Hotel News Now each week features a news roundup from a different region of the world. Today’s compilation covers Europe.
Europe mostly positive in September
The European hotel industry posted positive results in year-over-year metrics when reported in U.S. dollars, Euros and British pounds for September 2013, according to data compiled by STR Global, sister company of Hotel News Now.
Year-to-date September 2013, the region reported a 2.2% increase in occupancy to 68.2%, a 1.5% decrease in average daily rate to €103.15 ($139.42) and a 0.6% increase in revenue per available room to €70.37 ($95.11).
IHG sees boost in revenue, RevPAR ...
United Kingdom-based InterContinental Hotels Group released its third-quarter earnings on 5 November, which in that quarter saw RevPAR grow by 3.3% (+3.6% in the first nine months); 8,000 rooms open (for a worldwide total of 679,000 rooms); and 16,000 rooms signed in the quarter, up 18% year on year. IHG now has a pipeline of approximately 180,000 rooms at the quarter end.
“RevPAR growth of 3.3% in the quarter was led by a strong performance in our Asia, Middle East and Africa region, up 5.4%,” said CEO Richard Solomons.
… as does Meliá
Palma de Mallorca, Spain-based Meliá Hotels International reported earnings before interest, tax and amortization of €201.3 million ($272.1 million) for the first nine months of the year, up 9.3% compared to the same period in 2012. Net profit, however, fell by 33.6% to €25.4 million ($34.3 million). The decline was due to reduced capital gains and “extraordinary financial items in the period,” the company said in its earnings statement.
In EMEA specifically, Meliá enjoyed RevPAR growth of 11.4% driven by rate increases of 10.8%.
October Europe pipeline
The Europe hotel development pipeline comprises 811 hotels totalling 135,478 rooms, according to the October 2013 STR Global Construction Pipeline Report. The total active pipeline data includes projects in the In Construction, Final Planning and Planning stages but does not include projects in the Pre-Planning stage.
During 2013, 75 hotels with 11,710 rooms are expected to open, led by the unaffiliated segment (17 hotels with 1,599 rooms), followed by the upscale segment (14 hotels with 2,246 rooms) and the upper-midscale segment (13 hotels with 2,394 rooms). The midscale segment is expected to see the smallest number of hotels, with five properties comprising 653 rooms.
Single assets pushing Europe deal volume
According to commercial real estate consultancy Jones Lang LaSalle, hotel investment volumes across Europe, Middle East and Africa reached €8.2 billion ($11.1 billion) in the year-to-date September 2013, a 53% growth compared to the same time last year. Single-asset deals secured a 54% share of transaction volumes overall, up 13% compared to last year.
The most notable single-asset transactions during third-quarter 2013 included the sale of London’s Grand Plaza Serviced Apartments, sold to Federal Land Development Authority of Malaysia for a reported €116.6 million ($157.6 million), followed by Stockholm’s First Hotel Amaranten for €114.7 million ($155 million) and Rome’s Hotel Eden to The Dorchester Group for €105 million ($141.9 million).
Starwood Capital sells Louvre properties
Starwood Capital sold 40 Louvre Hotel properties across France to a range of small investors for an undisclosed sum. The hotels are to be operated under franchise agreements and will continue to trade under the Louvre Hotels banner.
Seemingly no parity
Online travel agencies have the majority of the lowest rates for hotels in a number of European markets, according to an analysis from revenue management consultancy RateGain.
Parity does not exist, apparently, most notably in Amsterdam, Madrid, Prague and Rome. More than 70% of hotels in all categories in these locations show cheaper rates on the OTAs in RateGain’s analysis of pricing data from November 2013 to January 2014.
Deals and developments
- Marriott International plans to open what it claims will be an internationally branded hotel in the former Yugoslavian nation of Bosnia and Herzegovina. The 75-suite Residence Inn Sarajevo, due to open in the country’s capital in late 2014, will operate as a Marriott franchise, owned by SEIC Hospitality and managed by Interstate Hotels & Resorts.
- Dubai-based Jumeirah Group signed a management agreement with IFG Basis Proect LLC for a luxury hotel on Nevsky Prospect in St. Petersburg, Russia. The hotel is under development and is expected to open within the next three years. The 74-room hotel will be converted from Wavelberg House, which dates to 1912.
- InterContinental Hotels Group has signed its second Staybridge Suites property in London. Due to open in early 2015, the 93-room Staybridge Suites London Vauxhall will be managed by Cycas Hospitality and operate under a franchise agreement with new owner Spring Mews Limited.
- The Renaissance, Aix-en-Provence—the sixth Renaissance in France—will open in January 2014. The Marriott-branded property will operate as a franchise with five investors that include two of the project developers, Marc Cohen from Primosud and Stéphane Pérez from Perimmo.
- Hong Kong-based Dorsett Hospitality International has been given the green light on its second U.K. property, to be built in the Aldgate area of London. Dorsett plans to demolish the nine-floor Matrix House, which it bought for £14 million ($22.5 million) in 2012, and replace it with the 13-floor, 275-room Dorsett City, London. (Dorsett’s first U.K. hotel, Dorsett Shepherds Bush, also in London, is due to open in the first quarter of 2014.)
Compiled by Terence Baker.