Latest HITs: Accor projections; Selina infusion; Peachtree sale

Accor plans aggressive growth. During a Capital Markets Day this week, Accor stated it plans to open more than 1,200 hotels in the next five years, projecting it would return to its pre-pandemic level of net unit growth of between 3% and 5% between now and 2027. In its luxury and lifestyle segments via Ennismore, Accor said it plans to add 110 hotels (30,000 rooms) during the next few years. Leadership said Accor has an EBITDA target for 2023 of between €920 and €960 million, an average annual EBITDA growth rate for 2023-2027 of between 9% and 12%, and a return to shareholders of around €3 billion. Accor now anticipates 2023 RevPAR growth of 15% to 20% compared with 2022 and has unveiled an EBITDA target of between €920 million and €960 million based on the business prospects for the current year.

Arora ties up with Accor again. Further to the acquisition in December 2021 of the U.K.’s Luton Hoo Hotel, Golf & Spa by owner-operator Arora Group, a deal has been made to redevelop the country house hotel with Accor’s Fairmont Hotels & Resorts brand. The property, dating back to 1601 and spanning 1,100 acres on the border of Hertfordshire and Bedfordshire, will first undergo a multi-million-pound redevelopment over the next few years.

Selina’s cash infusion. Selina Hospitality, New York City, has secured agreements for a strategic investment of up to $50 million led by an affiliate of Global University Systems (GUS), a global higher education platform. This multiple-tranche funding is part of the company’s plan to strengthen its balance sheet as it tries to achieve profitability and cash flow positive operations. As part of its investment, GUS will receive warrants to acquire additional shares in Selina at a premium to the current trading price and have the ability to appoint two directors to the board. During 2Q23, Selina released more than 350 full-time employees at the unit and corporate levels to realize $5.8 million in saving and incur a one-time restructuring cost of approximately $1 million. In 1Q23, Selina total revenue of $54.2 million marked an increase of $13 million, or 31.6% compared to first quarter 2022, driven primarily by an increase in bedspaces from newly opened locations, higher occupancy rates, and higher total revenue per bedspace. Selina did not open any properties during 1Q23, ending the period with 118 properties and 29,600 open bedspaces vs 103 properties and 24,159 open bedspaces at March 31, 2022. Selina has begun the selective exit of leases of underperforming locations to achieve long-term financial sustainability. It has closed properties in Mexico, the U.S., Greece, Austria and Costa Rica.

Extended-stay performance. The performance of extended-stay hotels in May was similar to April with the economy segment reporting a decline in RevPAR, upscale extended-stay hotels achieving the strongest gain in RevPAR and all extended-stay segments achieving better results than corresponding classes of the overall hotel industry, according to The Highland Group. The 1.5% net increase in extended-stay room supply in May is consistent with the average over the last 12 months. Economy and mid-price segments posted their strongest monthly gains in supply in 17 and 19 months respectively. Total extended-stay revenue growth in May was the second lowest monthly increase in more than two years. However, it was greater than the 4.5% gain STR reported for all hotels over the same period. Mid-price was the only extended-stay hotel segment posting an increase in demand. Extended-stay occupancy was 12.7 percentage points above the overall hotel industry in May 2023. May was the ninth successive month in which the upscale segment reported the strongest monthly gain in extended-stay ADR and the 19th consecutive month that total extended-stay ADR was higher than its nominal value in 2019. The growth in ADR in May, which beat the 3.9% gain STR reported for the overall hotel industry, was in line with rates of increase last reported from mid-2012 through the same period in 2014.

Refi in Kansas City. Chartwell Hospitality and Soundview Real Estate Partners have refinanced the dual-branded Residence Inn & Courtyard Kansas City Downtown Convention Center with 261 total keys in Kansas City, Missouri. RobertDouglas secured roughly $36 million of fixed-rate debt from a balance sheet lender. The loan carries a three-year term with open pre-payment after an initial 12-month lockout.

Peachtree sells in Georgia. The 138-guestroom Hampton Inn & Suites Jekyll Island in Georgia has been sold by the Peachtree Group to a Southeast-based owner/operator of upscale beach-oriented hotels. HREC Investment Advisors exclusively represented the seller.

Financing for Phoenix property. Dallas-based Hall Structured Finance has provided a $19.1 million bridge loan for the recently constructed, 127-room Residence Inn by Marriott Phoenix Mesa East. The hotel owner is Tucson, Arizona-based Khangura Development.

Choice-Radisson milestones. Since its August 2022 acquisition of Radisson Americas’ portfolio, Choice Hotels reports it drove a turnaround of results with expected revenue contribution and cost savings in 2023 and 2024 significantly ahead of original expectations. It also said it has enabled status matching and point transfers between Radisson Rewards Americas and Choice Privileges; leveraged nearly 100 new corporate customers to drive group bookings; opened seven Radisson Americas branded properties; awarded contracts for eight additional Radisson Americas branded hotels; renewed contracts or signed relicensing agreements with 27 Radisson Americas branded hotels; unveiled plans for a Country Inn & Suites guestroom refresh at its convention; provided Radisson Americas franchisees access to Choice University. Choice added that full integration is expected by the end of the year, including making Radisson Americas properties bookable on ChoiceHotels.com and connected to the ChoiceEDGE central reservations system; fully integrating the Radisson Rewards Americas loyalty program with the Choice Privileges program; and migrating eligible Radisson Americas hotels to the choiceADVANTAGE property management system and the ChoiceMAX mobile-friendly, cloud-based revenue management system.

Sonder grows in Florida. Sonder Holdings is launching four new properties across Florida. This will bring the company’s footprint in the state to 930 live units across hotel, resort and multi-unit serviced apartment properties. Upcoming openings include the 180-key The Deco resort hotel spread across four art deco buildings in Miami’s South Beach. These three properties were existing hotels that were integrated into Sonder’s portfolio. Also joining Sonder’s Florida portfolio is Colonnade, an office conversion into 95 serviced apartment units on Brickell Avenue in Miami’s financial district. It is expected to open in 2024. Sonder has already opened two new properties in Florida this year: the 76-key Found Miami Beach hotel and the 149-key Cirrus located near the Walt Disney World Resort and parks in Kissimmee, just south of Orlando. Sonder operates in 40-plus markets across 10 countries, and has approximately 18,200 live and contracted units as of 1Q23.

HE adds in Indianapolis. Hotel Equities, Atlanta, has been tapped to manage two Indianapolis hotels, the Fairfield Inn & Suites Indianapolis Airport and the Residence Inn Indianapolis Airport owned by JJI Hospitality. Hotel Equities now operates 14 hotels in the state of Indiana and has 12 airport hotels in its portfolio across the U.S. and Canada.

CoralTree growth. The new 375-room hotel at the United States Air Force Academy in Colorado Springs, Colorado, has been named Hotel Polaris by its owners, Provident Resources Group. The property will be managed by Colorado-based CoralTree Hospitality and is expected to open in late 2024. The 57-acre mixed use development includes the new USAFA Visitor Center, as well as commercial retail and office space.

Crescent adds in Canada. Crescent Hotels & Resorts has added the Ivey Spencer Leadership Centre in London, Ontario, Canada, and the Ivey Donald K. Johnson Centre in Toronto, Ontario, Canada, to its Latitudes: Lifestyles by Crescent portfolio. Ivey Spencer includes 125 hotel rooms and features 25,000 square feet of event space. The Ivey Donald K. Johnson Centre features 7,500 square feet of meeting and event space, including two amphitheater classrooms, two large meeting rooms, and 12 boardrooms.