CBRE Hotels - 16 October 2017
Unfortunately, 2016 was a disappointment. Revenue and profits increased, but not at the levels that were budgeted. Occupancy and average daily rate (ADR) growth fell short of expectations, which led to a revenue shortfall. While the lower occupancy levels resulted in less expense growth, it was not enough to offset the limited revenue growth. Therefore, the goals for increases in profits were not met.As general managers, controllers, and directors of sales prepare their budgets and marketing plans for 2018, we present the results of our most recent look at the budgeting accuracy of U.S. hotel operators. From CBRE Hotel's Americas Research's Trends in the Hotel Industry database, we identified 629 operating statements that contained both actual and budgeted data for 2016. Using these statements, we compared the revenues and expenses projected for 2016 with what was actually earned and spent during the year.Budget Accuracy FallsSince 2001, CBRE Hotels' Americas Research has assessed the accuracy of hotel budgets. Over the past 16 years, one trend has become predictable. During times of industry prosperity, hotel budgets are more accurate than during industry downturns.During the historical years of growth, hotels beat their budgeted revenue goals by an average of just 0.5 percent, while profit goals were exceeded by 1.4 percent. For the purpose of this analysis, profits are defined as earnings before income taxes, depreciation and amortization (EBITDA).Given this historical trend, along with forecasts for a continued healthy environment for travel, 2016 budgets had the potential to be very accurate. Unfortunately, accuracy slipped during the year. The hoteliers in our sample forecast a 4.1 percent increase in total operating revenue for 2016. Unfortunately, revenues grew by just 1.9 percent during the year, for a miss of 2.2 percent.On the bottom-line, hoteliers projected a strong 7.9 percent gain in EBITDA. Ultimately, the revenue deficit was too much to make up. EBITDA at the properties in our sample increased by a modest 3.8 percent, or a budget deficiency of 4.1 percent.Expense Gap Less Than Revenue ShortfallThe shortage in revenue was the result of budget gaps in both occupancy and ADR. For 2016, the hotel managers in our sample forecast a 1.2 percent occupancy gain along with a 4.1 percent increase in ADR. At the end of the year, however, occupancy for these properties remained flat, while ADRs grow only 2.2 percent.The net result was a full three-point budget deficit in rooms revenue, which contributed significantly to the 2.2 percent shortfall in revenue. Given the magnitude of the gap in rooms revenue, it can be assumed that the budgeted changes in other hotel revenues were more accurate.By accommodating fewer rooms than budgeted, the hotels in our sample did incur less expense growth than planned. During 2016, expenses at the properties in the study sample increased by 1.1 percent. This is 1.6 percentage points less than the budgeted expense growth rate of 2.7 percent.What To Budget for 2018According to the September 2017 edition of Hotel Horizons, CBRE Hotels' Americas Research is projecting that a 2.4 percent increase in RevPAR will lead to a 2.3 percent gain in total hotel revenues during 2018. Concurrently, operating expenses are forecast to rise by 2.6 percent, leading to an improvement in profits of roughly 1.8 percent.On the one hand, the positive market forecast indicates that the odds are favorable for U.S. hotels to achieve their budgeted targets in 2018. However, given the modest gains expected for both revenues and profits, the softness of the 2018 forecast could contribute to budget deficits during the year. Pressure from owners makes it difficult for hotel managers to prepare conservative budgets. Let's just hope any inflated expectations for revenues and profits that might be contained in the 2018 budgets are not too exaggerated.
The Business of Travel - The official blog of GBTA - 16 October 2017
When reading the American Conservative Union’s (ACU) recent op-ed in The Hill, “’Conservative’ air traffic control bill fails to privatize industry”, I couldn’t decide if ACU’s opposition is a good thing. ACU’s support hinges on its “Seven Principles of Privatization,” essentially a guide for lawmakers to privatize for the sake of privatizing. Broad-brush principles seldom make for good policy, and as much as we would like to boil complex problems down to seven words or principles, it simply doesn’t work. But the ACU makes a good point – the 21st Century AIRR Act is not privatization. It’s a detailed prescription for a larger goal: improving our nation’s air traffic control.
