From the desks of the Hotel News Now editorial staff:
- Blackstone launches first private REIT
- Tsogo Sun buys majority of South African REIT
- Buoyed with Jin Jiang cash, Louvre seeks new direction
- STR releases preliminary US lodging numbers for July
- Quarterly earnings: TUI resilient amid geopolitical turmoil
Blackstone launches first private REIT: Blackstone Group plans to raise $5 billion from investors to begin its first nontraded real estate investment trust, which will be named Blackstone Real Estate Income Trust, Bloomberg reports. The new REIT intends to invest in commercial properties including hotels, apartments and shopping centers.
A Blackstone representative declined to comment beyond confirming the regulatory filing of the REIT Wednesday, according to Bloomberg.
Tsogo Sun buys majority of South Africa REIT: Southern Sun Hotels, owned by hotel and leisure group Tsogo Sun, received approval Wednesday from South Africa’s Competition Tribunal to buy a majority stake in South African real estate investment trust Hospitality Property Fund, according to Business Day. As part of the deal, Tsogo plans to inject 10 hotels valued at 1.8 billion South African rand ($135.4 million) into the REIT for more than 50% of Hospitality Property Fund’s common shares, the news site reported.
The Competition Tribunal approved the deal on the condition that Hospitality Property Fund will retain its executive leadership after the transaction closes.
Buoyed with Jin Jiang cash, Louvre seeks new direction: Approximately 18 months after Chinese conglomerate Jin Jiang International Hotels Group acquired Louvre Hotels Group, the French hotel company is poised for big changes. As part of its new push, Louvre will concentrate on the Chinese market and reposition its Golden Tulip and Campanile brands, according to CEO Pierre-Frédéric Roulot.
“With Jin Jiang’s entry, everything changed,” Roulot said. “It has been unbelievable for us. Jin Jiang is a long-term and strategic player.”
STR releases preliminary U.S. lodging numbers for July: Preliminary July 2016 performance numbers from STR, the parent company of Hotel News Now, indicate the U.S. hotel industry saw flat or decreasing occupancy but increases in both average daily rate and revenue per available room. ADR grew between 3% and 5% while RevPAR increased between 2% and 4%, but occupancy is projected to land between a 2% decrease and flat performance.
Among the chain scales, midscale and economy matched the overall U.S. industry’s projected ADR growth (3% to 5%), while economy led the way in RevPAR with 2% to 4% expected growth. Occupancy among upper-upscale, upscale, upper-midscale, midscale and economy hotels is likely to decline between 1% and 3% in the month of July.
Quarterly earnings: TUI resilient amid geopolitical turmoil: TUI Group revenue dropped by 5.7% to €4.6 billion ($5.1 billion) in the three months ending 30 June, according to the firm’s latest earnings report, but earnings before interest, tax and amortization increased 1.1% to €180 million ($201 million). TUI’s CEO Friedrich Joussen said demand remained resilient and the group was flexible and “confident of delivering at least 10% growth in underlying EBITA in 2015-16.”
In its hotels and resorts division, the company’s underlying EBITA came in at €57 million ($63.7 million), down approximately 15% compared with the same period in 2014-15, with earnings “for hotels in Turkey and North Africa (having) been adversely impacted by reduced demand following geopolitical events.” During the quarter, the group opened five hotels, with another two repositioned into its TUI Blue brand.
Compiled by Terence Baker.