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Hoteliers respond to the effects of Hurricane Maria

hotelnewsnow.com Featured Articles - 22 September 2017
Areas such as Puerto Rico and the Turks and Caicos islands were devastated by strong winds and damage from Hurricane Maria when it tore through a portion of the Caribbean on Wednesday, 20 September, but other parts of the region, such as Aruba and Jamaica, were not damaged by the storm. Frank Comito, CEO and director general of the Caribbean Hotel and Tourism Association, said 70% of the area was not severely affected and is open for business. He said the view that the entire Caribbean region was devastated by Maria isn’t true. “Over 70% of the hotels are fully operational,” he said, adding that places such as the Bahamas and St. Kitts that were initially hit by Hurricane Irma have “already bounced back.”

Don't be the Equifax of the hotel industry

hotelnewsnow.com Featured Articles - 22 September 2017
The details coming out of the Equifax data breach show some shameful mistakes the hotel industry should learn from, especially as new technology comes out that would collect more data about guests. Forgive me if I sound like a broken record lately, but we’ve all seen two important and somewhat related developments recently, and I think there are some lessons that shouldn’t be ignored by the hotel industry. I hope the data breaches at Equifax made every hotel CEO, president, COO, etc., run over to their IT department to make sure their companies don’t have the same vulnerabilities Equifax had. It appears a software package the company used had a known flaw in it. When the software developer released a patch in March to fix it, Equifax hadn’t applied the patch by May, which is when the company was hacked for what turned out to be the second time in a matter of months. The company recently revealed it was hit with an earlier attack in March.

Owners' views on hotel distribution profitability

hotelnewsnow.com Featured Articles - 22 September 2017
The year 2016 marked a new step in hotel distribution with the active participation in travel of Google, TripAdvisor and others entering the market with instant booking and other transactional models. Here’s our straightforward assessment and actionable guidelines for owners with regards to the management of their room inventory. Asset managers have to be well-versed in the subject to be able to identify potential hidden costs. After all, as owners expect operators to generate direct bookings, management fees are computed on the basis of the “full average daily rate” and not on the “net ADR” (which is ADR minus transaction-related acquisition costs and general acquisition costs, plus ancillary spend).

Guidelines for preventing, handling workplace violence

hotelnewsnow.com Featured Articles - 22 September 2017
To protect themselves, other employees and consumers, employers should prepare for the threat of workplace violence through policies and training, attorneys said. During a webinar titled “The impact of workplace violence as it relates to employment laws and OSHA,” attorneys with law firm Conn Maciel Carey explained that workplace violence can have warnings signs or occur unexpectedly, so it’s important to make sure the company is ready with policies and procedures that can help prevent violence as well as guide employees’ actions should it happen. The federal Occupational Safety and Health Administration developed guidance to help define workplace violence, said Andrew Sommer, partner at the firm. It relates to any act or threat of physical violence, harassment, intimidation or other threatening and disruptive behavior that occurs in the workplace. This includes assault, battery, harassment, intimidation, bullying, threats and active shooter situations.

LatAm attracts more institutional investment

hotelnewsnow.com Featured Articles - 21 September 2017
Investors see opportunities to finance hotels from economy to luxury as markets stabilize. Hospitality is a key sector for investment dollars into South America, and investors and developers see opportunities that range from budget hotels to luxury properties. Speakers at the South American Hotel Investment Conference representing financial institutions and hotel brand companies underscored that while regional differences factor in to where money is spent in tourism in Latin America, overall tourism growth is positive. “We’re very active in the tourist industry because we see it as high growth,” said Rogerio Basso, principal investment officer and head of tourism for Inter-American Investment Corporation. “In the next 10 years, the tourist industry will present the highest growth globally, with 4% growth per year, so it’s attractive.”