Magnuson - 16 October 2017
The first thing to do, is work out your investment budget. It'll help you understand the limits and possibilities of what can be achieved, as well as ensuring you have a top figure in mind when you approach suppliers and contractors. The second key area that should influence your hotel investment plans is your typical customer. What a hotel geared towards businesspeople would benefit from investing in and one that's aimed at young people road tripping will be vastly different. Understanding what your customers or the market segment you want to attract want is crucial.Fortunately, there are some areas that you can invest in that will appeal to a broad range of groups. Choosing to improve your value proposition with these investments could lead to improved customer satisfaction and more reservations being made.WiFi - There's no denying that WiFi has become a huge necessity for many people. If connectivity throughout your hotel isn't great, it's well worth spending the time to come up with a better approach. It'll appeal to pretty much anyone travelling, from families with young children through to business travellers.Bedding - If your bedding is a little worn and the linen isn't looking as fresh as it used to, it's definitely time to invest. After all, guests book your hotel to spend the night, they want to be as comfortable as possible. Breathable fabrics, plump pillows, and warming colours are the way forward.Look outside - It's easy to think that it's just your rooms that matter but that's not the case. Your outside is what customers see first. Cleaning up and renovating your building is a great way to give it a fresh look. If you have a tidy, attractive outdoor space for guests to relax you'll attract more clients too.Check in with your guests - This might be an ongoing invest but once it's an established practice it'll become a streamlined process. Don't wait for your guests to tell you if there's a problem, instead, check in with them during the stay and see where you can help. It's also the perfect opportunity to get to know your market better. It'll cost you in terms of man power but it's a worthwhile investment.Something special - If customer satisfaction is important to you - and it should be! - adding something special to each room can really help. From a glass of wine as they arrive to some light snacks, it can really make you stand out when hoteliers are continually competing. It's likely to be something that they mention as they chat to family and friends or leave a review too.
TFG Asset Management - 16 October 2017
"Valued Added Tax" (VAT) is an indirect consumption tax added to the price of goods and services at the time of purchase. Although the VAT is added at every stage of the supply chain, the final consumer of the good or service ultimately bears the burden of the tax. The UAE taxation rate of 5% remains relatively low in comparison to other countries that have implemented the system. According to KMPG's "2016 Global Tax Rate Survey", the average global VAT rate was 15.64%, with Hungary taxing the highest rate of 27%.Given that the hospitality sector is not exempt from VAT, as asset managers at TFGAM, we need to be prepared to adapt and implement new guidelines. With Travel & Tourism being one the most important sectors in the UAE (comprising 12.1% of GDP in 2016 according to the World Travel & Tourism Council), it is important to understand the implications the introduction of VAT will have. The asset manager needs to ensure that performance is not affected and to prioritize the owner's returns, simultaneously ensuring that the transition process for our operating partners and team is carried out in the most efficient way possible.From an owner's perspective we need to make sure we mitigate any negative effects on our bottom line. Some hotels might choose to absorb this cost, which would directly affect their profitability while others may decide to add the VAT to their final price. In any case, the asset manager needs to assess the implications and be able to understand the impact of VAT on revenue projections and how it is influenced by this increase in cost.Asset managers function as the link between hotel operators and hotel owners. The asset management team needs to assist the hotel operator, providing the right support to analyse and understand the implications of VAT on their day-to-day internal operations.The introduction of VAT will impact the hotel's standard operational procedures. It will require asset managers to regulate all procedural changes introduced in response to the implementation of VAT and prepare to react to conditions which are specific to their industry.The primary measures and considerations that we will have to assess include the following:Update all accounting methods/systems to include VATAccounting systems need to be updated and the finance teams need to be properly trained to comply with the new standards. The introduction of a new tax requires documentation to be filed accurately and diligently. Complying with VAT is a time consuming task, as exemplified by a study conducted by PWC which discovered that on average, it takes 125 hours of work per year to comply with VAT standards and this timeframe can vary greatly per region.Confirm with Property Management System (PMS) that VAT is incorporatedThe PMS shall be updated accordingly. Most of them are regulated by international companies that are familiar with VAT, which should ease the process.Analyze all existing contracts (VAT-registered suppliers)In order to recover VAT, the procurement department shall ensure that all suppliers are registered and compliant with the VAT system. Also, we need to monitor the potential increase in the price of their goods.Staff training and awarenessStaff will have to be trained on new Standard Operating Procedures (SOP) in order to offer the right VAT treatment according to the situation. In particular, training the accounting and finance departments should be emphasized.Confirmation of any changes with external stakeholdersAll reporting modifications need to be explained to stakeholders, especially as cash flows will be affected due to the time interval between a purchase and the VAT refund.Identify any internal transactionsCompanies with subsidiaries or affiliates will have to verify new taxation policies as transactions occur between them.Create clear refund procedures for VATAs explained before, the tax burden is always on the final consumer so intermediaries and suppliers need to ensure refund procedures are in place to claim any VAT previously paid. Receiving a VAT refund can take up to a year or more in some markets, as due diligence is put into practice by the government.The hospitality sector is an area where certain specificities could lead to a more complex re-structuring, whereby the support from the asset management team is key. One of these conditions concerns the regulation of the place and time of sale in order to claim the VAT. Early bookings, cancellations, tour packages, online reservations etc. makes this harder than in other industries. This is because the procurement and consumption of a product can occur at different times and in some cases, through a different entity than the actual consumer.Well established management and good planning can help business anticipate these conflicts and regulate activities appropriately. Once VAT has been introduced, businesses can then further analyze any changes in consumer behavior and trends in demand growth. However, at this stage their main focus will be to establish new procedures and regulations in order to be fully prepared for the rate introduction next year. The role of the asset manager is to ensure these changes are smoothly introduced and act as intermediary between the business and all the stakeholders.
