Tag: lodging

Hilton Worldwide plans to launch in early 2025 a new North American prototype for its upper-midscale limited-service Hampton by Hilton brand, the hotel company announced Wednesday.

The new prototype features a layout that will allow for more guestrooms within the same hotel footprint, according to Hilton, along with an “optimized” suite room layout “for better site efficiency.”

Hilton said the Hampton prototype will include a reconfigured lobby space, with the front desk and retail shop each repositioned and a “flexible multi-use space” introduced.

The Hampton protoype’s guest rooms will include a new “multi-functional task table” along with larger windows and “optimized in-room guest storage solutions.”

There are more than 3,000 Hampton properties worldwide, according to Hilton.

Short-term accommodation provider Sonder Holdings’
fourth-quarter revenue increased to about $164 million from $135 million one
year prior, the company announced Friday, though revenue per available room
slid to about $150 from $158.

Sonder delayed formal reporting of its fourth-quarter and
full-year results, as well as its earnings call with analysts, after it “recently
identified accounting errors related to the valuation and impairment of
operating lease right of use assets and related items for the fiscal years 2022
and 2023,” the company said in a Friday statement. The errors “are
non-cash in nature and will not impact the company’s reported cash balances,”
Sonder said, but noted “the restatements will increase the company’s
overall net loss and loss per share in the impacted periods.”

Sonder’s fourth-quarter occupancy rate of 82 percent was
down from 83 percent one year prior. Its full-year occupancy rate also was 82
percent, up from 81 percent in full-year 2022. 

Sonder’s full-year revenue increased to $603 million from $461
million in 2022. Full-year RevPAR was $151, the same as it was in 2022. 

The company said it had 12,200 live units as of Dec. 31, up
from 9,700 one year prior. 

Sonder last month announced it would lay
off 17 percent of its corporate workforce.

RELATED: Sonder
Q3 performance

Hotel bookings among Hickory Global Partner members reached
96 percent of 2019 levels in 2023, with Houston the most popular city among
members for business travel, the corporate travel alliance reported.

With rising hotel costs, spending on hotels by Hickory
members surpassed 2019 levels by 19.6 percent in 2023, and “business
travel picked up significantly” throughout the year, according to Hickory
president Chris Dane. Bookings this year should surpass 2019 levels, Hickory
reported.

Those rising costs, meanwhile, also are driving business
trips and events to cheaper cities, which could be a factor in Houston’s
popularity, per Hickory’s report. The average daily rate of spend in Houston
for Hickory members was $153.91, compared with $408.19 for New York, which ranked
third among the most popular locations for members.

Last year, Hickory noted that Houston was
emerging as a “business travel hub” in the US.

Hickory also reported that Sacramento—which had an average
daily rate of spend of $142.28—rose to the 10th spot on the top ten list with
“an influx of people relocating from higher-cost cities like Los Angeles
and San Francisco.” Neither of those two cities were in Hickory’s top ten,
though San Diego ranked second.

Among cities outside of the U.S., London was the most
popular destination for Hickory members, followed by three Canadian
cities—Toronto, Calgary and Montreal—due to their proximity in the US and many
multinational members having a significant presence in Canada.

Hickory noted that bookings in Tokyo increased 100 percent
year over year as travel to Japan opened up in early 2023, making the city
ranked 5th overall in popularity. Bookings in Paris, meanwhile, were down 6.3
percent, which Hickory said could be attributed to its high cost of $431.24 per
night.

The Hickory alliance in total has more than 2,500 members
across 74 countries and works with more than 51,000 hotel partners.

Hyatt Hotels Corp.’s business transient demand
“continues to gain momentum,” company officials said Friday, with
systemwide fourth-quarter revenue for the segment up 11 percent year over year.
Meanwhile, negotiated corporate rates for 2024 in the United States are up in
“the high single digits,” Hyatt CEO Mark Hoplamazian said Friday on
an earnings call.

Overall Hyatt systemwide fourth-quarter revenue per
available room increased 19.1 percent year over year, a figure that outpaced
Hyatt’s projection of 15 percent to 16 percent. Increased demand in all sectors
lifted that boat, officials said, including business transient travel, revenue
from which in Q4 reached 93 percent of 2019 levels globally.

