning to see the rate of loss narrow, which hopefully will lead to the start of a sustainable recovery, beginning in summer 2010."
(DUBLIN, IRELAND) -- A glut of inns and new tax regulations are hurting hoteliers in Ireland. They fear the industry may crumble completely unless new economic measures are taken, warns the Irish Hotels Federation.
The IHF was responding to a special report released by economist Peter Bacon. He outlined a series of urgent actions needed if the hotel sector is to survive.
"The report highlights the damage which is being caused to the hotels sector as a whole by financial institutions and banks supporting unviable and insolvent enterprises," according to a statement by IHF president Matthew Ryan posted by Hotelnewsnow.com.
"The report clearly reinforces hoteliers' concerns that the industry will collapse unless action is taken" now, says Ryan. "This (collapse) cannot be allowed to happen, given tourism is one of the largest indigenous contributors to the (Ireland) economy."
(ROME, ITALY) -- Medical and scientific meetings and seminars scheduled by global corporations and pharmaceutical companies are saving Italy's lodging industry, according to a report posted by Hotelnewsnow.com.
The meetings industry accounts for 11 percent and 23 billion euros ($34 billion U.S.) of the Italian tourism sector's business, according to Mario Buscema, chief of the health events' department of Federcongressi, that association that represents the meeting industry's operators. Medical and scientific conferences contribute 30 percent of the tourism revenue.
"The meeting industry slowdown is severe because of companies' budget crunches and because enterprises that are facing redundancies don't want to spend too much for events," says Buscema.
Massimiliano Corradino
"Medical conventions account for 50 percent to 70 percent of the meeting business in four-star hotels and 30 percent at the five-stars," says Massimiliano Corradino, manager of Boscolo Hotels' meetings, incentives, conference and events division.
(LAS VEGAS, NV) -- Revenue along the Las Vegas Strip hotel, casino and retail corridor should increase in 2010 by 3% to 7%, predicts a new 85-page report from CB Richard Ellis's Global Gaming Group.
Jacob Oberman, CBRE's director of gaming research and analysis, says "2008 and 2009 will go down as two of the most tumultuous years in the history of the Strip."
He says, "Although most Las Vegas Strip casinos will likely experience revenue and earnings declines in 2010, future implications for Las Vegas are positive.
Oberman says "investor sentiment will likely improve as 'headline' market revenue data measured on a year-over-year basis turns positive."
Additionally, he says, "market revenue growth sets the stage for net positive job growth for Strip casinos in 2010, which bodes well for the local Las Vegas economy. "
Brent Pirosch, CBRE's director of gaming consulting services and co-author of the report with Oberman, notes that "having worked in casinos ourselves, we bring a unique viewpoint not found in typical investment reports."
(PALMA, ITALY) -- Sol Melia, a 53-year-old, Palma-based company that calls itself the world's leading resort hotel chain, posted nine-month net profit of 47.5 million euros ($70.5 million US), 40.7% less than in the same 2008 period.
(One euro equaled $1.49 U.S. in Nov. 12 global currency markets.)
In a prepared statement, the company says, "Given the market conditions and the strong influence of unemployment and weak consumer demand on the tourism and travel industry, the results may be considered positive, both in absolute terms and in comparison to other companies in the industry."
Sol Melia revenue between January and September of this year reached 899.9 million euros, 9.3% less than in the first nine months of 2008.
EBITDA decreased by 16% versus the same 2008 period, falling from 220.8 million euros to 185.5 million euros.
Average occupancy which fell 12.1% in the second quarter dropped by only 6.6% in the third quarter. The 16.1% revenue slide compared to an 18.8% fall in the first nine months of 2008.
Sol Melia currently operates more than 300 hotels in 28 countries on four continents under its eight brands - Gran Melia, Melia, ME, Innside, Tryp, Sol, Paradisus and Sol Melia Vacation Club.
(BETHESDA, MD) -- Robert J. McCarthy, brand group president at Marriott International, confirms the chain is launching a new brand called Autograph Collection.
Hotelnewsnow.com reports the new brand will be used to convert about 30 full-service hotels during the next year. McCarthy disclosed the company's plans at a recent breakfast meeting sponsored by the Cornell University School of Hotel Administration.
The new brand, however, "will not have the same consistent quality standards of other Marriott brands but all hotels would have a minimum standard of quality," McCarthy said.
Financial problems faced by many independent properties will make the properties "ripe for conversion to the new brand," Hotelnewsnow.com reported.
(LOS ANGELES, CA) -- Nightclub impresario and Hollywood celebrity intimate Sam Nazarian is running into hard times as a hotelier, according to The Wall Street Journal.
Nazarian's budding chain of jet-set hotels are not taking off as the entrepreneur had planned. His three acquired start-up properties for the chain are the 297-room Le Meridien in Beverly Hills, the Sahara casino in Las Vegas and the 119-room former Ritz Plaza hotel in Miami Beach.
The WSJ reports Nazarian's ongoing $25 million renovation of the Ritz Plaza and the planned $75 million renovation of Le Meridien are being delayed by city reviews and construction changes.
In Las Vegas, Nazarian has postponed plans to renovate the 1,700 room Sahara which he and partner Stockbridge Real Estate Funds bought in 2007 for $300 million. Frank Sinatra and partners owned and operated the Sahara in the 1960s.
Nazarian bought Le Meridien in 2005 with a mortgage loan of $137 million. Renovations closed the hotel for much of 2007 and 2008. In the first half of this year, occupancy was 64.6%, still more than the average 61% acknowledge at other luxury Los Angeles hotels.
At the Sahara, rooms were being offered for $21 a night recently, the WSJ reports.
Nazarian's company, SBE Entertainment, is talking with lenders to extend and modify current construction loans on the Beverly Hills and Vegas properties.
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