From the desks of the Hotel News Now editorial staff:
- Sorenson acts to placate Chinese anger
- Hotel stocks show big 2017 growth
- US hotel construction on the decline
- German Commerz Real buys first assets from €2 billion fund
- IHG exits Nigeria
Sorenson acts to placate Chinese anger: Marriott International CEO Arne Sorenson published a statement to placate Chinese government anger over two recent incidents. Sorenson said Marriott apologized for “incorrectly labelling certain regions within China, including Tibet, as countries in a drop-down menu on a survey (Marriott) sent out to … loyalty members; and second, in the careless ‘like’ by an associate of a tweet that incorrectly suggested (Marriott’s) support of this position.”
China regards Tibet and Taiwan as not being separate entities but part of China. In his apology statement, Sorenson wrote, “We don’t support anyone who subverts the sovereignty and territorial integrity of China and we do not intend in any way to encourage or incite any such people or groups. We recognize the severity of the situation and sincerely apologize.”
Sorenson said a full investigation will be undertaken. According to the BBC, Chinese authorities have shut down Marriott’s Chinese websites for a week as a penalty.
Hotel stocks show big 2017 growth: Stocks in hotel industry C-corps firms had an excellent 2017, drastically outpacing broader markets, while hotel real estate investment trusts saw more modest growth, according to Hotel News Now’s Sean McCracken.
The Hotel Stock Index’s brand subindex was up 49.9% for full-year 2017, with top performer Marriott International up 64.2%, but sources added that while there’s a lot of optimism for hotel stocks heading into 2018, growth rates—across the board—are likely to be moderate.
U.S. hotel construction on the decline: The number of hotel rooms under construction in the United States has declined or remained flat year over year for October, November and December, according to pipeline data from HNN parent company STR.
Overall, there were 179,979 rooms in construction across 1,400 hotels in December. The number of rooms represented a 3.7% decrease compared with the same month in 2016. That decline followed a flat November (+0.6%) and October (-0.1%), and was the largest year-over-year room construction decrease in the U.S. since September 2011 (-7.8%).
German Commerz Real buys first assets from €2 billion fund: German investment fund Commerz Real Capital-Management Company has written the first check out of its €2 billion ($2.4 billion) CR Institutional Hotel Fund, buying two assets in Australia for approximately €50 million ($59.95 million) from Singapore-based CDL Hospitality Trusts.
Both assets come from the AccorHotels’ stable, a 218-room Ibis and a 194-room Mercure, both in Brisbane, Australia. Both will be “operated by a wholly-owned subsidiary of the Accor Group.” Commerz said it would invest the remaining money into global assets.
IHG exits Nigeria: InterContinental Hotels Group is exiting from Nigeria, Africa’s most-populous country, following disagreements with investors as to how to bring its property there, the 358-room InterContinental Lagos out of receivership, according to Hospitality Ireland.
The report stated that last May a Nigerian court ordered one of the asset’s lenders, Skye Bank, to take the property over from owner Milan Group concerning “debts of $29.8 million.” Reputedly, the IHG flag will come down from the property on 18 January. Abu Dhabi-based firm Etisalat “gave up a 45% stake” in the hotel last June.
Compiled by Terence Baker.