“Business transient has fully recovered to 2019 levels
in many parts of the world, while the United States continues to improve,”
Hoplamazian said. “Looking ahead, we remain confident that business
transient will continue to recover, with 2024 corporate negotiated rates in the
U.S. up in the high single digits compared to 2023.”

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Fourth-quarter room revenue from group bookings was up 11
percent from 2022, Hoplamazian said, and the group booking pace for full-service
managed properties in the Americas region is up 8 percent from 2023 levels.

Hyatt Q4 and Full-Year Performance

Hyatt’s fourth-quarter systemwide RevPAR increased 9.1
percent year over year to $138.63, while average daily rate increased 2.5
percent to $205.31 and occupancy increased 4 percentage points to 67.5 percent.

For the full year of 2023, Hyatt’s RevPAR increased 17
percent year over year to $141.18, while ADR grew 4.7 percent to $204.60 and
occupancy increased 7.2 percentage points to 69 percent.

Hyatt’s performance was driven by its Asia-Pacific region,
where fourth-quarter RevPAR increased 37.6 percent year over year and full-year
RevPAR increased 60.3 percent.

Hyatt projects a full-year 2024 systemwide RevPAR increase
of 3 percent to 5 percent year over year, in line with most
industry forecasts. The 2024 increase in the U.S. is projected to be at
“the lower end of that range,” Hyatt CFO Joan Bottarini said on the
call. 

Hyatt fourth-quarter revenue increased to $1.66 billion from
$1.59 billion year over year. Full-year revenue increased to $6.67 billion from
$5.9 billion one year prior. Fourth-quarter net income was $26 million compared
with $294 million the year prior, while full-year net income declined to $220
million in 2023 from $455 million in 2022.

The company said 101 properties—including 43
conversions—joined its portfolio in 2023, representing nearly 24,000 rooms.
Hyatt’s pipeline at the end of the year included 650 properties representing
about 127,000 rooms, according to the company.

RELATED:  Hyatt
Q3 performance

Two years ago, Accor Group chairman and CEO Sébastien Bazin
joined the pandemic-era chorus of executives who predicted corporate travel
would never fully recover to 2019 levels, thanks to the growing acceptance of
remote conferencing tools. On Thursday, he formally retracted his projection.

“I was wrong,” Bazin said Thursday during Accor’s
fourth-quarter earnings call.

Like several executives inside and outside of the travel
industry, notably
Bill Gates, Bazin in 2022 suggested at least some of the corporate travel
cutbacks companies implemented during the Covid-19 pandemic were permanent. Bazin
at the time suggested projections that international business travel would
remain at least 20 percent below pre-pandemic levels “could probably last
forever” because “of our capacity via Zoom, WebEx and Teams to be
able to connect yourself without going onto a very long journey” compared
with “the agony of crossing the frontiers with all the paperwork you will
have to do.”

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Thursday, he sang a different tune. “I was wrong three
years ago when I said we’re probably going to stand to lose 25 percent of
corporate travel forever because of this ability to work remotely,” Bazin
said. “We are already at 90 percent of the level of 2019. So they’re not
only coming back, but they’re coming back much quicker than I ever expected.”

Bazin projected an additional average 8 percent
year-over-year increase in 2024 business travel spending “from major
corporate organizations.”

Still, he noted the nature of post-pandemic business travel
has changed from the past. 

“It’s a different mix,”
Bazin said. “It’s less people going alone from Seattle to Singapore, it’s
less people having 500 [attendee] seminar organization groups. It’s spread over
10 cities of 50 people each and they go on Microsoft and all the systems where
they can regroup together, even though they are in different locations. So
smaller groups, greater numbers of small and medium-sized enterprises, but it
is a very strong component of Accor and the rest of my peers.”

Accor’s Q4 Performance

Accor’s systemwide fourth-quarter revenue per available room
increased 11.1 percent year over year to €73, while average daily rate
increased 6.7 percent to €111 and occupancy increased 2.6 percentage points to
65.8 percent. Full-year 2023 systemwide RevPAR increased 22.7 percent year over
year to €73, while ADR increased 11.8 percent to €110 and occupancy grew 6
percentage points to 66 percent.