skift.com - Destinations - 14 October 2017
President Donald Trump says those challenging the latest version of his travel ban in court can’t see a report explaining why he targeted immigrants from seven nations because it’s secret. The government on Friday told a Hawaii federal judge who demanded disclosure of the report that it’s classified and should remain off-limits as evidence in the court battle. That judge blocked a previous version of the president’s immigration restrictions amid a fierce debate over national security and discrimination.
skift.com - Destinations - 13 October 2017
A federal judge has granted Washington state the opportunity to challenge the third and latest travel ban announced by President Donald Trump. U.S. District Judge James L. Robart on Thursday granted Washington Attorney General Bob Ferguson’s request to lift a stay that had halted the state’s case. Lifting the stay gives Ferguson and five other states involved in the case — Oregon, Maryland, Massachusetts, New York and California — the chance to challenge the latest ban before it takes effect Oct. 18.
JMBM - 13 October 2017
In evaluating what you should do about the new furor over mandatory hotel charges, it would be helpful to have a clearer understanding of what the FTC seems to be saying on the issue. The chart below is our translation into "street English" of the FTC pronouncements discussed earlier. (See How Resort Fees became an explosive $2.7 billion issue which contains links to the original FTC press release of November 29, 2012 and the most recent FTC Economic Analysis of Hotel Resort Fees of January 2017.)We believe we understand what the FTC is saying. We may not agree with it. We do not know whether the Trump administration will rein in the FTC on its perceived mission regarding resort fees, and we do not know whether the current FTC position will be upheld as a valid interpretation of the law. However, courts normally accord great deference to the interpretation of agencies charged with administering their laws, and it is imprudent to ignore the FTC's recent actions.In weighing options, even if they ultimately win on legal issues, hoteliers should also consider the negative effects of litigation -- including direct costs in terms of legal fees, senior management time, and good will. And there are a number of worrisome plaintiffs who may pursue the issue, including the FTC, State Attorneys General, other governmental and consumer groups, and class action plaintiffs' lawyers. Any victories by the hotel industry may be largely offset by the costs to obtain them.So what are your options on mandatory Resort Fees?The basic thrust of the actions by the FTC, the investigation by the State Attorneys General and most consumer class action suits is that it is a deceptive and misleading business practice for hotels to advertise their room rate online unless the first and most prominent price given includes all mandatory Resort Fees and other charges. They say that it is not sufficient to give the room rate and then have a less prominent disclosure of additional charges.The issue here is really about what disclosure must be made and how it should be made if you charge mandatory fees that are not included in the room rate you quote in advertising and online.For the sake of argument, let's say that the FTC position expressed in the January 2017 analysis was "the law" or that for business reasons you want to develop policies and procedures for Resort Fees that should avoid these Resort Fees issues. The following matrix provides a general guideline as what to options or approaches you might take and the corresponding disclosures.Key terms used in the matrixIn the matrix below, "Fees" is used as a shorthand expression for all mandatory fees and charges, i.e. resort fees, service fees, amenity fees, surcharges or other non-optional charges to the guest which are not included in the quoted room rate."Total Price" means the total of room rate plus any mandatory fees or charges as a single sum. For these purposes, Total Price does not include applicable taxes because we are not aware of any claim that taxes are a necessary part of price disclosure, although one can imagine such a claim being made. Taxes are distinguishable from other Fees or charges for services in that they are a direct pass through of governmental impositions which must be paid over to third parties, they are not at the discretion of the