5 things to know: 30 May 2019
5 things to know: 30 May 2019
30 MAY 2019 9:14 AM

From the desks of the Hotel News Now editorial staff:

  • Marriott, Hilton, Wyndham lead North America room counts
  • CBRE: US Hotel performance to continue gradual slowdown
  • Quality Inn, a brand of firsts, marks 80th year
  • Amid trade war with China, US sees decline in Chinese tourism
  • Hotel industry at ‘crosshairs of extreme weather events’

Marriott, Hilton, Wyndham lead North American room counts: Census data from Hotel News Now parent company STR shows that the portfolios of three hotel companies—Marriott International, Hilton and Wyndham Hotels & Resorts—exceeded half a million rooms in North America.

As of 28 May 2019, the companies with the largest hotel room counts among the U.S., Canada and Mexico were Marriott (886,308 rooms), Hilton (703,238) and Wyndham (546,716), according to STR data. In the same region, two brands had more than 200,000 rooms in their existing supply—Hampton by Hilton (227,581) and Holiday Inn Express by InterContinental Hotels Group (203,792).

CBRE: U.S. hotel performance to continue gradual slowdown: Decelerating U.S. GDP and concentrated hotel supply are expected to contribute to a continued slowdown of U.S. hotel performance over the next three years, according to CBRE Hotels Research’s latest Hotel Horizons report.

A forecast by CBRE’s Econometric Advisors projects U.S. GDP will decelerate from a 2.2% increase in 2019 to increases of just 0.7% in 2020 and 1.4% in 2021. Annual growth rates for U.S. hotel demand are expected to follow, on a typical one-year delay, from a 2% increase in 2019 to 1.1% in 2020 and 0.1% in 2021.

On the issue of oversupply, meanwhile, CBRE adviser and Cornell University School of Hotel Administration professor Jack Corgel said: “While our forecasts for national supply growth from 2019 through 2022 exceed the STR long-run average of 1.8%, the new hotel rooms are concentrated in just a few markets. Therefore, most markets will realize limited increases in new competition and likely won’t experience a meaningful slowdown in performance.”

Quality Inn, a brand of firsts, marks 80th year: Choice Hotels International’s flagship midscale brand, Quality Inn, got its start as an association called Quality Courts, and in its 80-year history has led the way on many now-widespread hotel industry practices, reports Hotel News Now’s Danielle Hess.

As Quality Courts United in 1941, the brand became the first hotel chain in the U.S. Quality Inn is also known as an early adopter of wall-to-wall carpeting, non-smoking rooms and 24-hour front-desk service, sources said.

“We are trendsetters,” said Tim Shuy, VP of owner and portfolio strategy at Choice. Quality has “always changed with guest needs. It’s not like we are getting along to get along, we’re actually pushing the envelope for that segment. As (guest needs evolve), we evolve.”

Amid trade war with China, U.S. sees decline in Chinese tourism: National Travel and Tourism figures, based on U.S. Customs forms, show travel from China to the U.S. fell 5.7% in 2018 to 2.9 million visitors, the first year-over-year decline since 2003, the Associated Press reports.

“Friction between the U.S. and China is one reason for the slowdown,” the news agency reports. “The Trump administration first imposed tariffs on Chinese solar panels and washing machines in January 2018, and the trade war has escalated from there.”

The U.S. Travel Association fears the impact on Chinese travel to the U.S. will worsen if trade skirmishes between the two countries continue, according to a news release.

“The difficulty with trade skirmishes is that the unintended consequences are hard to predict, and we were concerned from the start that tensions with China might affect business and other travel to the U.S.,” said Tori Barnes, USTA’s EVP of public affairs and policy, in a statement.

“The irony is that travel exports have been the greatest success story of our trade relationship with China, generating a $30-billion surplus and accounting for 19% of all our exports to that country in 2017. The Chinese visit the U.S. in strong numbers, and they spend an average of $6,700 per trip—about 50% more than the average international visitor.”

Hotel industry at ‘crosshairs of extreme weather events’: As the U.S. enters another hurricane season, a report by Curbed asks: “Are waterfront hotels ready for climate change?” The answer seems to be no, and the risk to the hotel industry is tremendous.

STR’s VP of Lodging Insights Jan Freitag and Analytics Manager Claudia Alvarado laid out an extreme, but no longer impossible, scenario in a research article for Hotel News Now in March. “One in three hotels is located in an area that would be impacted by a surge of water six feet above the high-water mark,” Freitag wrote. “And, no surprise, 100% of hotels in Hawaii would be impacted by such an event.”

Rohit Verma, a professor at Cornell University’s SC Johnson College of Business, told Curbed that hotel industry preparation should include “better risk management systems in place, better and more expansive insurance, buildings that can withstand climate risk, and even alternative revenue models when this unpredictable weather wipes out a big part of a hotel’s busy season.”

Compiled by Robert McCune.

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