Total 2023 Accor revenue increased 20 percent year over
year—18 percent on a like-for-like basis at constant currency—to nearly €5.1
billion. Earnings before interest, taxes, depreciation and amortization
increased 49 percent year over year (55 percent like-for-like) to €1 billion.

The company projected a compound annualized RevPAR increase
of 3 percent to 4 percent through 2027. January 2024 systemwide RevPAR was
“solid” and “in line with our expectations,” said Accor CFO
Martine Gerow on the call. 

RELATED: Accor
Q3 performance

January U.S. hotel occupancy declined year over year while average
daily rate and revenue per available room increased, according to hotel
analytics firm STR.

U.S. occupancy in January was 51.9 percent, down
1.7 percent year over year and also down from the 52.6 percent posted
in December 2023. 

ADR increased 2.7 percent year over year to $146.33, a
figure down from the $151.13 reported for December 2023. RevPAR increased 0.9
percent year over year to $75.99.

Hawaii’s Oahu Island posted the highest January occupancy
level among STR’s top 25 markets at 79 percent, up 6.2 percent year over year.
Minneapolis posted the lowest January occupancy STR’s top 25 markets at 40.7
percent, followed by St. Louis at 43.7 percent.

STR’s top 25 markets ” showed
higher occupancy and ADR than all other markets,” according to the
company.

RELATED:STR
December 2023 results

Wyndham Hotels & Resorts’ fourth-quarter systemwide revenue
per available room slipped year over year amid what president and CEO Geoff
Ballotti on a Thursday earnings call termed the “distraction” of
Choice Hotels International’s hostile pursuit of the company. 

Systemwide fourth-quarter RevPAR declined 1 percent year over year
at constant-currency levels, and U.S. RevPAR declined 4 percent, Ballotti said,
in part due to what he called a moderation of post-pandemic “revenge”
leisure travel.

Still, Ballotti said Wyndham has seen a “double-digit
increase” in the infrastructure bookings that make up the lion’s share of
the company’s business travel bookings. He cited several projects made possible
by U.S. federal infrastructure spending that Wyndham hopes to capitalize on,
and he noted that the company has “increased our sales force that’s
selling to these infrastructure accounts by 25 percent.”

Infrastructure-related travel bookings made up 22 percent of
Wyndham’s 2023 gross room revenues, according to a presentation for investors,
with “logistics and other” chipping in another 5 percent and
corporate transient accounting for 2 percent.

Ballotti again reiterated the Wyndham board’s opposition to Choice’s
hostile bid for the company, citing “the inadequacy of the value of
the offer,” “the
significant amount of Choice stock” in the offer and the possibility of
federal regulatory review.

Q4 Metrics and Outlook

Wyndham’s fourth-quarter global RevPAR decreased 1 percent year
over year at constant currency to $38.90. U.S RevPAR declined 4 percent to
$44.06. International RevPAR increased 7 percent to $32.12.

The company projected full-year 2024 systemwide RevPAR growth of 2
percent to 3 percent year over year.

Fourth-quarter net revenues were $321 million, compared with $334
million one year prior. Net income was $50 million, compared to $56 million in
the fourth quarter of 2022. 

Wyndham’s total room count at the end of 2023 was 871,800 rooms,
up about 3.5 percent from one year prior, with U.S. rooms up about 0.8. to
497,600. Ballotti highlighted Echo,
Wyndham’s new extended-stay brand, a dozen of which he said are now
under construction, with 75 planned to be open in 2026.

RELATED:  Wyndham Q3
performance

U.S. extended-stay hotel available room supply in 2023 increased 1.8 percent year over year, the lowest increase on record, according to a new report by The Highland Group. Average daily rates in 2023 increased year over year, allowing for revenue per available room growth even as occupancy declined.

The small increase in U.S. extended-stay room supply in 2023 follows a similarly modest increase the year prior. The last time such annual supply growth was less than 2 percent was in 2011 and 2012, according to Highland Group partner Mark Skinner, when in the subsequent two years, growth remained below long-term averages. 