hotel, and they do not benefit the hotel.Resort Fee Litigation Exposure Matrix(mandatory fee options and necessary disclosures) Policy on Fees What is disclosed and how Legal issue? No Fees Total Price (i.e. in this case, it is the room rate) No issue No Fees Charge only for services used (i.e. optional with guest usage) Total Price (i.e. in this case, it is the room rate)No disclosure on optional services required in online ads No issue Charge FeesTotal PriceTotal Price must be the first and most prominent price No issue Charge FeesList Fees separately breaking out Total Price to show room rate and Fees Total PriceTotal Price must be the first and most prominent priceAfter Total Price (or right next to it), disclose portion of cost that is mandatory fee No issue as long as Total Price is first and most prominent price Charge Fees Room rate is first price mentioned and Total Price and/or Fees are disclosed later or in smaller or less prominent font YESThis is drip pricing; the current hot issue with the FTC and 47 State Attorneys GeneralWe also expect this will likely trigger a new wave of class action claims Remember: Resort Fees are not illegal. This is all about disclosure.For the last two decades -- as long as this issue has been rankling consumers and government agencies -- no one has ever suggested that mandatory fees are illegal or improper! The only issue is about the disclosure that must be given on pricing.So even if a hotel decides to take the most conservative approach on disclosure, the hotel can still charge the Resort Fee and display this charge separately. The Uniform Standards of Accounting for the Lodging Industry, 11th edition, provides that these mandatory charges are not accounted for as rooms revenues (but rather as "Miscellaneous Income"). Therefore, the significant mandatory fees should still be exempt from various charges on "rooms revenues" such as transient occupancy taxes, franchise fees, frequent traveler program charges and the like. And hotels can still provide their guests with a big bundle of amenities and value at a discounted price.The biggest problem for a hotelier in moving to position advocated by the FTC and consumer groups is the competitive disadvantage when consumers compare pricing online. The first hotels listing Total Price as the first and most prominent price may lose business to those that list only room rate with mandatory fees in the fine print. But that is part of a different discussion for another day.For more information about Resort Fee issues, including the latest updates, go to www.HotelLawBlog.com, scroll down the right-hand side under LEARN MORE ABOUT and click on "Resort Fee Litigation" where you will find all the articles on the subject.
M3 - 12 October 2017
The M3 mobile app enables hoteliers to securely access their data like never before, viewing real-time, mission-critical information like:Key Performance Indexes: Occupancy and ADRRooms RentedTotal Room RevenueFood and Bar RevenueRooms Out of OrderRedemptionsGuaranteed No ShowsComplimentary Rooms"I'm always on the road, and this app has given me access to the information that I need to make great business decisions about the hotels my company owns and manages," explained M3 CEO and hotelier John McKibbon. "We've provided analytics tools to hoteliers for many years now, but having access to this information in the palm of my hand, wherever I'm at really brings the Operations Management platform data to a whole new level. My Regional Managers have embraced the mobile app and have already made it part of their daily routine."With the M3 app, busy hoteliers can quickly toggle between prior year or budget comparisons to view variances based on daily, month-to-date or year-to-date current year performance.Current M3 users can download the M3 app in the Apple Store or Google Play store and login with their credentials.To become a part of the M3 family and gain mobile access to your data, contact Kristy Ingram at 770-297-1925 x230 or email@example.com.
National Restaurant Association (NRA) - 12 October 2017
It was a sweet victory on Oct. 11, when the Cook County Board of Commissioners repealed the controversial beverage tax it passed last year. The tax, which took effect in August, was an attempt to close a budget shortfall. It placed a penny-an-ounce tariff on soda and sugary beverages. The board voted 15-2 to end the tax, which had angered both consumers and business owners.
