Flash-sale distribution has been one of the most compelling travel trends in recent years, allowing brands and hoteliers to increase occupancy during lulls in demand. Yet recent closings and layoffs may show that niche flash-sale sites will play a much reduced role for hoteliers in the future.
New York Magazine reports on layoffs at Gilt Groupe, which runs luxury travel sales site Jetsetter. The company laid off between 80 and 90 workers, and may have included the head of Gilt City, which is closely tied to Jetsetter. This week, travel flash site Voyage Privé closed down in the U.S. as well.
Facebook, meanwhile, has achieved a unique value proposition in the deals space, according to Tnooz. "Facebook has made it clear that it will not be charging for the deal platform, which is a fundamental difference from social buying services," writes Tnooz. "Where services like Groupon and others are focused primarily on providing hugely discounted offers to deal seekers, the [Facebook] Deal platform allows businesses to tailor the deals to their audience, for example offering a free coffee, a discount, or a donation to a charity in exchange for checking into the location."
Facebook also acquired location-based social network Gowalla in 2011, giving its deals offering a local component unmatched by competitors. Hoteliers should pay attention to shifts in the marketplace in 2012 to better expose their product to a wide array of consumers.
It looks like London is getting one last big push in hotel openings before the Olympics kick off in July. The Guardian has a great list of upcoming properties worth keeping an eye on:
Belgraves, A Thompson Hotel, opened its doors in the city's Belgravia neighborhood today, according to Luxury Travel Advisor. A joint venture with The Harilela Group, the hotel is the first UK opening from Thompson Hotels. The property has 85 rooms and suites as well as some decidedly cool and funky dining and drinking options.
Just off Fleet Street, the 184-room Temple Court Hotel will open in Serjeants' Inn in the Inner Temple on March 1, the third London outpost of Edinburgh-based family-owned Apex Hotels.
The Bulgari Hotel will open in April on Knightsbridge courtesy of Italian architect Antonio Citterio, best known for his furniture and lamps. It will reportedly have solid silver chandeliers in the ballroom as well as a large spa, screening room, library, cigar shop and smart Italian restaurant and bar.
The city will get its first Norman Foster-designed hotel on June 4, when the 175-room Me by Meliá opens on the Strand. This redevelopment of what was once the Marconi House incorporates its 1904 facade in an otherwise contemporary building with a 11-story round tower-like atrium.
The South Place Hotel will open this summer near Liverpool Street, a seven-story 80-room new-build boutique with Conran interiors and the first venture into hotel-keeping by the D&D restaurant group, which owns the Blueprint Café, Kensington Place, Le Pont de La Tour, Quaglino's, Skylon and others.
Across town in South Kensington, the independent 110-room Ampersand Hotel, due to open just before the Olympics, echoes the 19th century both in its structure (it was built in 1888) and in its eccentric decor, which are reportedly inspired by the area's Victorian museums.
Z Hotels will open a second property on Lower Belgrave Street, near Victoria station, in spring. The rooms will be compact and short on frills, but contemporary, chic and, with rates from £85, very cheap for London.
And finally, Luxury Travel Advisor is reporting that The Leicester Square Odeon, one of London's most popular cinemas, will be reinvented as a hotel. Radission Edwardian has bought the movie house from Irish debt company National Asset Management Agency, for an undisclosed sum. No word yet on an opening date, but the property is expected to have 245 rooms, 33 apartments and five restaurants.
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Hotel Management's editors are looking for hotels to profile in the magazine's popular DoubleTake section on the last page of each issue. Do you own or operate a unique hotel property that presents operational challenges that are outside the norm? We'd love to hear your story!
Past DoubleTake sections have profiled hotels in former prisons and schoolhouses, hotels in treetops, hotels in a block of ice and even a hotel where guests sleep in original Pullman train cars.
Have you overcome some particularly challenging (and interesting!) obstacles in order to welcome guests to your hotel? Email associate editor Elliott Mest with your story.
As the global economy recovers in 2012, look for hotel transaction volume to increase. Reuters reports that U.S. hotel executives are confident that deal volume will increase in 2012, after six months of a relative lull following the U.S. government's debt negotiations last summer.
