Recent Developments in the Hospitality Industry: Expansions and Transactions
Recent hotel industry news includes Marriott’s plans for luxury camps in Kenya, Hyatt’s tender offer for Playa Hotels & Resorts, and Palladium’s $20 million expansion project in Jamaica. Apple Hospitality’s earnings report reveals steady growth, while Hamilton Point Investments modifies its loan for a Detroit hotel. Tilman Fertitta increases his stake in Wynn Resorts, and Canada reports positive hotel performance in January. The Middle East also sees growth in hotel projects, led by Saudi Arabia and Egypt.
Marriott International is set to enhance its footprint in Kenya by adding two luxury tented safari camps in partnership with the Lazizi Group of Companies. The Ritz-Carlton, Masai Mara Safari Camp, comprising 20 keys, will open in August 2023, while the JW Marriott Mount Kenya Rhino Reserve Safari Camp, also featuring 20 keys, is slated for early 2026. These developments will mark Marriott’s second and third luxury safari camps in the country. With these additions, Marriott now operates seven properties in Kenya, offering over 1,100 rooms.
In corporate developments, Hyatt has initiated a tender offer for shares of Playa Hotels & Resorts, having received preliminary proposals for the purchase of Playa’s owned real estate assets. Analyst Michael Bellisario from R.W. Baird expressed optimism, stating, “We are incrementally positive – any progress or indication that Playa’s real estate could be sold sooner rather than later is a positive development.” The tender offer expiration is set for April 25, 2024, with a total deal valuation of $2.7 billion, requiring at least 80% of shares to be tendered.
Meanwhile, the Palladium Hotel Group and Grupo Empresas Matutes are embarking on a $20 million expansion of Grand Palladium Hotels & Resorts in Montego Bay, Jamaica. This project will add over 948 new rooms to the current capacity of 1,049 across the two resorts, namely Grand Palladium Lady Hamilton Resort & Spa and Grand Palladium Jamaica Resort & Spa.
Apple Hospitality REIT, based in Richmond, Virginia, reported year-over-year RevPAR growth of 2.7% for Q4 2023 and 1.4% for the full year, benefiting from rising business transient demand. The company recorded an average daily rate (ADR) increase of 1.7% in Q4 and 2.6% higher occupancy rates. In 2024, Apple added two hotels and sold six properties, resulting in a total gross sale of approximately $63.4 million and a gain of roughly $19.7 million.
Hamilton Point Investments from Old Lyme, Connecticut, has secured an undisclosed loan modification for the 241-key Hotel Indigo Detroit Downtown, facilitated by CooperWynnCapital. This adjustment will enable HPI to uphold its existing loan while replacing historical costly covenants.
Tilman Fertitta, operator of the Golden Nugget in Las Vegas, has become Wynn Resorts’ principal shareholder with a newly reported stake of approximately 12.6 million shares, surpassing the 10% threshold. This development positions Fertitta as the largest individual stakeholder in the company after increasing his previous stake to 9.9% in the preceding year.
In January, Canada’s hotel industry documented favorable performance, attributed to room rate growth, as revealed by CoStar data. The overall occupancy rate reported was at 49.8%, with an average daily rate (ADR) of CAD180.04, and RevPAR reaching CAD89.60. British Columbia led with a 52.9% occupancy rate among provinces, whereas Calgary recorded the lowest occupancy.
The Middle East hotel pipeline, according to Lodging Econometrics data, shows Saudi Arabia and Egypt as leaders with a total of 619 projects comprising 155,428 rooms, indicating a continuous growth spurt in project numbers. Currently, 301 projects involving 80,431 rooms are under construction, with expectations of significant new openings projected for the years 2025 and 2026.
Additionally, Radisson Hotel Group has signed on the Era Hotel Bhubaneswar, which will join Radisson Individuals and is expected to open in late 2025.
In summary, the latest developments in the hospitality sector highlight key expansions and corporate initiatives, including Marriott’s luxury camps in Kenya, Hyatt’s tender offer for Playa Hotels & Resorts, and Palladium’s project in Jamaica. Other notable updates include Apple Hospitality’s growth, loan modifications by Hamilton Point Investments, and Fertitta’s new stake in Wynn Resorts. These movements underscore a dynamic and evolving hotel industry landscape across global markets.
Original Source: www.hotelinvestmenttoday.com