Phocuswright - 11 October 2017
Countdown until $200 savings expires on October 20th. Register now to save!Here are 10 reasons you shouldn't attend The Phocuswright Conference.1. You have no reason to hear from - and meet - top travel executivesHate growing your professional network? Then this isn't the conference for you. And if you prefer to log thousands of miles in business travel visiting your top clients - instead of meeting them back-to-back in one convenient location - you should probably sit this one out. Nearly 2,000 decision makers and C-level executives representing dozens of countries come ready to do business.2. You don't see value in words of wisdom from founders and investors"What do founders know that I can't get from client feedback? I don't need investors telling me which segments and technologies they're betting on ..."Avoid mistakes and missed opportunities. Hear emerging leaders and investorsfrom Silicon Valley to London to China weigh in on the global state of startups, innovation and investment trends in travel.3. You don't need to discover new technologies and innovative ideasAI, machine learning, NLP, blockchain? Buzzwords. Your product and service are built with lasting power. No virtual reality this and chatbot that is going to disrupt you.No company is disruption-proof. Our demo lineup of the most innovative startups and established companies helps you keep tabs on what's next for the industry.4. You don't like beach weather and cool nights in the mid-70sYou love London in November. After all, near-freezing temperatures give you energy to close the next deal! Ah, sunny Florida. There's no better atmosphere to make new connections, foster old relationships and be among the travel industry's savviest leaders (all while taking advantage of the warm weather and newly renovated venue).5. You hate it when conferences make it easy to meet new partners and vendorsInspired by the chase, you'd rather wander a trade show hall in search of your next customer. A VERY short coffee break between conference segments adds a welcome challenge. No other conference provides access to such an elite and motivated group ofattendees - with ample time to discover new partners and opportunities. If you're ready to meet prospective clients, The Phocuswright Conference is the perfect place to prove your worth.6. You're not interested in fast-growing markets like China, India and MexicoWho needs emerging markets? Who needs over $350B dollars of market size and nearly 20% growth rates? Who needs to know about the world's top mobile booking market? We've got the leaders of some of travel's hottest global players. $160B in online travel market cap will be represented on Center Stage, featuring companies like Ctrip, MakeMyTrip, Expedia, The Priceline Group, TripAdvisor and more. And we've even assembled the Wall Street analysts who cover them.7. You don't want to hear from industry-agnostic UX expertsHey, you just updated your mobile app last year. Right? So you should be all set.Welcome to the new UI. Whatever we want, whatever we share, however we go ... every touchpoint is up in the air. From sharing to speaking to driving, the UI is upending, and the UX is everything. Don't miss a special session, The New UX, featuring executives from Fin, Snap Inc. and Waymo, three key voices determined to reimagine how we share, re-envision how we get around, and reinvent the standard for the digital assist.8. You don't like to speak out and ask Center Stage speakers the tough questionsPR spin is your favorite.We give you a direct line to the people leading travel's biggest and most successful companies. Raise your hand and inspire the debate at the travel industry event of the year.9. You don't care about how the digital travel industry affects your businessYou're tired of hearing digital this, digital that. You've got it covered.The Phocuswright Conference program consistently features a mix of promising innovative startups, companies at the forefront of technology development, Wall Street's leading travel analysts and high-profile travel brands. It's the perfect combination of what's new, what works and where we're all headed as an industry.10. You like hearing unlabeled sponsor messages intermingled with featured programmingIf you like getting blindsided by paid content, this isn't the event for you. We never let sponsors on Center Stage. Year after year, we assemble the largest gathering of travel executives and create a program driven by Phocuswright Research. This year, the biggest names in travel return to Center Stage to share their take on market dominance, growing already-behemoth brands and working with partners big and small to make their travel product better for every consumer.It all starts here.If you're ready to attend The Phocuswright Conference, register here.(Click here to view attendee feedback.)
hotelnewsnow.com Featured Articles - 11 October 2017
Owners and operators don’t always see eye to eye, but in today’s hotel industry, the two parties are more or less on the same page given the industry’s solid performance and the major hotel companies mostly being asset-free or asset-light, sources said. But friendly relations can change as quickly as one can say mergers and acquisitions.
CFO Magazine - 11 October 2017
The Northern California wildfires. Harvey. Irma. Maria. We shudder at the thought of the devastation these natural disasters have inflicted. And such high-cost disasters aren’t just happening in the United States. In Mexico, strong earthquakes have left hundreds of people dead. Across South Asia, more than 1,200 people were killed and millions more displaced in severe monsoons in August.