"People are expecting 2012 to be a pretty positive year, with solid performance by the industry in terms of the demand for hotel accommodations and the ability to get deals done," Arthur de Haast, chairman of Jones Lang LaSalle Hotels, told Reuters at the Americas Lodging Investment Summit last week.
The lending equation has shifted as well, with private equity replacing the REITs as a source of funding of acquisitions. "The mix of the investors probably will change," said Sri Sambamurthy, co-founder of real estate firm West Point Partners, to Reuters. Hotel owners can also expect a flood of foreign investors into the U.S. hotel world, as risk in Europe affects hotel investments abroad.
In terms of markets, India and Vietnam look to be strong locations for development. Bloomberg reports on the state of the hotel industry in India, which has undergone major growth as the country's middle-class has expanded.
“For the last nine years, inventory in India went from 67,000 rooms to 130,000 rooms," Raymond Bickson, CEO at Indian Hotels Company, told reporters in Hyderabad. "Overall, India is at between 65 percent and 70 percent occupancy. All of those new rooms have been absorbed by the market. Barring one or two locations like Pune, where maybe there is quite a bit of buildup, the market has totally absorbed those new rooms. We have now just hit 6 million inbound tourists, and the new number from the government for domestic travelers has now crossed 740 million last year. All of this together means that capacity is growing in the entire country. Inspite of new inventory, occupancy will still remain robust at between 65 percent to 70 percent. It is very sustainable for the next 10 years.”
A recent report from Savillis also shows that the Vietnamese hotel market is showing impressive strength despite a decrease in total product. VietnamNet writes that "Total supply in the hotel market has decreased by three percent in the fourth quarter of 2011 in comparison with the previous year (7150 rooms from 47 hotels). The report also said that the market has been performing better than the previous quarter. Especially, 3-star hotels had very high occupancy rate of 68 percent."
Southeast Asia is on the verge of introducing yet another gambling destination, which could very will push Las Vegas even farther down the ladder of world's gambling capitals.
Japanese arcade-game maker Universal Entertainment Corp. is working on acquiring a local partner to open a $2 billion gaming and entertainment complex in Manila, Philippines, slated to debut in 2014, according to ABS-CBN News.
The project will be home to shopping establishments as well as two luxury casino hotels with over 1,000 rooms, a budget hotel and more. It will attract investments of at least $5 billion over the next five years.
The Philippines is just the next link in a long chain of gaming destinations that have successfully surged throughout the region. In addition to Macau, the most famous gambling center in Asia with 33 casinos, raking in $23.5 billion in 2010, Singapore is on pace to generate more gaming revenue that Las Vegas, according to msnbc. "The final numbers for 2011 aren't quite in yet," Holly Wetzel, spokesperson for the American Gaming Association told msnbc. "But it is anticipated that this year Singapore could surpass Las Vegas as the world's second-largest gaming market." In 2010 Singapore brought in $5.1 billion, while Vegas brought in $5.8 billion in gaming revenues. It is anticipated that in 2011, Marina Bay Sands and Resorts World Sentosa could bring in $.6.4 billion, higher than Vegas' totals of $6.2 billion.
One of the potential reasons for Southeast Asia's gambling surge is its record-number of gamblers. China's sheer volume of millions and millions of gamblers alone has attributed to the rising growth of the gambling industry in this region. Las Vegas, while appealing to international tourists, is still a bit of a stretch for the majority of Asia travelers, who cannot afford the trip to the United States. These Southeast Asia establishments are within a much shorter, and affordable, distance. Big international gambling companies like Las Vegas Sands and Wynn have already turned to Southeast Asia in order to expand their empires, and it is only a matter of time before more follow suit to tap into this resource.
The largest hotel transaction of 2012 so far, LaSalle Hotel Properties acquired The Park Central Hotel in New York City for $396.2 million in a transaction funded by cash and the issuance of new operating shares. Hotel Management spoke with LaSalle to find out more about the deal and the company's acquisition strategy this year.
“The hotel is on 7th avenue between 55th and 56th streets, so we’ve got a fantastic address in one of the best cities in the country unencumbered by brand,” said Michael Barnello, president and CEO of LaSalle. “ New York has been a strong market historically and will continue to be a strong market for the foreseeable future.”