Indies navigate operational upsets during renovations

hotelnewsnow.com Featured Articles - 21 September 2017
Hotel renovations at independent properties present industrywide challenges as well as some unique to the indie space for those running the hotels. Renovating a hotel opens up new possibilities for the property, creating a refreshed feel with updated amenities, modern designs, better technology and an overall feeling of renewal. Getting to that point though presents challenges for any hotel, and that’s especially true for independents operating without the support of a brand behind them. Though some hotels will close during renovation projects, many owners choose to keep theirs open, which, while maintaining a source of revenue, creates some challenges for the staff running the property. Operating a hotel under renovation requires foresight and careful coordination with every party involved, sources said. Planning aheadWhen Provenance Hotels began its discussions about when and how to renovate the 85-year-old building housing The Roosevelt Hotel in downtown Seattle over 18 months and convert it into The Theodore Hotel, the parties involved had to determine what would be the impact of the project and what would that look like over time, said Chris Lorino, regional director of operations. The company decided it would take 60 of its 150 rooms out of order in various stages, he said, so the impact on inventory was preeminent during planning.

Credibility key to land financing for Italy development

hotelnewsnow.com Featured Articles - 21 September 2017
Despite chronicled stress on Italian banks, hotel development is possible and finance is available to developers who do their homework and have a solid track record and contacts, sources said. Italy is lagging behind some of its Mediterranean neighbors in terms of hotel projects securing finance and getting off the ground, according to sources. Sources said Italy’s lending uncertainty is affecting the hotel industry by compelling developers, owners and operators to be even more diligent in doing their homework and presenting ironclad business and financing plans. The Italian banking system started experiencing some distress in 2016, and the most notable evidence was the nationalization of its third largest bank, Banca Monte dei Paschi di Siena, which also is widely acknowledged to be the world’s oldest surviving bank.

Employment issues in hospitality: A legal roundup

hotelnewsnow.com Featured Articles - 21 September 2017
Recent legal decisions and legislation could affect hoteliers who have properties in California. As summer turns to fall and the end of the year approaches, here is an overview of some recent legal decisions and legislation that could affect hoteliers with properties in California. The PAGA saga: Expanded discovery rights for plaintiffsThe scope of discovery got a bit broader in California cases brought under the Private Attorneys General Act of 2004. In so-called PAGA actions—by which an employee may pursue a private right of action on behalf of himself or herself and aggrieved third parties against an employer to collect penalties for particular labor violations—an employer is now generally compelled to produce the contact information of its employees when asked for such information by an employee plaintiff. For example, the ruling in Williams v. Superior Court, in which the California Supreme Court determined that the latitude for discovery in PAGA actions (including those brought against hotels and resorts) is essentially the same as that in class actions.

Indies look for flexibility in cancellation policies

hotelnewsnow.com Featured Articles - 21 September 2017
Owners of independent hotels said they’re unlikely to change their policies in light of moves by the major brand companies toward tighter cancellation windows. While several hotel brand companies have had success with stricter cancellation policies aimed at better controlling their guest inventory, owners of independent hotels lean toward more freedom in their cancellation policies, sources said. Dawn Gallagher, chief sales and marketing officer at Crescent Hotels & Resorts, has mixed feelings about the recent cancellation-policy changes at brand companies. Like Hilton President and CEO Chris Nassetta, Gallagher has seen a rise in last-minute cancellations. But, while Crescent monitors it, there currently is no blanket policy for its portfolio, she said. Each hotel within Crescent’s Latitudes lifestyle collection has its own policy, which allows the property to decide what works for its unique selling point, Gallagher said. Some have a 24-hour policy, while others have a 72-hour policy, she added.

