Change take
Hotel companies, developers and investors this week signaled with their various deals that they are all looking at the hotel industry for the long term. Omicron and the rest of the pandemic are a slip in the build and brand expansion schedule.
Cameron Sperance
Here is a selection of what the Daily Lodging Report has brought to its readers over the past week. If you’re not a subscriber, you should be. Do not wait. Register here now.
Sunday December 12th
The shutters Trump International Hotel & Tower Vancouver will reopen sometime in 2022. Daily Hive Urbanized confirmed that upscale hotel property is the brand’s second life. will wear Paradox Hotel, a new international hotel chain that also plans to open locations in Phuket, Thailand and Singapore in 2022. Paradox Hotel is now also the operator of Summit Lodge boutique hotel. Both Summit Lodge and the former Trump branded tower are owned by Holborn Group. It is not clear whether Paradox Hotel is a new hotel division of. is TA Global Berhad, which is closely associated with the Holborn Group under the same ownership and management. The Holborn Group opened the Trump brand Vancouver in February 2017, with TA Hotel Management, the Canadian subsidiary of TA Global Berhad, operating the hotel. The hotel was permanently closed in August 2020 due to the effects of the pandemic and TA Hotel Management filed for bankruptcy. The 63-story tower contains 147 guest rooms, amenities, and ballrooms on the first 15 floors and 217 luxury condominiums on the upper floors.
Skift Note: Another Trump Hotel finds new life (and trademarks). When does portfolio bleeding stop?
Monday December 13th
Hilton and Jin Jiang International announced the extension of the Hampton by Hilton Management license agreement extending to 2034 to build a network of more than 600 Hampton by Hilton hotels in China. The exclusive license agreement is between Hilton and Jin Jiang’s Paid and was first signed in 2014. The extension marks an enhanced collaboration between Hilton and Jin Jiang as they usher in a new phase of joint development in an ambitious plan to operate over 600 Hampton by Hilton hotels in China. The 155th Hampton in China opened in Beijing on December 7th. There are over 355 Hampton by Hilton hotels in the China development pipeline.
Skift note: Asia, especially China, already had one the future development pipeline of Hilton under control. Expect more deals like this on other Hilton brands.
Tuesday December 14th
MGM Resorts and Hard Rock International announced a deal for Hard Rock to buy operations from The Mirage Hotel and Casino on the LV Strip for $ 1.075 billion in cash. Hard Rock essentially takes on the long-term rental agreement VICI properties for an initial annual base rent of $ 90 million per year. Hard Rock will license The Mirage brand for three years as they begin repositioning the property into a guitar shaped Hard Rock property on the LV Strip. VICI can make up to $ 1.5 billion of a Mirage recovery plan through. finance VICIs Partner Property Growth Fund. Analysts named the price higher than expected, once again showing appetite for LV Strip assets. Add to that the news last night that Las Vegas will host the 2024 Super Bowl and LVS without relying on convention, and group business is reflected in that value. MGM is still adding in what is an overflowing treasure trove of money.
Skift Note: Owning a casino resort in Las Vegas looks very different than it has been in the past. Established players like MGM Resorts are parking resources that were once reserved for real estate ownership in online gaming and newer gambling destinations.
Wednesday December 15th
Average daily price increases and an increase in hotel occupancy by 35.1% compared to the previous year in the third quarter Demand for US hotel stays despite Delta variant. Continuous improvements in domestic travel and the removal of many international travel restrictions have resulted in CBRE Revise its forecast significantly upwards in the short and medium term. The RevPAR is now expected to reach the nominal level of 2019 in the second half of 2023 and not, as previously forecast, in 2024. Still Omicron variant and ongoing pandemic concerns continue to dampen business, convention, and large group travel. CBRE expects these travel categories to accelerate in the second half of 2022. In the future, existing hotels will benefit from below-average new construction deliveries, as the cost and availability of construction services, including the labor force, will increase supply from 1.2% to 1.3% by 2025. This is well below the long-term average of more than 2% .
AAA predicts crowded streets and skies, with air traffic nearly triple in 2020. More than 109 million people, up nearly 34% from 2020, will travel 50 miles or more when they get on the streets, get on planes, or use other modes of transportation outside of the city between December 23 and January 2. The dramatic recovery, with 27.7 million more travelers traveling, will bring this year’s numbers to 92% of 2019 levels. Airlines will see an increase of 184% over the previous year. Road trips remain the most popular means of travel during the holidays, with over 100 million planning to reach their destination by car. More than 6 million are expected to travel by air, while 3 million people book buses, trains and cruises. AAA booking data through October shows theme parks, beaches, and Las Vegas are popular destinations domestically. According to the AAA, the travel prices are higher during this holiday season. A recent analysis of AAA’s flight booking data found that ticket prices for Christmas week were up 5% year over year. Mid-range hotel prices for AAA-approved hotels for Christmas trips rose 36%; and the average car rental price is up 20% for Christmas trips.
Skift Note: Omicron will dampen the expected winter business travel recovery, but a Pushback at border closings can mitigate the blow of this expected speed limit. The strong demand for vacation travel and the avoidance of travel restrictions in the US will continue to make the country a world leader in hotel recreation.
Thursday December 16
Trip.com Chairman James Liang believes that once the borders are reopened, Chinese international travelers are likely to revert to old travel habits and preferences. He predicts that China will begin reopening its borders to the world in mid-2022. While he may just be pulling things out of nowhere, Liang said by the end of the third or fourth quarter, things will return to normal and once the border is fully open we will certainly see some catching up to do to travel outside of China. Liang must have a crystal ball to say things like this when the first Omicrom cases were reported in China and everyone there was preparing for a lockdown to eradicate Covid ahead of the Winter Olympics in February. Liang is confident that the popular pre-pandemic travel destinations will see a very strong recovery – including Japan, Thailand, South Korea and Macau. The pandemic has shown the Chinese just how much they can do domestically and has resulted in the popularization of small groups or private tourist groups as opposed to large tour groups of 30 to 40 people. He pointed out that there is a dark cloud pointing to China’s alleged black tourist list. The Chinese government reportedly has a list of countries that have been identified as targets for gambling on Chinese nationals. Although Beijing recognized this list, nobody really knows which countries are on it.
Skift note: China spotted its first Omicron case this week, so take any recovery forecast lightly. But if China’s international borders are opened in mid-2022, it will much harder to find a hotel room in some of the world’s largest cities.
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