U.S. private equity firm KKR’s proposal to take an almost 16% stake in the troubled Spanish chain NH Hoteles could transform the company as it struggles with almost €1 billion ($1. 3 billion) of debt, overexposure in its lackadaisical domestic market for its mostly urban properties and a hide-bound management style, industry experts say.
“NH has long been mentioned as a takeover target since Mariano Pérez Claver took over as president and CEO in February 2011 in representation of Spanish savings bank BFA-Bankia,” said Ivar Yuste, partner at Barcelona-based consulting firm PHG Hotels & Resorts.
NH, Europe´s third-largest business hotel operator with almost 400 properties in Europe, Africa and the Americas, announced the preliminary KKR offer in a statement to Spain’s stock market regulator, saying the private equity firm proposed buying bonds that could be converted into shares and that the board was studying the offer.
A NH spokesman declined to comment on the proposal. A spokesman for KKR operations in Europe also declined comment.
Read “KKR bid for NH could transform Spanish chain.”
Business activity in the U.S. hotel industry went down in November, according to the latest reading of e-forecasting.com’s Hotel Industry Pulse index.
The HIP index declined to a reading of 103.5 in October, following a decline of 0.1% in September. The index was set to equal 100 in 2005. HIP's six-month growth rate, which historically has confirmed turning points in U.S. hotel business activity, had a positive rate of 1.3% in October, following a positive rate of 2.6% in September. This compares to a long-term annual growth rate of 3%, the same as the 30-year average annual growth rate of the industry's gross domestic product.
The probability of the hotel industry entering into recession, which is detected in real time from HIP with the help of sophisticated statistical techniques, registered 15.5% in October, up from the 10.3% reported in September.
The U.S. hotel industry reported increases in all three key performance metrics during October, according to data from STR, parent company of HotelNewsNow.com.
Overall, the U.S. hotel industry’s occupancy rose 2.4% to 64.4%, its average daily rate was up 4.2% to $109.67 and its revenue per available room increased 6.7% to $70.62.
Among the chain-scale segments, the upper-midscale segment experienced the largest occupancy increase, rising 3.2% to 66.9%, followed by the luxury segment with a 3% increase to 77.5%.
The upper-upscale segment led the ADR increases, rising 5.2% to $166.38, followed by the luxury segment (+4.9% to $285.91) and the upscale segment (+4.5% to $121.32).
The luxury segment (+8% to $221.58) and the upper-upscale segment (+8% to $126.81) reported the largest RevPAR increases for the month.
In September, Facebook made a change to its algorithm to decrease spam in users’ newsfeeds and improve their online experience. That change, however, had a significant impact on the reach of brand pages, according to an analysis conducted by GroupM Next and M80.
Although brand-page reach dropped 38%, the percentage of fan engagement following the algorithm change increased. Before the algorithm change, the average percentage of post impressions that resulted in engagement was 0.76%, which went up to 1.49% after the algorithm change.
Read the full results here.
Half of all adults in the largest U.S. cities plan to travel this holiday season, according to new research released Tuesday.
The survey, conducted online by Harris Interactive for Inspirato, polled more than 2,500 adults in Atlanta, Boston, Chicago, Dallas-Fort Worth, Houston, Los Angeles, New York, Philadelphia, San Francisco and Washington, D.C., and found that 49% plan to take at least one personal trip over the upcoming holiday season. Holiday travel is most popular this year among residents in Atlanta (57%), San Francisco (59%) and Washington, D.C. (59%), while residents in Boston (41%), Los Angeles (45%) and Philadelphia (45%) are least likely to report travel plans.
Additional finding include:
Most travelers (72%) plan to visit another state this holiday season; 36% are traveling to another state in a different region of the country. Five percent are traveling to Canada or Mexico, while 8% are leaving North America entirely.
On average, travelers are planning to spend around $1,300 on their upcoming holiday travel, including transportation, accommodations, food and entertainment. Residents in New York are expected to spend about $2,000 on travel this season—the highest figure of any city polled. Atlanta residents plan to spend the least, about $900.
The top reason adults cite for not traveling this holiday season is a lack of funds (47%).
Compiled by Stephanie Wharton.