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1. Hyatt Closes $1.07 Billion Sale of Hyatt Regency Orlando
Hyatt Hotels Corp. sold the Hyatt Regency Orlando for $1.07 billion, capping its years-long commitment to sell owned real estate and hitting $2.6 billion in gross proceeds over the past three years, the company announced. RIDA Development Corp. and Ares Management are buying the property — the fourth largest in Hyatt's system — while signing a long-term management agreement to keep it a Hyatt Regency.
A portion of the 45 acres included in the deal will be used to develop the 2,500-room Grand Hyatt Orlando, eventually bringing the combined complex to more than 4,000 rooms.
“We are extremely pleased to be partnering again with Ares in this historic transaction," Hyatt President and CEO Mark Hoplamazian said in the news release announcing the deal. "We are excited to work with Hyatt to grow and enhance the Orange County Convention Center district and create a guest experience unparalleled for both group and leisure customers. We look forward to collaborating on a visionary public-private partnership with the State of Florida, Orange County, the OCCC, and all community stakeholders.”
2. Sonder and Marriott Sign Licensing Agreement
Marriott International has signed a long-term licensing agreement with short-term rental platform Sonder Holdings to add more than 9,000 rooms to Marriott's portfolio by the end of the year and add 1,500 more to the company's pipeline under the banner "Sonder by Marriott Bonvoy."
For the past decade, Sonder has operated "apartment-style accommodations and small boutique hotels in urban markets," according to the news release announcing the deal. Full integration into Marriott's platform isn't expected to be completed until 2025, but Bonvoy members will be able to earn and redeem points at 200 Sonder properties by the end of the year.
3. Recession Odds Shrinking, Goldman Sachs Says
In the latest sign that the U.S. economy could be headed for the long-hoped-for "soft landing," Goldman Sachs has curtailed the possibility of a recession in their forecast from 25% to 20%, CNBC reports. The firm held its odds of a recession at 1% for roughly a year, but apparently found new reason for optimism in a worse-than-expected July jobs report.
Goldman forecasts have seen "no sign of a recession" in the data released this month.
“Continued expansion would make the US look more similar to other G10 economies, where the Sahm rule has held less than 70% of the time,” Goldman economists said.
The news outlet defined the Sahm rule as: "a historical indicator showing that the initial phase of a recession has begun when the three-month moving average of the U.S. unemployment rate is at least half a percentage point higher than the 12-month low."
4. Government Per Diem Increase Expected To Give Hotels Windfall
The American Hotels & Lodging Association is applauding the U.S. General Services Administration's $3 increase to per diem lodging expenses, noting the move could lead to $100 million in new revenue for the hotel industry in fiscal year 2025, HNN's Bryan Wroten reports.
Starting on Oct. 1, the lodging per diem rate for federal agencies will increase to $110 from $107. Reimbursement for meals and incidentals also increased for the first time since 2022. The standard rate range has been revised from $59 to $68. The non-standard tiers have been revised from $59 to $79 up to $68 to $92.
“Government travel is a vital source of revenue for hotels, and it’s critically important that the federal government’s per diem rates reflect market conditions and take into account the economic realities hotels are facing, including the lingering effects of inflation and the nationwide workforce shortage,” AHLA Interim President and CEO Kevin Carey said in a statement.
5. Democratic National Convention Kicks Off in Chicago
Hoteliers in Chicago are expecting to see an uptick in demand from the Democratic National Convention, which starts today, but also are seeking to head into the event with "realistic expectations" due to the high supply and size of the market, HNN's Bryan Wroten reports.
Jenna Fishel, senior vice president of commercial strategies for Chicago-based First Hospitality, said her company has been carefully planning since it was first announced the convention was coming to Chicago.
"It's a new event, but with the major supply in Chicago, it takes a lot to produce extreme demand in the city," she said. "We tried to set realistic expectations a year or so ago."