LaSalle will begin a renovation of the property in late 2012 and look for new partners to operate the hotel. They’re looking to put between $30 and $35 million into the renovation. “We’re going to renovate starting in Q4 2012 probably through the first quarter of 2013,” said Barnello. “We’ll do the guestrooms, bathrooms, corridors and lobby. The property was supposed to close earlier last year, and it takes a certain period of time to get the new design worked out.”
Highgate Holdings will operate the hotel through the renovation, although Highgate and LaSalle had no prior relationship before this acquisition. “Our perspective is that we’re going to keep those guys in and have a great relationship with them,” said Barnello.
Barnello also said LaSalle will continue to look for acquisition opportunities in the New York City area as opportunities arise in 2012. “We need a seller first,” said Barnello. “New York is a target market for us, so we will definitely look at everything available."
Now that the Arab Spring is officially a year old, the Middle East has learned to cope with new realities and new challenges. And the region's hotel business seems to be adjusting rather well: A report from STR Global published on ArabianBusiness.com stated that demand for hotel rooms in the Middle East grew by nine percent in 2011, the highest growth rate in the world, and that the region reported both occupancy and average room rate improvements for the full-year.
Abu Dhabi reported the largest growth in occupancy, increasing 9.9 percent to 64.8 percent, followed by Dubai with a seven percent increase to 75.4 percent, STR Global's data showed.
Cairo, Egypt, was understandably the worst occupancy performer in the Middle East and Africa region, falling 44.9 percent to 36.1 percent, followed by Beirut with a 12.9 percent decrease to 56.2 percent.
Jeddah and Riyadh were the top regional performers in 2011 for average daily rates. Jeddah's ADR rose by 6.9 percent last year to $203.51 while Riyadh rose 6.6 percent to $271.67.
Dubai topped the regional chart for the largest RevPAR increase last year, jumping 10.7 percent to $168.64, the STR Global statistics showed.
Cairo's RevPAR fell the most in 2011, by 49.2 percent to just $42.71.
Overall in 2011, the Middle East and Africa region reported a 6.8 percent decrease in occupancy to 57.1 percent, a 5.3 percent increase in ADR to $162.81 and a 1.8 percent decrease in RevPAR to $92.99.
Hotel brands are taking note and stepping up their development in the region, including Hilton, which The National is reporting expects its business to grow in the Middle East this year. (The company does not issue specific figures for its forecasts.) And Accor is predicting a strong year of expansion in the Middle East for 2012, according to Hotelier Middle East, which quotes the brand's Middle East managing director Christophe Landais. Landais told the paper that the company is aiming to open 10 new hotels with a total of 2,800 rooms in the UAE and in Saudi Arabia. The 10 hotels will be positioned across all markets, from economy to luxury, and include brands such as Ibis, Novotel and Sofitel. This will grow the brand's total regional network to 65 hotels.
Just as no one could have predicted that 2011 would change the Middle East and Arab world so drastically, it will be hard to predict what 2012 will bring to the region. The investment from these major brands, however, indicate a strong sense of confidence in the market, and it seems safe to say that this year will see substantial economic growth and development throughout the area.
For individual hotels that are considering an energy management upgrade, there are several different solutions that can increase guest satisfaction and reduce wasteful spending on electricity. Brands are beginning to take a more comprehensive approach to partnering with owners and operators during a renovation. When the Palace Station Hotel in Las Vegas was looking to upgrade its room EMS, the property chose to select a solution that combined sensors with central automation.
"Onity came in with a system that would work in conjunction with our existing unit and supplied a remote thermostat unit and wireless door switch for the guestroom door," said Paul Connelly, engineering supervisor at the Palace Station Hotel. "We were able to modernize that particular style of room to where people can now use a thermostat that looks like one you would have in your house.”
The property was able to keep rooms available for booking by closing only a portion of its inventory at a time for upgrades. Engineers and operators are more focused than ever on controlling costs during periods of peak energy demand. "We have 500 rooms and realized a huge savings,” said Connelly. “It also cuts down on our service call-in for engineering staff because the data is all sequenced into program called Control Green that engineers can look at remotely."
Regardless of a cutting-edge installation, active management remains key to reducing wasteful spending. "You can put a brand-new automation system into a building but if you don’t follow up on it and have right staff in place, adjustment by adjustment you’ve lost the fine-tuned edge of the system," said Doug Rath, energy director of the Americas for Marriott International. "A system is assumed to start out well-designed and efficient so it's delivering on ROI. However, there's a huge relationship between whoever is overseeing the system on a daily basis and the persistence of the commissioning of the system; a direct relationship between owner/operator and efficiency."