Hoteliers chase profits by dropping roomservice

hotelnewsnow.com Featured Articles - 20 September 2017
Hoteliers who’ve recently downsized or altogether eliminated roomservice at their properties are seeing considerable labor cost savings from the shift, as well as robust profits when implementing grab-and-go dining options. Experts said all but the most luxurious hotels will likely make the move in the near future. Roomservice revenue is on the decline—down 3.6% over a trailing 12 month period, according to June 2017 data from Hotel News Now’s parent company STR—while other segments of hotel F&B operations are experiencing modest growth—up 1.5% overall for the same period. Sources explained that in addition to less roomservice being offered, the decline reflects a broader trend of guests simply looking elsewhere, often for quicker, cheaper and more unique options.

Dress to impress guests, even those less-dressed

hotelnewsnow.com Featured Articles - 20 September 2017
Recently, walking down Clark Street (Chicago) to a meeting, a rather well-dressed gentleman and I found ourselves at a crosswalk. The gentleman complimented me on my attire, and I returned the compliment, as he was wearing a beautiful well-cut business suit, and what looked to be a Ferragamo tie. I too was wearing a trim cut suit, with Hermes tie, and matching pocket square. For a moment, we both were looking at a mirror image of a middle-aged business man, wearing the standard “uniform” that nearly everyone wore two decades ago, and feeling we were a lost species.

Is occupancy or rate more important to the bottom line?

hotelnewsnow.com Featured Articles - 20 September 2017
The age-old question for hotels is which performance metric ultimately has a greater impact on profitability: occupancy or rate? For total transparency, I’ll answer this question upfront—there is no right answer. There are too many variables in the industry to make a claim this bold, such as additional revenue streams and general cost control, which are two crucial elements, to say the least.

Staying mindful of your employees' peace of mind

hotelnewsnow.com Featured Articles - 20 September 2017
While it’s a challenging reality, it’s vital that employers understand that stress and anxiety can arise in the workplace. Even today, there is a stigma around the topic of mental health, and employees are fearful to open up about their personal issues and concerns. In an industry wrought with high turnover, long hours and high stress, one humane approach to ensuring a healthy working environment is to look out for each other’s mental health. The only way to combat a stigma that surrounds mental health is by creating a culture that promotes acceptance and transparency.

How the return of convention hotels will affect demand

hotelnewsnow.com Featured Articles - 20 September 2017
After nearly a decade of modest growth, the development pipeline for massive, meetings-oriented full-service hotels is finally back, and in a big way. Several new hotels in this category are set to open in 2018, after three years in which the number was significantly lower. Experts said a host of factors are driving the sudden surge in growth, particularly localized market conditions, as well as the new properties themselves, which are expected to stimulate new demand. Some hoteliers are also seeing an uptick in overall group business, spurred by favorable macroeconomic trends that are currently boosting budgets for corporate events.

3 things to know about the US leisure traveler

hotelnewsnow.com Featured Articles - 19 September 2017
Research presented on a recent Phocuswright webinar shows that the average U.S. leisure traveler is young, affluent and a super-consumer. Here’s what you need to know about U.S. leisure travelers. The average leisure traveler from the United States is a super-consumer between the ages of 18 and 34 who takes about three trips a year and spends $3,019, according to research from Phocuswright. On a recent webinar titled, “The U.S. leisure traveler: Understanding consumer lifestyle behavior,” Phocuswright Research Analyst Mark Blutstein offered insights on the average U.S. leisure traveler and heavy leisure travelers. Here are three takeaways from the presentation.

World Cup expected to spur Russian hotels' rebound

hotelnewsnow.com Featured Articles - 19 September 2017
Hoteliers and experts believe the impact of the World Cup in 2018 well help hotels in Moscow and Saint Petersburg to improve performance, but there is still work to be done in order to surpass numbers seen before the 2013 recession. Hoteliers in Russia’s two biggest cities are hopeful the 2018 FIFA World Cup will boost hotel performance to levels not seen since the collapse of the ruble. Moscow’s hotels ended July with a strong rise in overall performance, as occupancy increased 4.8% (to 66.4%) in comparison with the first seven months of 2016. ADR during that time was up 14.3% in constant currency to $92.85, though in rubles, ADR dropped 2.2%. As a result, RevPAR jumped 19.8% year-over-year in constant currency to $61.68 with only a smaller increase of 2.5% in rubles, according STR, parent company of Hotel News Now.

