Breaking News on Data, Development, Deals, and More in the Hospitality Sector
The hospitality industry is witnessing a dynamic shift, with recent data revealing a positive trend in the U.S. hotel market, significant refinancing deals, and exciting new developments across various regions. This article delves into the latest updates, highlighting key statistics, strategic moves by major players, and emerging opportunities in the sector.
Positive Trends in the U.S. Hotel Industry
From July 28 to August 3, the U.S. hotel industry reported encouraging year-over-year comparisons, according to CoStar data. Occupancy rates reached 69.4%, marking a modest increase of 0.8% compared to the previous year. Average Daily Rate (ADR) also saw a slight uptick, rising by 0.6% to $159.63, while Revenue Per Available Room (RevPAR) climbed by 1.3% to $110.84.
Among the Top 25 Markets, Houston stood out with remarkable growth. The city experienced the highest year-over-year increases in occupancy, soaring by 28.1% to 75.8%, and RevPAR, which surged by 45.7% to $93.88. Additionally, both Houston and Philadelphia reported the largest lifts in ADR, each increasing by 13.7% to $123.82 and $161.02, respectively. However, not all markets fared as well; Anaheim and Los Angeles faced steep declines in RevPAR, dropping by 12.0% and 10.7%, respectively.
Braemar Hotels & Resorts Secures Major Refinancing
In a significant move, Braemar Hotels & Resorts has successfully closed a refinancing deal for five of its hotels, totaling $407 million. This new loan features a two-year initial term with three one-year extension options, potentially extending the final maturity to 2029. The loan is structured as interest-only, with a floating interest rate set at SOFR + 3.24%.
As part of this refinancing, Braemar acquired $42.2 million of the most junior tranche of the loan, effectively lowering its net spread on the remaining $364.8 million loan amount to SOFR + 3.01%. The loan is secured by five prominent properties: Pier House Resort & Spa, Bardessono Hotel & Spa, Hotel Yountville, The Ritz-Carlton Sarasota, and The Ritz-Carlton St. Thomas. This refinancing replaces previous loans with higher interest rates, positioning Braemar for enhanced financial flexibility.
Hard Rock International Expands with Reverb in Pensacola
Hard Rock International is set to make its mark in Pensacola, Florida, with the development of the 125-room Reverb by Hard Rock hotel. Scheduled to break ground in 2026 and open in 2029, this property will be the sixth Reverb hotel, joining locations in Atlanta, Hamburg, Kalamazoo, Tampa, and Scottsdale. The Pensacola hotel will be strategically located downtown at Maritime Park along Pensacola Bay, and the development is contingent upon a 100-year ground lease with the city, which is set to be voted on by the City Council on August 8.
Latin America’s Hospitality Construction Pipeline Shows Promising Growth
The Latin American hospitality sector is on an upward trajectory, as indicated by the Q2 2024 construction pipeline trend report from Lodging Econometrics (LE). The region’s expanding construction pipeline currently comprises 612 projects, totaling 97,597 rooms, reflecting an 11% increase in projects and a 10% increase in rooms year-over-year.
As of the end of the second quarter, Latin America has 253 projects under construction, representing a robust 11% year-over-year increase in projects and a 15% increase in rooms. Additionally, there are 187 projects scheduled to commence construction within the next 12 months, up 18% in projects and 17% in rooms compared to the previous year. The early planning stage also shows promise, with a 3% year-over-year increase, totaling 172 projects and 23,802 rooms.
Dusit International Expands Presence in Bangkok
Dusit International is making strides in Bangkok with a new property management agreement with King Square Development Co. Ltd. This partnership will oversee the Dusit Suites Kingsquare, Bangkok, and KingsQuare Residence, an upscale hotel and luxury residential project set to open in 2026. The Dusit Suites will feature 60 hotel rooms and 49 serviced suites, catering to a diverse clientele.
The luxury KingsQuare Residence will also be managed by Dusit Hospitality Services, showcasing a 52-storey tower with 222 residences ranging from one-bedroom units to three-bedroom homes. This development underscores Dusit’s commitment to expanding its footprint in the hospitality sector while providing high-quality accommodations.
Conclusion
The hospitality industry is experiencing a wave of positive developments, from increased occupancy rates in the U.S. to significant refinancing deals and exciting new projects in various regions. As major players like Braemar Hotels & Resorts and Hard Rock International continue to innovate and expand, the future of the hospitality sector looks promising, with ample opportunities for growth and investment. Whether through strategic refinancing, new hotel developments, or expanding construction pipelines, the industry is poised for a vibrant and dynamic future.