Managing Hotels Through High Inflation: a Game of Maximizing Revenues and Controlling Costs, Hears HVS Seminar
HVS | September 22, 2022
22 September 2022, London: The biggest challenges affecting hotels through this period of high inflation relate to the cost of labour, rising energy prices, coping with supply chain issues, the cost of debt and uncertainty that makes budgeting for the year ahead almost impossible. Discussing these issues at a seminar in London last week ‘Managing and financing hotels through ultra-high inflation’, organised by HVS, Bird & Bird, EP in Hospitality and AlixPartners, an impressive line-up of experts discussed the current challenges facing UK and European hotel revenues, costs and profitability, as well as the impact on M&A activ...
Sonnenblick-Eichner Company Arranges $82.425 Million of First Mortgage Financing for the Ocean Key Resort & Spa Key West, FL
Sonnenblick-Eichner Company | September 14, 2022
Beverly Hills, CA (September 14, 2022) -- Sonnenblick-Eichner Company, on behalf of Noble House Hotels & Resorts, has arranged $82.425 million of fixed rate first mortgage financing for the Ocean Key Resort & Spa in Key West, FL. Ocean Key Resort and Spa is a 100-room, full-service, waterfront resort recently honored by Forbes as the Best Luxury Resort in Key West. Proceeds from the five-year, non-recourse loan priced in the low 5% range, will be used to pay off and defease the existing loan and fund a $10.5 million renovation of the property. The life insurance company loan is interest-only for the entire term. Amenities a...
Hotel Budget Guide for 2022: Everything You Need to Know
September 12, 2022
By Josiah Mackenzie With David Lund I used to think of the budgeting process as a necessary evil, but speaking with David Lund, who has 30+ years of operational and financial leadership experience working with companies such as Hilton, Best Western, and Fairmont Hotels and Resorts, changed my view on this. In his view, hotel budgeting is a way to engage your teams, align on goals, and deliver financial results. The hospitality industry has experienced unprecedented volatility over the past few years, which may make creating a budget for 2023 seem intimidating. But as Lund advises, “the only thing we know about a budget is that it...
HVS Monday Musings: Income Capitalization Approach – The Gold Standard for Valuing Hotels
Anand Rai | August 29, 2022
By Anand Rai According to a recent GlobalData report, 573 deals (including mergers & acquisitions, private equity, and venture financing) were announced in the global travel and tourism (T&T) industry in the first half of 2022, reflecting a 3.1% increase over the same period last year. However, before these deals are concluded, the asset needs to be valued. So, how do we determine a hotel's market value and what exactly is valued under the category of hotels? The main valuation techniques are briefly covered in this article. The hotel’s market value takes into account the value of all of its different components, including th...
Hospitality Financial Leadership: What Hotel Brands Don’t Know – The Secret to Creating Great Financial Expertise
David Lund | August 15, 2022
By David Lund What brands don’t know is, they can create great financial bench strength in their hotels and their owners will pay 100% of the cost. Brands also don’t know that they can create this bench strength with resources that are readily available. Lastly, brands don’t know that their non-financial managers are literally dying to get these financial skills and abilities now and they want to apply them. Brands need to evolve. Brands need to stand still long enough to realize they sell one thing to owners, expertise in running and managing hotels. Brands sell expertise for all aspects of running and managing a hotel. Not just ...
Smart Benchmarking Starts With the Right Compset
Eula Skiles | August 15, 2022
By Eula Skiles Setting up a right profitability management approach starts with understanding your market and benchmarking against the right hotels. It’s also a way to attract the right guests. One of the best ways to do that is identifying the hotels that are most like your own vis-à-vis key count, F&B services and outlets, conference space and other offered amenities. In the hospitality industry, choosing a compset if the first step toward a winning market-share formula. For a consumer, one of the biggest costs of travel is booking a hotel room. The pricing trends of hotel rooms stem from a complex business strategy. In order t...
Hyatt Reports Second Quarter 2022 Results
Hyatt Hotels Corporation | August 11, 2022
Total Fee Revenue More than Doubles from Last Year; Reaches Record Level System-wide RevPAR, Excluding Greater China, Above 2019 CHICAGO (August 11, 2022) - Hyatt Hotels Corporation ("Hyatt" or the "Company") (NYSE: H) today reported second quarter 2022 financial results. Net income attributable to Hyatt was $206 million, or $1.85 per diluted share, in the second quarter of 2022, compared to a net loss attributable to Hyatt of $9 million, or $0.08 per diluted share, in the second quarter of 2021. Adjusted net income attributable to Hyatt was $51 million, or $0.46 per diluted share, in the second quarter of 2022, compared to Adjusted net l...
IHG Releases Half Year 2022 Results
IHG | August 9, 2022
REPORTABLE SEGMENTS1: Reported Underlying1 2022 2021 % change2 % change Revenue1 $840m $565m +49% +53% Revenue from fee business1 $664m $505m +31% +33% Operating profit1 $377m $188m +101% +91% Fee margin1 55.9% 44.1% +11.8%pts Adjusted EPS1 121.7¢ 40.4¢ +201% GROUP RESULTS: Total revenue $1,794m $1,179m +52% Operating profit $361m $138m +162% Basic EPS 117.4¢ 26.2¢ +348% Interim dividend per share 43.9¢ - ¢ NM Net debt1 $1,718m $2,458m (30)% KEY METRICS: $11.7bn total gross r...
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