New accounting standards call attention to OTA revenue

hotelnewsnow.com Featured Articles - 19 September 2017
AHLA’s financial management committee recommends operators and owners understand the details of their agreements with online travel agencies. Starting on 1 January 2018, there will be several changes to the accounting and financial reporting standards that will impact the hotel industry. Owners and operators need to prepare now to ensure these accounting changes don’t negatively impact their bottom lines.

South America 'full of potential' for brand expansion

hotelnewsnow.com Featured Articles - 19 September 2017
While some hurdles continue to make South America challenging for hotel development, many brands are looking to increase their footprint in the region to take advantage of growing optimism. Latin America, and specifically South America, remains an important location for hotel brands expanding in all segments, particularly as they try to take advantage of strong inbound tourism into the region and more stable governments. But even though tourist arrivals into the region are growing at a good rate, international brand executives speaking at the South American Hotel Investment Conference emphasized that challenges remain in regard to performance, supply-and-demand dynamics and other issues. What the numbers sayHotel supply growth across South America (3% in July year to date) still outpaces demand (2.6% over the same period). But STR Area Director for Central and South America Patricia Boo said demand is finally rising in the region, partly due to domestic travel. (STR is the parent company of Hotel News Now.)

HAMA: Owners deal with hurricane fallout

hotelnewsnow.com Featured Articles - 18 September 2017
While many hotels avoided the worst of the damage from hurricanes Irma and Harvey, asset managers speaking at the Hospitality Asset Managers Association Fall 2017 conference said there is still significant work to be done before a full rebound. Hoteliers are continuing to grapple with the effects they’ve seen from hurricanes Harvey and Irma, which struck Texas and Florida, respectively. Speaking at the Hospitality Asset Managers Association Fall 2017 conference, several asset managers said they’re still trying to get the lay of the land in Florida and are starting to work though recovery efforts in Texas.

In UK, coffee and hotel stays go hand in hand

hotelnewsnow.com Featured Articles - 18 September 2017
With the U.K. soon to have approximately 25,000 coffee outlets, there appears to be no end to the love affair consumers have with both coffee and hotels. One does not have to go too far back to a time when it was near impossible to get a cup of coffee in the United Kingdom—at least a decent one, something an Italian could savor. One of the most popular TV advertisements in the 1970s and ’80s was a soap opera-style campaign for an instant, granule coffee, and that was the only type of coffee it was possible to get. Rather in the way olive oil was only sold in the U.K. as a remedy for dried skin, coffee merely was tasteless heat.

De Vere gets new start with Starwood Capital investment

hotelnewsnow.com Featured Articles - 18 September 2017
The De Vere brand has gone through numerous spinoffs, sales, additions and distress but has been relaunched with an investment by Starwood Capital as part of Principal Hotel Company. After De Vere announced Thursday the brand was being relaunched with a £100-million ($135.8 million) investment by Starwood Capital, brand COO Laurie Nicol said the relaunch “signifies a new chapter for De Vere’s rich heritage,” with assets combining traditional British offerings and modern luxury. The De Vere portfolio will be absorbed into Starwood Capital’s Principal Hotel Company and includes 22 properties—all of which are located in the United Kingdom, including five in central London. De Vere’s assets comprise more than 4,000 keys, 662 event spaces and focus on stately home-style properties that collectively encompass 1,200 acres of grounds. “De Vere has been reinvented, a combination of urban properties and rural mansions. These are dynamic properties,” Nicol said.