CFO Magazine - 11 October 2017
After pivoting from personal computers to data center hardware and software, Dell Technologies is now charting a course toward the next state of its evolution — providing “distributed” computing through the Internet of Things. The company said Tuesday it will invest $1 billion in new IoT products, research and partnerships over the next three years and named Ray O’Farrell, the chief technology officer of its Vmware subsidiary, to lead a new IoT Solutions Division that will combine internally developed technologies with products from its partner ecosystem and investments.
harvardbusiness.org - 11 October 2017
This fall, college seniors across the U.S. are making a choice that will shape the rest of their lives: which career to pursue after graduation. It’s a breathtakingly complex decision, involving trade-offs among prestige, job security, quality of work life, and compensation. Yet these career choices affect not only the students themselves but also the rest of society. Economic research increasingly indicates some professions have “spillovers,” meaning that the social value of an individual’s work can be much higher, or much lower, than that individual’s compensation. The job market does not account for all social value.
Business Travel News (BTN) - 11 October 2017
The Supreme Court has dropped a challenge to U.S. President Donald Trump's second travel ban, issued in March. The case originated in a Maryland federal district court and survived an appeal in the Fourth Circuit Court. The Supreme Court was scheduled to hear oral arguments on Oct. 10 but canceled those hearings on Sept. 25 when Trump issued a proclamation, his third version of a travel ban. Technically, the Supreme Court vacated the appeals court's decision and removed the case from the docket, calling it moot now that Trump has issued a third travel ban to replace the second.
Lucinda Hart, CAE, MBA, has over 22 years of association management and customer service experience in the areas of human resources, certification, membership, chapter relations, conferences/trade shows, nonprofit legal issues, and governance and administration. As HFTP Chief Operations Officer, Lucinda is responsible for the day-to-day operations of the association, managing 30 staff members, as well as representing HFTP at numerous industry global events. Lucinda received her Bachelor of Arts in Human Resource Management and her Master of Business Administration in Organizational Leadership and Management from Concordia University Texas. She is also a Certified Association Executive (CAE). Lucinda was awarded the Professional Excellence Award from the Texas Society of Association Executives (TSAE). She serves as a mentor for Leadership TSAE and Concordia University Texas.
Hotel Management - 10 October 2017
Lenders provide many options for financing in the hotel industry, but finding the right debt for an asset can sometimes be a daunting experience, especially if hoteliers aren’t aware of the alternatives. While traditional recourse loans are an option for financing, Mac Dobson, SVP of originations for Aries/Conlon Capital, said they aren’t without their limitations. For instance, the borrower must personally guarantee the loan, which means both personal wealth and the property are on the hook if there is a default. Then, if there is a foreclosure with a shortfall after the sale, the borrower is on the hook for that amount.
hotelnewsnow.com Featured Articles - 10 October 2017
Two massive hotel deals are in the works—AccorHotels’ proposed buy of Australia’s Mantra and Singapore-based real estate company* CDL’s full buy of Millennium & Copthorne. Both point to issues of distribution, scale and management experience and show a continuing interest in the sector’s business fundamentals. Two likely pieces of hotel industry business that have come to light on 9 October involving companies in the Asia/Pacific region underline the strong pace and desire for mergers and acquisitions, according to sources close to the bids but not able to speak on the record. AccorHotels is pursuing a non-binding takeover of Australian hotel company Mantra Group, according to a statement posted by Mantra to the Australia Stock Exchange and reported by Australian media. The Sydney Morning Herald reports AccorHotels made a $1.2-billion Australian dollar ($932.03 million) offer for Mantra.
Cycas Hospitality BV - 10 October 2017
Cycas Hospitality is the largest branded extended-stay hotels operator in the UK, with additional operations in Benelux and ambitious plans to roll out the concept across continental Europe. It is a 'white-label' operator that partners with institutional and private investors to maximise the full potential of their hotel assets. Its current clients include Starwood Capital, M&L Hospitality, and CLS Holdings plc; outside North America, it is the largest operator of Staybridge Suites and Residence Inn hotels.Hua Kee has acquired a one-third share in Cycas, and its investment provides the business not only with additional working capital but also a co-investment partner and potential for future deals.Cycas Hospitality's turnover under management is forecast to treble over the next two years from EUR38 million to over EUR100 million based purely on the business's existing, secured and signed pipeline of hotels. Cycas currently has 3,000 guest rooms either open and operating, or signed and in the pipeline; it intends to grow this to more than 10,000 in the next five years.Eduard Elias, Cycas Hospitality's co-founder, said: "Extended-stay accommodation, which includes serviced apartments and aparthotels, is a new and dynamic asset class in Europe and is evolving as a major subsector in the hotel industry as leisure and business travellers increasingly seek and value flexibility and independence. We are delighted to welcome Hua Kee as investors and partners. We have exciting plans; we are actively seeking additional hotels to operate across continental Europe; and Hua Kee's investment provides us with the capital we need to achieve this next phase in our strategic plans."Erik Jacobs on behalf of Hua Kee added:"Cycas Hospitality is known for its exceptional customer service. This passion for wowing its customers, its clear market-leading position in this exciting, evolving market, together with its ambitious plans in Europe, made it a highly attractive investment proposition. In comparison with the US, Europe is largely underdeveloped and undersupplied in the extended-stay sector and we are anticipating this sector to gain significantly more market share in the short, medium and long-term. We are delighted to be Cycas Hospitality's strategic partners and investors."
