Latest news: Former Trump in DC struggles; Playa reports strong demand; Club Med updates pipeline

Former Trump in DC defaults. Miami-based investor CGI Merchant Group has reportedly defaulted on a $285 million loan on the 263-room Waldorf Astoria in Washington, D.C., formerly the Trump International Hotel. At the same time, CGI is reportedly recapitalizing the property to reduce leverage with $75 million from investors led by Mavik Capital Management. The Trump Organization closed on the deal to sell the lease to the historic Old Post Office building, the crown jewel of its hotel operation, for $375 million in April 2022.

Related planning NYC luxury hotel. Related Companies is reportedly going to build a multi-billion-dollar tower at 625 Madison Avenue in New York City that will include a luxury hotel, condominiums and retail. Previous site owner, SL Green, sold the current building to Related in December for $632.5 million.

Playa earnings. Strong 4Q23 demand and subsequent ability to lift ADR lifted Playa Hotels & Resorts’ earnings with Adjusted EBITDA up 2.9% versus 2022. Chairman and CEO Bruce Wardinski said December occupancy in the Yucatán and Jamaica exceeded the December 2018 and 2019 average. “The Yucatán segment led the way on occupancy in the fourth quarter and was able to expand margins by approximately 100 basis points year-over-year on a currency neutral basis despite ongoing inflationary pressure and normalizing ADR growth,” he said. “Our legacy Dominican Republic resorts continue to be the preeminent leaders in the market, delivering double digit underlying owned resort EBITDA growth, adjusted for hurricane-related impacts on the financials, in the fourth quarter.” Wardinski added that 2024 pricing remains steady, driven by the strength in MICE groups. For FY 2024, Playa is anticipating Adjusted EBITDA to be $250-275 million with continued growth in ADR and occupancy year-over-year. However, he also warned of ongoing headwinds from foreign exchange rates as well as higher construction disruption related to our renovation work it began in 2023. “With our net leverage at a modest 3x and our expectation of continuing to generate a meaningful amount of free cash flow in 2024, we remain committed to returning cash to shareholders via share repurchases while pursuing growth opportunities within our footprint,” he said.

Club Med update. All-inclusive operator Club Med said in London this week that it plans to open nine new resorts, refurbish 10 others and reopen two more. The announcement by the brand, run by Chinese conglomerate Fosun International, follows the opening in December 2023 of the Kiroro Grand resort, Japan, and a new Exclusive Collection Space in La Rosière, France. The two resorts set to reopen are Vittel Ermitage, in July, followed by Serre Chevalier, in December, both in France. The new openings are Forlong, China, in December, followed by two in 2025 – Borneo, with an Exclusive Collection Space, and Gramado, Brazil. Four other new resorts due to open will also have an Exclusive Collection Space but no date has been set for their launch: Ouidah, Benin; San Sicario, Italy; Tinley Manor, South Africa; and Essaoura, Morocco. A further two resorts are also planned – North Sulawesi, Indonesia, and Musandam, Oman – but not date has been set for the openings. The news also comes after the brand’s first one-day pop-up High Street agency in London on February 20.