Spanish resort companies have arrived in urban markets

hotelnewsnow.com Featured Articles - 18 September 2017
Spain-based hotel companies like Meliá, Barceló, Riu and Iberostar have successfully expanded from their key resort product and entered urban markets globally. Over the past 50 years, several major Spanish hotel companies, such as Meliá Hotels International, the Barceló Hotel Group, Riu Hotels & Resorts and Iberostar Hotels & Resorts, have achieved significant global scale and success—but mainly in the resort segment. The tide is turning, however, as they make strategic forays into urban markets. Many of these companies’ brands first expanded from the island of Mallorca into the Spanish mainland and then the Canary Islands in the late 1970s, followed by international growth to Southeast Asia and the Caribbean in the mid-1980s. Then in the 1990s-2000s, these brands grew throughout the Mediterranean, some to European capitals, and into Mexico and Latin America.

Convention center hotels require many tools for success

hotelnewsnow.com Featured Articles - 15 September 2017
Convention center hotels need plenty of support to be successful, including the right funding mechanism, a captive base of business and sound operating fundamentals. But they also need the support of surrounding hotels and the overall community to ensure prosperity, according to speakers at the recent Southern Lodging Summit. The basic formula for a successful convention center hotels includes the obvious—knowing the market and what type of business it can drive, said speakers on the “Convention center hotel impact on the market—does it lift all boats or drain the swamp?” session. “It’s a lot of hotel rooms on any given night that you’re booking, so understanding how you fill that and looking in advance as to how much time it takes to fill that is very important,” said Chad Crandell, managing director and CEO for Boston-based CHMWarnick, which asset manages 14 convention center headquarters hotels (14,500 rooms and 1.1 million square feet of meeting space)—nine of which are publicly financed and five of which are privately owned.

Irma evacuations cause wild swings in hotel performance

hotelnewsnow.com Featured Articles - 15 September 2017
An analysis of STR data for the week ending September 9 shows the impact of evacuations due to Hurricane Irma on hotel markets in the path of the storm as well as the markets where evacuees sought refuge. The pre-emptive response to Hurricane Irma was significant, with approximately 6.3 million people in Florida alone ordered to evacuate, according to CNN. To put that in perspective, Florida’s population was estimated at 20.6 million people in the 2016 census, which means that more than a quarter of the population was under an evacuation order.

Lessons swell as popularity of dual brands grows

hotelnewsnow.com Featured Articles - 15 September 2017
Developers, operators and brands are learning how to adapt as dual-branded hotels become more prevalent throughout the industry, according to speakers at the Southern Lodging Summit. As dual-branded hotels gain momentum in the development community, so too do the lessons learned from these single assets that house two (or more) brands under one roof. Perhaps the biggest lesson, according to Gary Isenberg, president of New York-based LWHA Asset & Property Management Services, is leveraging a position in the market. “One of the reasons we recommend dual branding is if the market can support a 300-room hotel, we believe from a developer’s perspective it’s better to control two brands, two flags than to build one flag and then someone else comes in to bring in another flag,” Isenberg said during the recent Southern Lodging Summit’s “Dual branding—How does it improve profitability?” session. “It somewhat insulates and protects you in addition to the segmentation of brands.”

Are we (finally) hitting the mobile key tipping point?

hotelnewsnow.com Featured Articles - 15 September 2017
Room keys via guests’ personal handheld devices has been the promise from the hotel industry for years now, with relatively little ground-level progress. But is the industry finally moving the needle? Let me know if you heard this one before: Brands and operators across the hotel industry are making a concerted effort to have more hotels allow guests to bypass the front desk by checking in to their rooms via their mobile devices, then using those same devices as the key that unlocks their room. At this point, it’s not a new concept. It’s been the promise of various companies for a number of years, as they tease massive, brand-wide rollouts of new key technologies designed to make the check-in process more simple and streamlined for guests who don’t need, or want, human interaction as soon as they walk on property. At least from a guest perspective, adoption doesn’t seem to be as swift as some would have promised. But as I sit here to write this, I am in a hotel in Southern California that lets me walk right to my room and unlock it with my smartphone.

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