HVS - 10 October 2017
HVS is reminding owners and asset managers of hotels and casinos that have suffered insured losses of profits due to business interruption from the recent hurricanes that HVS has staff experienced in calculating, and supporting the claim for, business income losses. HVS will provide a calculation of the profit lost during the period that is covered under the business interruption period provided for in insurance policies.HVS has one of the largest data bases of information for Florida, Gulf Coast, Puerto Rico and other Caribbean markets in the consulting industry. The data includes market and financial data that can be used for benchmarking actual and projected results. When an entire hotel market experiences damages and closures due to events such as the recent hurricanes, the calculation of revenues lost for an individual hotel must be verified using models that are very similar to those used in the supply, demand and penetration forecasts HVS uses in its market studies and appraisals.With its in-house appraisal, design and affiliated architects HVS can assist in calculating the cost of physical storm damage repairs.HVS Asset Management's Newport, RI office will be leading the business interruption claim service effort. In its normal course of business, we analyze budgets, forecasts, rooms, meetings and catering booking pace, food and beverage, other revenue departments as well as labor and expense levels of all types of hotels and resorts in great detail. Our staff is experienced at reviewing hospitality insurance policies, with special emphasis on the business interruption coverage and requirements. Combining the analysis capabilities of our asset management team with our industry-leading hospitality intelligence and hotel and market revenue forecasting expertise, HVS is the most qualified firm to assist owners and asset managers and their law firms and insurance brokers when calculating the lost income and supporting the aggressive pursuit of business interruption claims. Our methodology will allow our clients to recover the lost profits that they deserve under their insurance coverages.For information contact either Jeff Crowley at +1 305-582-8928 or JCrowley@HVS.com or your regular HVS contact.
hotelmanagement.com.au - 10 October 2017
The accommodation industry is supporting calls for the South Australian Government to properly regulate sharing economy providers, including Airbnb. The Accommodation Association of Australia said that unless the SA Government moves to address this issue, the safety of domestic and international visitors is at risk. “In June last year following little or no consultation, the South Australian Government effectively gave the green light to sharing economy platforms to operate with the same level of regulation as residential properties,” said Accommodation Association of Australia Chief Operating Officer, Laura Younger.
hotelmanagement.com.au - 10 October 2017
The accommodation industry is supporting calls for the South Australian Government to properly regulate sharing economy providers, including Airbnb. The Accommodation Association of Australia said that unless the SA Government moves to address this issue, the safety of domestic and international visitors is at risk. “In June last year following little or no consultation, the South Australian Government effectively gave the green light to sharing economy platforms to operate with the same level of regulation as residential properties,” said the Association’s Chief Operating Officer, Laura Younger.
Hotel Law Blog | By Jim Butler - 9 October 2017
It is budget season again — that time when operators and owners sit down to agree on the financial blueprint for the next year. My partner Bob Braun has worked on many hundreds of hotel management agreements and issues arising under them. Today, he shares some insights about the how to maximize the budget opportunity for constructive dialog between owners and operators.
