5 things to know: 13 December 2018
5 things to know: 13 December 2018
13 DECEMBER 2018 10:38 AM

From the desks of the Hotel News Now editorial staff:

  • UK PM survives, but Brexit deal still unlikely to pass
  • Workers begin to demonstrate outside California hotels
  • Assessing the hotel industry’s unknowns in 2019
  • US hotel results for week ending 8 December
  • Hotels continue to embrace collaborative workspaces

UK PM survives, but Brexit deal still unlikely to pass: United Kingdom Prime Minister Theresa May survived her vote of no confidence, but only after agreeing to setting an end date to her time in office, the BBC reports. Despite rallying enough support to remain in office, the odds of passing the Brexit deal May negotiated with the European Union have not improved.

May has said she believes she can gain the support of critics by easing their concerns over the “backstop” plan to avoid having manned Irish border, the article states. Critics have said the backstop plan will keep the U.K. permanently tied to the EU’s laws and hurt its ability to make trade deals. However, the EU has stated it will not renegotiate the backstop, although it did add that it would agree to further assurances that it would be temporary.

Workers begin to demonstrate outside California hotels: Roughly 800 employees of hotels in Los Angeles and Orange counties have begun marching and chanting slogans in front of their places of employment, the Los Angeles Times reports. While the demonstrators said the marching was in celebration of the Virgin of Guadalupe for her holiday, they said it was also to put pressure on hotel management following the expiration of their contracts at the end of November.

“This action was to make it clear to the companies that we are ready” to strike, Andrew Cohen, a spokesman for Unite Here Local 11, told the newspaper.

About 7,500 union employees in Southern California voted 96% in favor of an authorization to strike earlier this week. Among many benefits, the workers are seeking $25 an hour, less expensive health care and panic buttons for housekeepers.

Assessing the hotel industry’s unknowns in 2019: Jan Freitag, SVP of lodging insights at STR (parent company of HNN) compiled a list of some of the factors that will affect the hotel industry next year: average daily rate, labor costs, weaponized travel, branding and climate change.

The U.S. hotel industry will end 2018 by having the strongest demand and occupancy levels on record, Freitag writes, but ADR growth remains surprisingly slow.

“Room rate growth has been muted ever since the Great Recession hit,” he writes. “Rolling 12-month U.S. hotel industry ADR in October 2008 was $108. In October 2018, it was around $130. This equates to an increase of around 25%. The consumer price index increased by 16% at the same time. So, yes, our top-line growth outpaced the bottom line growth in 10 years. But between October 2017 and October this year, CPI increased 2.5%, and ADR growth was—wait for it—2.5%. In other words, the increase of profits for this year is basically zero.”

U.S. hotel results for week ending 8 December: Hotels in the United States reported mixed year-over-year results for the week ending 8 December, according to data from STR. Occupancy slipped by 0.8% to 60.4%, but average daily rate grew by 1.3% to $126.45, resulting in revenue-per-available-room growth of 0.5% to $76.38.

Among the top 25 U.S. markets, San Diego reported the largest increase in RevPAR, jumping 33.6% to $122.71 thanks to a 23.7% increase in ADR to $161.86 and an occupancy increase of 8% to 75.8%. Twelve of the top 25 markets reported RevPAR growth during the week.

Hotels continue to embrace collaborative workspaces: More and more hotels are turning their public spaces into communal work areas where guests and locals can gather to work together, or even separately, The New York Times reports.

The Ace Hotel New York is one of the first to embrace this concept, according to the article. The hotel has communal tables, plenty of power outlets, free Wi-Fi, snacks and a bar.

“What we wanted was for our lobbies to act as community gathering spaces and designed them with that in mind,” said Kelly Sawdon, partner and chief creative officer at Ace Hotels. “Our hotels are borne from our love for cities and people, and that means providing space for everyone, regardless of whether they’re guests or our neighbors.”

Compiled by Bryan Wroten. 

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