Article Summary:

From the desks of the Hotel News Now editorial staff:

  • Hurricane Dorian moving toward Florida
  • A look at what’s needed in a tight labor market
  • Weekly performance for hotels in the US
  • CBRE: US performance to decline in 2020, rise in ‘21
  • The evolution of flagship properties

Primary Category: 5 Things to Know

Secondary Categories: News

Hurricane Dorian moving toward Florida: Puerto and the U.S. Virgin Islands saw less damage than expected from Hurricane Dorian, but the storm is now heading toward Florida, where forecasters predict the hurricane could grow into a Category 3 storm, Fox News reports.

Meteorologist Glenn Richards of Fox 35 in Orlando said if the storm stays on its current track, it could be “the strongest hurricane to hit Central Florida in over 30 years.”

“As the storm barreled across the Caribbean, people in Florida were starting to get ready,” according to the news outlet. “Local and county governments were distributing sandbags and many residents were rushing to stores for water, canned foods and emergency supplies.”

A look at what’s needed in a tight labor market: Contract labor is a necessary yet costly expense for hoteliers, but there are steps companies can take to mitigate the pain of those costs, writes HNN’s Sean McCracken and Danielle Hess.

Amanda Chivers, managing principal of asset management firm Crown Hospitality Consulting, said contract labor isn’t ideal, but it can’t really be avoided.

“It’s really creating more demand for contract labor,” she said. “Look at resorts; 70% have to rely on contract labor. Imagine how that impacts your bottom line and profitability.”

Weekly performance results for hotels in the U.S.: The U.S. hotel industry reported positive year-over-year results in the three key performance metrics for the week ending 24 August, according to data from STR, parent company of HNN.

Compared to the week of 19-25 August 2018, hotels in the U.S. saw occupancy increase 0.8% to 70.1%, average daily rate rose 0.5% to $128.57 and revenue per available room increased 1.2% to $90.08.

Orlando reported the largest increase in RevPAR (+18% to $72.85), which was helped by the only double-digit rise in ADR (+10.3% to $107.43). The second-largest occupancy increase was also reported in the market (+7.0% to $67.8%).

Nashville reported the largest drops in all three performance metrics: occupancy (-9.4% to 71.8%), ADR (-7.3% to US$139.43) and RevPAR (-16.0% to US$100.11).

CBRE: U.S. performance to decline in 2020, rise in ’21: CBRE’s September edition of its Hotel Horizons forecast shows that RevPAR changes for this 2019 and 2020 have been revised down slightly, but the outlook for 2021 has improved, according to a news release.

“Changes in various components of the U.S. economy and their relationship to U.S. hotel demand fluctuations are well-understood. This is what drives the econometric model that informs our forecasts for U.S. lodging market performance,” Mark Woodworth, senior managing director, CBRE Hotels Research, said in the release. “As a result of the rapidly changing prospects for the nation’s economy, we have adjusted our forecasts of lodging demand and ADR appropriately.”

For the second half of 2019, GDP growth is expected to average 1.9%, which is half the pace of growth seen in the first half of the year. The pace of demand growth is expected to slow to 1.4% for the rest of the year, according to the release. As a result, the company predicts national occupancy will decrease by 0.2% from 2018 to 2019.

The evolution of flagship properties: The hospitality landscape has become a bit saturated, but flagship hotels are still important. “Flagships give operators the opportunity to put on a show, offering innovative designs, services and amenities,” reports The New York Times.

One well-known flagship property is W Hotels’ first property, the W New York, which opened in 1998 and was “the epitome of cool,” according to the news outlet. It had a lobby that functioned as a lounge and called the pool a wet deck, and today, that brand continues to build “shinier, more attention-grabbing flagships.”

W Dubai – The Palm, which opened in February, has glass tiles that reflect the sun, guestroom walls “designed to mirror the sea and Arabic lyrics written graffiti style,” the NYT reports.

Compiled by Danielle Hess.

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Headline: 5 things to know: 29 August 2019

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