From the desks of the Hotel News Now editorial staff:
- Värde Partners sells €600-million portfolio to Covivio
- UK hotels see five-year high in insolvencies
- Wildfires, new supply hurt hotel demand in Australia
- Memphis reports hotel building boom
- Fire causes $1.1m damage to German hotel, restaurants
Värde Partners sells €600-million portfolio to Covivio: Europe’s Värde Partners announced it entered into a definitive agreement to sell a portfolio of eight luxury hotels for €600 million ($671.7 million) to European real estate operator Covivio through its subsidiary Covivio Hotels, according to a news release. The eight hotels had been operating under The Dedica Anthology brand since 2018.
The hotels included in the deal are the Palazzo Naiadi in Rome; the Plaza Nice in Nice, France; the New York Palace in Budapest; the New York Residence in Budapest; the Carlo IV in Prague; the Palazzo Gaddi in Florence, Italy; the Grand Hotel Dei Dogi in Venice; and the Hotel Bellini in Venice.
The deal is expected to close in the first half of 2020. Once the deal is complete, Covivio Hotels will have the hotels operate under the NH Collection, NH Hotels and Anantara brands.
U.K. hotels see five-year high in insolvencies: Accountancy group UHY Hacker Young released figures showing that hotel insolvencies grew by 60% year over year in September 2019 in the United Kingdom, The Guardian reports. The total number of 144 individual hotels represents a five-year high.
The country has experienced a drop in business travel thanks to a slowing of the U.K. economy, which led businesses to cut back on spending on conferences and team building trips, the newspaper reports. Overseas tourists visiting the U.K. also dropped by 3% while the number of units available on short-term rental platforms continued to grow.
“The hospitality sector is facing upheaval,” Peter Kubik, partner at UHY Hacker Young, told the newspaper. “Those hotels that are unable to fund-change face being left behind. On top of that, Airbnb is increasing its market share, and not just amongst millennials. Hotels – many of which are lagging behind in their use of technology – are going to have to quickly bring themselves up to speed.”
Wildfires, new supply hurt hotel demand in Australia: Devastating fires in New South Wales, Queensland and Victoria and new supply in major metro markets are causing hoteliers in Australia to cut their rates, HNN contributor Tamara Thiessen reports.
Prior to the fires starting, data from STR showed Australia’s major markets year-to-date occupancy through October 2019 declined 1.3% year over year to 73.8%, average daily rate dipped 1.1% to $183.37 and revenue per available room decreased 2.4% to $185.44. Supply growth (+2.2%) outpaced demand growth (+0.9%). STR is the parent company of HNN.
Dean Dransfield, founder of consultancy Dransfield Hotels & Resorts, is confident about the industry overall, however.
“The sky is not falling in,” he said. “What’s happening in lots of these markets, particularly Sydney and Melbourne, is that occupancies were in the (low) 80s, so supply may be 1% to 2% in front of demand in the year it’s delivered. That’s creating a little downward pressure, but it is taking us only from very high occupancies to still high occupancies, with just a little leveling or reductions in rates.”
Memphis reports hotel building boom: Memphis, Tennessee, has another four hotel projects added to the list of new hotels in the works for its downtown area, USA Today reports. With the addition of the new projects, the number of planned rooms has grown to more than 5,000 across 49 projects.
“They're not all going to get built,” said Chuck Pinkowski, owner of Memphis-based Pinkowski & Company. “But 25 of the 49 are Hilton, Marriott International or InterContinental Hotels Group projects. Those are franchise commitments. Those companies don't make franchise commitments unless they are pretty strong possibilities. There's a lot of them that are going to happen.”
Fire causes $1.1m damage to German hotel, restaurants: A fire destroyed most of the the Traube Tonbach Hotel and its award-winning restaurants in Baiersbronn, Germany, CNN reports. Early estimates report the fire caused $1.1 million in damage. More than 60 people were evacuated during the fire.
Police reported the fire started in the hotel’s historic restaurant wing, the article states. The cause of the fire is still unknown as investigators had not yet been able to enter the building.
Compiled by Bryan Wroten.