“We expect a similar pattern will emerge over the next two years given that interest rates and construction costs are much higher than they were a decade ago,” Skinner said in the report.

Most of the 2023 increase in supply fell in the economy extended-stay tier, where the room count increased 6.6 percent year over year, while midprice supply increased 1.5 percent and upscale supply held steady.

The U.S. extended-stay pipeline, however, is starting to show some sign of a rebound. Rooms under construction in 2023 increased 53 percent, bringing it to a level seen in 2020 after sharp declines in 2021 and 2022.

Several hotel companies in the past 18 months have announced the development of new extended-stay brands, including Hilton Worldwide, Marriott International, Hyatt Hotels Corp. and Best Western parent BWH Hotel Group.  

Still, “the near-term risk of extended-stay hotel over supply is very low nationally … and plenty of excess extended-stay demand remains,” Skinner said in a statement. That should allow extended-stay hoteliers to maintain a level of pricing power after another year of rate increases in 2023.

Overall U.S. extended-stay hotel ADR increased 4.7 percent year over year to $118.80, with upscale ADR up 5.4 percent to $156.43. Overall occupancy declined 0.4 percent to 74.9 percent, although in the upscale tier it increased 1.2 percent to 75.7 percent.

The rate gains fueled a 2023 RevPAR increased 4.7 percent year over year to $88.98. Skinner noted that RevPAR increase outpaced that of the broader hotel industry, and given projections of year-over-year growth in hotel RevPAR of 3 percent to 5 percent in 2024, “we expect that to continue for the foreseeable future.”

Powered by gains in business transient and small corporate
group revenue, Hilton Worldwide on Wednesday reported an overall fourth-quarter
year-over-year revenue per available room increase of 5.7 percent. Meanwhile,
Hilton announced a loyalty partnership with the Small Luxury Hotels of the
World boutique hotel collection.

Fourth-quarter business transient RevPAR increased 4 percent
year over year on higher occupancy and rates, Hilton president and CEO
Christopher Nassetta said Wednesday during an earnings call. The gains again
were led by small and midsized enterprises, he said, but noted that larger
companies were recovering too.

“The big corporates finished the year still a bit off,
probably 5 percent off of where they were but still growing,” Nassetta
said. “Most segments were relatively strong and either back to or beyond
prior to pandemic levels, with the exception of probably banking, technology
and consulting, which were less. But blended together, they weren’t that far
off.”

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SMEs accounted for about 85 percent of Hilton’s business
transient mix, as well as a “meaningful and growing percentage of our
group mix,” he said, and that segment’s RevPAR has surpassed pre-pandemic
levels. 

In Q4, “from a RevPAR point of view, business transient
was ahead, but from an occupancy point of view was still a bit behind,”
Nassetta said. “We do think that by the time we finish this year, assuming
the broader consensus view of a reasonably soft landing … we think will be at
more normalized levels of demand.”

“Thousands” of organizations have registered for
the company’s Hilton for Business rewards program, designed for SMEs, since it
was unveiled
in January, he said. 

Small company meetings helped Hilton’s fourth-quarter group
RevPAR increase 6 percent year over year, Nassetta said, and the sector remains
red-hot. “Demand is really strong, he said. “Every quarter is the
next new high-water mark in terms of bookings for all future periods.”

Q4 Metrics, 2024 Outlook

Hilton projected year-over-year increases in first-quarter
and full-year 2024 RevPAR of 2 percent to 4 percent, a figure below that of
some recent industry projections, including that of STR and Tourism Economics, which
forecast 4.1 percent 2024 growth. Still, Nassetta projected Hilton would
have “pricing power” in the business transient segment and
“everywhere else,” given “very low supply numbers that are
continuing and continued decent economic growth.”

Hilton’s systemwide fourth-quarter average daily rate was
$156.07, up 2.7 percent year over year. Occupancy increased 2 percentage points
to 69 percent. RevPAR increased 5.7 percent to $107.69.

Total fourth-quarter revenue increased 6.7 percent to $2.6
billion. Net income was $150 million, compared with $333 million in the fourth
quarter of 2022.