Some properties will stage an energy remodel and room refurbishment at different times, due to the long-lasting nature of modern energy management upgrades. "I would think hoteliers will go through an energy remodel on a different cycle than a normal room refurbishment," said Karl Williams, VP of energy solutions for Rexell. "Essentially the lighting and some of the management of the load should be on more of a cycled type of change out because all the technology now is moving to such long-life technology that when you install an LED or CFL bulb you don’t need to change it for a long time."
And for properties that have been properly wired and upgraded, leveraging connectivity is a constant effort instead of a one-time adjustment.
"If you’ve got your building wired up, the technology is available today where you can deal with the property manager literally program a panel to control all the lighting," said Williams. "If you've got a peak demand issue, that change is going to be unnoticed but you can save your property some significant money."
Bangkok is, indeed, open for business in 2012. It was tough times for Thailand last year, when the country suffered severe flooding during the second half of the year. But with Marriott International Inc. inking the agreement to open an Edition hotel in Bangkok, the proof is in the pudding that the city is back in action.
According to the Wall Street Journal, the Edition brand will open five new properties by 2015, one of which will be in Bangkok. "The deals come as Marriott is investing as much as $800 million of its own money to develop three additional Edition hotels - in New York, London and Miami Beach - in a break with its typical practice of managing properties for third-party owners," the article reports.
The Bangkok Edition will be part of a mixed-use skyscraper, with both residential and retail space. According to WSJ, the plans for the property were previously in motion but had a stop put on them due to Thailand's financial and political situation. It is full steam ahead again, the article reports.
Anantara Hotels, Resorts & Spas is also pumping out good news from Bangkok. Late last year the company took over the Marriott Bangkok, reopening it as the Anantara Bangkok Riverside Resort & Spa.
Starwood also debuted its first Aloft property in Thailand, the Aloft Bangkok-Sukhumvit 11.
The San Francisco Chronicle is reporting that Sofitel So Bangkok is set to debut on February 28, as well.
As far as tourism goes, the center of the city, where the luxury hotels and shopping sit, received bad word of mouth. Media coverage skewed the external perception of the city, which has greatly impacted tourism numbers in a negative way. The high season was absolutely compromised. While areas outside of Bangkok are still drying, the city itself has returned to normal, and with the introduction of these well-known brands, the public is sure to follow.
The spotlight is on Indonesia recently, as many hotels are undergoing rebranding, renovations or scheduled openings. Indonesia, while always a popular tourist destination for the Eastern hemisphere, has been less traditional for U.S. travelers because of its distant location. However, with the expansion of airline routes and the introduction of spacious airbuses like the A380s, it is only a matter of time before the 17,000-island archipelago rises to become one of America's favorite travel destinations.
Travel Daily News is reporting that the Jumeirah Group, the Dubai-based luxury hotel company and a member of Dubai Holding, has signed a management agreement with PT Asia Pasific Properti to operate a new luxury resort on the island of Bali. The resort will be known as Jumeirah Bali, and is slated to debut in 2015. "Jumeirah currently has one hotel open in the Asia region - Jumeirah Himalayas Hotel, Shanghai. A further five luxury hotels are under development in China, in addition to a hotel in Thailand," the article reports.
eTravel Blackboard is reporting that Accor will officially take over Hotel Nikko Jakarta, with the hotel sporting the Pullman name. Pullman is Accor's upscale hotel brand designed with the requirements of the modern business traveler. At the moment, the hotel is undergoing major refurbishment to the guest rooms, lobby, restaurants and more. It will be completed in 2013. Pullman says it as commitments for a further 34 Pullman hotels in the Asia Pacific region. City-of-hotels.com writes that the company has plans to open 12 five-star Pullman hotels over the next five years in Indonesia's largest cities.
Finally the Pan Pacific Nirwana Bali has revealed the results of its recent hotel refurbishment, according to Hotel Management Asia. The refurbishment also marks the launch of Pan Pacific's signature Pacific Club. The resort now features eight dining concepts and an enhanced Nirwana Spa, with 20 specialty treatment rooms.
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