The Hotel Financial Coach - 9 October 2017
As the Regional Operations Analyst in the mid-90s in the West, my boss and I reviewed the financial performance of all of our hotels pretty much on a quarterly basis. The reviews consisted of a trip to the hotel, a tour of any capital projects, and a sit down with the core executive team to review the financials.We quickly developed a reputation for being somewhat thorough--always digging--and a little confrontational. One such review uncovered a little screw up that caused the GM a ton of embarrassment. It was one of those deals where the victim buried himself with his own BS. The zingers on this one continued for years and people still recall it some 20 years later.One of the hallmarks of our hotel company's brand at the time was the existence of the Pac-ManTM china. The china was used predominantly in banquets and room service. The china was nicknamed Pac-Man because it had little black symbols that resembled the figures in the Pac-Man video game. It was also completely indestructible and ugly as can be.Most hotels were in the process of replacing the ugly pac man china and the hotel we were visiting and doing our latest review on had just switched out the banquet china.Doing a P&L review with the boss is fun. At least fun for him and me. He asks the questions and the team answers. If he likes the answer, we move on. If he does not like the answer, we dig. When we dig, we often find the dirt.One thing that everyone knows in the hotel business is just how expensive china can be. Usually a hotel picks a pattern and it does not change for years. The hotel adds to the quantity annually to replace the breakage. As I mentioned earlier this hotel had just replaced the banquet china. In fact, we reviewed the selected pattern a few months earlier and the hotel was given the approval by the boss for replacement china. Which was a big deal--probably like $35K.The earlier review of the replacement china finished with a verbal approval by the boss, meaning send him the paperwork. He also issued a cautionary comment to the GM, "Make damn sure the dinner plates are the same size." To which the GM replied, "Of course, we know." It was almost to the point of the GM belittling his boss because of his mothering statement.The GM was a relatively young GM, this was only his second hotel. He had the reputation of being a "screamer and shouter" when things got tense with his team. He also had the reputation of being just a little arrogant.In our review, we were making the usual finds: slipping productivity here, a slightly higher cost of sales there, some question on expenses here, and then...BANG! We find it. F&B other expense: $40K for the month. This must be a mistake. How could anyone spend that much on miscellaneous? It is usually $1,000 or so because it contains chef's hats and wooden spoons costs.The boss asks, "So what's the story with this one?" Silence ensued. "I guess no one knows?"The boss glanced across the table at the controller, who looked sheepishly at the food and beverage manager, who in turn looked directly at the GM and said, "I wasn't here then." My boss looked at the GM and said, "Out with it, what's going on?"The GM cleared his throat and said, "It's the new plate covers." There is now a deafening silence and the air is quickly sucked from the room."New plate covers, why the hell would you need new plate covers?"The GM looked around the room for a friend, but there was no one. The GM then said," The new banquet dinner plates are the wrong size."The boss looked at him and smiled, "Why the hell would they be the wrong size? Send them back then."The GM grinned a silly smile and said, "Apparently we forgot to measure the sample and the spec we were sent was somehow wrong." Apparently and somehow are not words you want to use when you are running a hotel.The boss looked at him and said, "You must be kidding me, didn't you check the sample when it came back, to see if your plate covers fit?" Silence.Well, suffice to say the boss had a field day with the situation. As it turns out metal plate covers are more expensive than the new china. Like the carpenter says, measure twice and cut once.The P&L review is like an interview with a panel of inmates. Sooner or later the truth comes out. When it is the GM that is left holding the bag and he or she has not come clean before, it is very telling and damaging. Bravado has an extremely short shelf life and it will blow up in your face.Be the first to tell the bad news and the last one to tout your victories. Let someone else take the credit for those.I learned a lot about leadership from these meetings and a lot about our business.Watching the boss in action was better than two degrees from Cornell.---If you would like a copy of any of the following send me an email at firstname.lastname@example.orgHotel Financial Policy Manual - Inventory of "Sections"Hotel Financial Coach "Services Sheet"F&B Productivity SpreadsheetRooms Productivity SpreadsheetFinancial Leadership Recipe F TAR WFlow Thru Cheat SheetVisit my website today for a copy of my FREE guidebookThe Seven Secrets to Create a Financially Engaged Leadership Team in Your Hotelwww.hotelfinancialcoach.com
hotelnewsnow.com Featured Articles - 9 October 2017
Hoteliers have been anxiously awaiting a change to the U.S. tax code, hoping elected officials would keep their campaign promises to simplify the code, make it more business-friendly and provide breaks for the middle class to increase their disposable income. After months of talks, teases and failed attempts to repeal and replace the Affordable Care Act, President Donald Trump’s administration and members of Congress have proposed a plan they say will fix the country’s tax code. Hotel News Now reached out to hotel owners and managers to get their impressions on the proposal and what, ultimately, they hope comes from it.
CFO Magazine - 9 October 2017
The net stable funding ratio was supposed to make very large banks safer to deal with in the wake of the liquidity problems encountered during the financial crisis. The more stable a bank’s funding sources, presumably, the more resistant it might be to financial crash, making it a safer counterparty. But now, on the eve of the rule’s implementation date, global banking regulators are looking to make compliance with the net stable funding ratio (NSFR) a little easier.