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1. US Interest Rates Set To Hit 22-Year High
The U.S. Federal Reserve is likely to raise rates again later today another quarter percentage point to the highest levels in 22 years, the Wall Street Journal reports.
Some investors have held on to hope that the recent cooling of inflation could mean this is the last rate increase for the foreseeable future, but that is not likely to be the case.
"Economic growth has likely been too firm in recent months for Fed Chair Jerome Powell to signal that Wednesday’s increase in the Fed’s benchmark short-term rate will be the last of the current tightening cycle, as investors anticipate," the newspaper reports. "The recent slowdown in inflation also makes it hard for central bank officials to firm up plans for any additional rate increase."
2. Hilton Boosts Outlook After Strong Second Quarter
With a 12.1% year-over-year jump in revenue per available room and $413 million in net income for the second quarter, Hilton is boosting its full-year guidance for 2023, according to the company's latest earnings release. The company is now expecting a full-year RevPAR increase between 10% and 12% with roughly $1.4 billion in net income.
"Systemwide comparable RevPAR continued to expand throughout the quarter, experiencing growth across all of our customer segments and regions, driven by strong preference for our brands," Hilton President and CEO Chris Nassetta said in the earnings release.
3. Industry Experts Dive Into Demand Trends in New HNN Podcast
In the first episode of Hotel News Now's latest podcast — Tell Me More: A Hospitality Data Podcast — CoStar's Jan Freitag and STR's Isaac Collazo dive into how business, group and leisure travel are beginning to normalize and how that looks different across the industry.
"We've hit upon that whole idea of normalization by looking at day-of-week patterns," said Collazo, STR's vice president of analytics. "We knew that weekends and shoulder days were really popping last year and the year before that. And so when you look at the data now and compare it to the same calendar year as 2023, which is 2017, 2006 and 1995, you'll see that everything is coming back to what is a normal level for a shoulder day, what is a normal level for a weekday and a weekend."
Tell Me More is available on Spotify, Apple Podcasts and anywhere else you listen to podcasts.
4. Hiring Push Leads To Bump in Hotel Guest Satisfaction
A hiring surge over the past year has led to a corresponding jump in guest satisfaction, HNN's Dana Miller reports based on the latest J.D. Power data.
The J.D. Power 2023 North American Hotel Guest Satisfaction Index notes satisfaction with hotel staff was up, with 86% of surveyed guests noting no problems during their stays.
“Hotel hiring continues to increase, and leisure and hospitality is the ‘rock star’ among industries reported in monthly U.S. Bureau of Labor Statistics employment figures,” Andrea Stokes, hospitality practice lead at J.D. Power, said in a news release. “This boost in hotel staffing is showing up in the form of high customer satisfaction scores. Staff service is now the highest-scoring factor in this study across all hotel segments from economy to luxury, underscoring the critical role that front-line staff play in defining the guest experience.”
5. Cerberus, Highgate Miss Payments for Courtyard Portfolio
Highgate and Cerberus Capital Management have missed two months of payments on their jointly owned $415 million loan for 30 Courtyard by Marriott hotels, which some industry watchers are regarding as a sign of growing distress, HNN's Trevor Simpson reports.
“The default of the Courtyard by Marriott portfolio took us by surprise,” Barclays Plc analysts Lea Overby and Anuj Jain wrote in a note Monday. “This shortage is due to a large hurricane insurance payment, although only three of the 30 are … located in Florida.”
The two companies have requested an extension on the floating-rate loan.
This is the latest in hotel asset distress, following Ashford Hospitality's Trust plan to return 19 hotels to lenders and Park Hotels & Resorts decision to walk away from two San Francisco hotels with a maturing $725 million loan.
Read more news on Hotel News Now.
Editor's note: Chris Nassetta serves on the board of directors for Hotel News Now's parent company, CoStar Group.