As recently as last year, threats of a fiscal cliff in the United States, economic and political instability in Europe and the Middle East, and slow growth in key Asian economies threatened performance across the globe. Yet signs of renewed vigor emerged. Now, as the world recovers from the global recession, more hoteliers are getting off the sidelines and back into the game.
Investments are pacing confidence in the economy’s recovery, helped by an improving job market, rise in new projects and renewed interest in renovations.
Hotel performance data also look strong, further suggesting a recovery. Commenting about Marriott International’s earnings for the third quarter, Arne Sorenson, the company's president and CEO, said worldwide revenue per available room was up nearly 5 percent year over year and occupancy rates in North America reached nearly 75 percent worldwide. In Asia, Marriott expects to open, on average, one hotel every eight days through 2016.
Starwood Hotels & Resorts Worldwide reported solid third-quarter financial results, with RevPAR growing 4.7 percent globally and 6.9 percent in North America at its company-operated hotels. Frits van Paasschen, Starwood CEO, said he remains “bullish on the long-term trends of rising wealth and increasing demand for travel in fast-growing economies, even in the face of slower growth in China, unrest in the Middle East and economic challenges in Latin America.”
Wyndham Worldwide also had a very good third quarter, reporting companywide revenue up 13 percent, net income up 15 percent and earnings per share up 25 percent from the prior year. Wyndham Hotel Group was a standout with revenue up 19 percent, thanks in part to a gain in domestic RevPAR of 5.2 percent. “Overall, we have great momentum across the company,” said Stephen Holmes, Wyndham Worldwide chairman and CEO.
Analysts expect an increase in tourism across the globe in 2014, thanks to the renewed efforts of destination marketing organizations, technology and an increase in travel among the emerging middle class of developing economies. As globalization has become the standard, it is more critical than ever to know the changing transactional, developmental and operational landscape, for success and maximizing value.