Hilton’s development pipeline at the end of the fourth
quarter comprised 462,400 rooms, a record and an 11 percent increase year over
year.

Small Luxury Hotels of the World Partnership

Hilton also announced a partnership with Small Luxury Hotels
of the World in which customers will be able to book through Hilton channels
participating properties in the boutique hotelier’s 560-property collection,
and Hilton Honors loyalty program members will be able to earn and redeem
loyalty points. Hilton said the partnership would “ramp up in the months
ahead.”

While many SLH properties are in resort locations, a number
are in urban locations, Nassetta said, and “I think business transient
will be a meaningful component of it, particularly in those hotels in the right
locations.”

SLH formerly had formed a similar loyalty
alliance with Hyatt Hotels Corp., but a Hyatt spokesperson confirmed to BTN
that the companies had “mutually made the decision to end our relationship
with SLH in the near future,” though World of Hyatt loyalty program members
still can book participating SLH Hotels on Hyatt booking channels. Hyatt in
2024 plans to integrate boutique properties listed in Mr & Mrs Smith, the
London-based booking platform it acquired last year, according to the
spokesperson.

RELATED: Hilton
Q3 performance

The U.S. extended-stay hotel occupancy level in the fourth quarter of 2023 was 71.5 percent, the lowest fourth-quarter non-pandemic figure since 2013, according to a new report from The Highland Group, released Friday.

Meanwhile, the segment’s fourth-quarter average daily rate increased 2.1 percent year over year to $116.31, and revenue per available room increased 1 percent to $83.18. That’s the smallest Q4 RevPAR growth since 2019, according to Highland. 

Occupancy decreased year over year for the third consecutive quarter, according to Highland, and declined in each of the three tiers the company tracks: upscale, midprice and economy. Fourth-quarter occupancy last was lower than 71.5 percent in 2013, when it was 71.1 percent, excepting 2020, when it was 62.9 percent. 

The lower occupancy comes amid growth in supply, with available fourth-quarter rooms up 2.3 percent year over year to about 53.4 million, a net gain in rooms that was the lowest since 2013, according to Highland. 

“With interest rates and constructions costs likely to remain relatively high, the risk of extended-stay hotel over supply nationally is very low in the near term, despite the launch of several new brands,” Highland partner Mark Skinner said in a statement.

Fourth-quarter ADR increased more sharply in the upper extended-stay tiers, with upscale up 2.7 percent to $153.81 and midprice up 3.6 percent to $107.40.

Among U.S. hotels, revenue per available room and average daily rate in December showed modest year-over-year increases while occupancy slipped, according to hotel analytics firm STR.

December U.S. hotel RevPAR was $79.42, up 0.3 percent year over year and down from $88.36 the month prior. December U.S. hotel ADR was $151.13, up 2.1 percent year over year and down slightly from $151.23 in November. 

U.S. hotel occupancy in December was 52.6 percent, down 1.8 percent year over year and down from 58.4 percent the month prior.

Across the board, the lower month-to-month metrics were “as expected” due to the holiday season, according to STR. 

Among STR’s top 25 markets, New York City again reported the highest December occupancy level at 86.6 percent, which was up 4.3 percent year over year. Minneapolis and St. Louis again had the lowest occupancy among those cities, at 42.5 percent and 45.8 percent, respectively.

Overall, the top 25 markets “showed higher occupancy and ADR than all other markets,” in December and for full-year 2023, according to STR.

Full-Year 2023 Metrics

In 2023, the U.S. hotel industry reported its highest annual RevPAR and ADR “on record,” according to STR. U.S. hotel RevPAR was $97.97 in 2023, up 4.9 percent year over year, and ADR was $155.62, up 4.3 percent. 

Additionally, 2023 U.S. hotel occupancy was 63 percent, up 0.6 percent year over year and the country’s “highest since 2019,” according to STR.

Among STR’s top 25 markets, New York City reported the highest performance levels across the board in 2023. New York RevPAR in 2023 was $245.77, up 18.1 percent year over year, while ADR was $301.22, up 8.5 percent. New York’s occupancy in 2023 was 81.6 percent, up 8.8 percent.

RELATED: STR November 2023 results