AENDRE Group, a real estate platform focused on the development and conceptualisation of lifestyle aparthotels, has launched with backing from newly formed private equity firm JuneX Capital Partners, and co-investor New End, to execute on its strategy of creating and scaling disruptive hospitality brands.
Hotel development is a complex undertaking. It requires little of the skills to operate and monetize the asset. Owners and architects are often ill-equipped to measure up the requirements for running a successful hotel a few years down the road. While certain industry trends exist, fundamentals still need to be observed. Words of caution for those attached to specific brands or roles a hotel is meant to fulfill – in today’s world of hyper-efficiencies it is becoming more difficult to provide everything for everyone. Or specifically: provide a comprehensive range of service to all types of travelers. The real estate required to accommodate these service encounters has simply become too expensive to build.
Travel bookings are back. Online sales are expected to account for 76% of total revenue in the travel and tourism sector by 2028, by which time, revenue is set to reach £746.4bn (Statista).
CapitaLand Ascott Trust (CLAS) has acquired the remaining 10% stake in Standard at Columbia, a freehold student accommodation property in South Carolina, United States of America (USA). The earnings before interest, taxes, depreciation and amortisation (EBITDA) yield on total development cost is expected to be approximately 7%. This is higher than the 6.2% EBITDA yield that was projected in 2021 on the basis that the property has achieved stable performance. The acquisition is funded by proceeds from CLAS’ earlier divestments.
Sekisui House REIT Sold St. Regis Hotel Osaka for JPY 21.35 Billion, Fortress Acquired Phoenix Seagaia Resort in Kyushu from Sega Sammy, ARA H-Trust to Sell Two Hyatt House properties to GHM Properties for USD 31 Million, Hanoi’s Noi Bai airport’s International Terminal is Undergoing a USD 196 Million Expansion.
Accommodation providers - from hotels to serviced apartments - need more than just a tech plug-in to succeed in today’s digital-first landscape. As the distribution landscape becomes increasingly fragmented, and guests’ demands and expectations evolve at pace, operators are turning to representation companies to devise and implement wide-reaching commercial strategies.
Value hotel group easyHotel has further strengthened its financial position by securing a £42.5million loan from Santander UK to support its British and European expansion, alongside an additional £6 million loan from BRED Banque for one of its French hotel’s.
Over the past couple of months, it has become increasingly clear that interest rates for hotel financing, and just about everything else, may stay higher for longer. As markets adjust to this expectation, many investors are realizing that they may not be able to delay deals until rates drop back down to so-called “normal” levels. There is mounting pressure for financing decisions that will need to be made in the coming months. In this article, we have compiled and analyzed historical hotel interest rate data, as well as indications from the Federal Open Markets Committee (FOMC or “Fed”) on the anticipated direction of future interest rates, to help provide some context for the past, present, and future of the hotel financing market.
Digital procure-to-pay (P2P) solutions are a no-brainer for the modern hotelier, streamlining procurement cycles and generating insights for more strategic purchasing decisions. But these goals can’t be realised unless everyone is on board for the investment—particularly hospitality leadership and owners.
The Ernest N. Morial New Orleans Exhibition Hall Authority (the Authority) has approved two resolutions critical to moving forward with the development of a 1,000-room headquarters hotel for the New Orleans Ernest N. Morial Convention Center (NOENMCC). In addition to accepting a formal letter of intent (LOI) with Omni Hotels & Resorts (Omni) to own and operate the headquarters hotel, today the Authority voted to approve a purchase and sale agreement for property at Convention Center Boulevard and Andrew Higgins Boulevard. The site, currently operated as the Sugar Mill event venue, is immediately across the street from the Convention Center and is the preferred site for the new headquarters hotel.
A capitalization rate (“cap rate”) is a shorthand expression of a given investment’s return and represents the weighted average return to the debt and equity positions. As detailed in this article, hotel cap rates are higher than they’ve been in recent years and are unlikely to decline anytime soon.
The 12th revised edition of the Uniform System of Accounts for the Lodging Industry (USALI) fundamentally enhances the transparency of financial and operational aspects in the hospitality industry. To quote Sir Arthur Conan Doyle's iconic character Sherlock Holmes, “It is a capital mistake to theorize before one has data.”
Determining the current selling or asking price for a hotel is a bit tricky. Compared to estimating the present value of a house it’s more like a detailed math exercise rather than a google search on Redfin. That’s what this piece is all about, how you can estimate the value, AKA sales price.
LuxUrban Hotels Inc. (“LuxUrban” or the “Company”) (Nasdaq: LUXH), a hospitality company which leases entire existing hotels on a long-term basis and rents rooms in its hotels to business and vacation travelers, today announced the launch of a proposed follow-on public offering of shares of its common stock. All of the shares of common stock are being offered by the Company pursuant to a shelf registration statement on Form S-3 (No. 333-278883) (the “Registration Statement”) filed with the Securities and Exchange Commission (“SEC”) and declared effective on May 8, 2024. The offering is subject to market and other conditions, and there can be no assurance as to whether or when the offering will be completed, or as to the actual size or terms of the offering. Certain officers, directors, and holders of 5% or more of the Company’s common stock and affiliates thereof may participate in the offering.
Last week at JMBM’s Meet the Money® national hotel finance conference, The Lodging Industry Investment Council (“LIIC”) released its much-anticipated LIIC Top Ten – the 2024 update of its an annual survey of investment sentiment survey.
Mews, the industry-leading hospitality cloud, has launched the funding program Flexible Financing, which provides hospitality businesses with access to capital, as the number of hoteliers branching out to offer additional amenities for guests has more than doubled in the last year.
Prior research conducted by CBRE Hotels Research revealed that hotel management companies were rewarded handsomely as the U.S. lodging industry recovered from the COVID-19 pandemic. An analysis performed by CBRE in April 2023 found that total hotel revenue increased by 153% from 2020 to 2022, while Gross Operating Profits (GOP) grew by 437%. This resulted in a 68% increase in the fees paid to management companies and brought management fees back to pre-pandemic levels. The increases in fees were largely due to the improved performance of U.S. lodging properties, which in turn triggered the payment of incentive management fees.
For hotel owners, embracing a property improvement plan (PIP) may initially seem financially challenging, especially given today’s market uncertainties, high construction costs, increased interest rates, and labor shortage. However, PIPs serve as a valuable opportunity to reassess the hotel’s overall strategy and help chart a course of action toward enhanced profitability – whether undergoing a PIP, switching brands, or selling the asset.
Hospitality Net and Hospitality Financial and Technology Professionals (HFTP®) are collaborating on a brand-new survey which aims to gather and analyze data on current investment trends, funding needs, future investment priorities, technology adoption rates, and the overall market dynamics within the hotel technology ecosystem. The objective is to identify areas of growth, potential investment opportunities, challenges facing the sector, and how technological innovations are shaping the future of the hotel industry.
An effective partnership between the Chief Marketing Officer (CMO) and Chief Financial Officer (CFO) is crucial, as research shows that finance and marketing are intrinsically linked. Therefore, aligning marketing initiatives with the broader financial strategy leads to better performance. CMOs are tasked with deploying budgets in ways that they believe will maximize business growth through strategic marketing efforts. Simultaneously, CFOs are responsible for overseeing the company's financial health, ensuring budgets are allocated wisely and costs are controlled to safeguard and enhance the organization's financial standing.
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