Latest news: Kimpton adds Italy; Minor, Funyard deal; Mideast pipeline update

Kimpton to Italy. IHG Hotels & Resorts signed its first Kimpton Hotels & Restaurant property in Italy with a property in Sicily scheduled to open in the second half of 2025 with partner Società Turistica Alberghiera Taorminese. The 59-boutique bedroom hotel is expected to feature destination dining. It will IHG’s 30th hotel in Italy and joins a portfolio of eight Kimpton hotels across the UK and continental Europe. IHG said in the coming years, 54 more hotels will join the Kimpton brand, which would surpass the 100 hotels milestone and reach 20 countries by 2025.

Avani grows in China. Minor Hotels and its joint venture partner in China, Funyard Minor JV Co., will debut Avani Hotels & Resorts in China in the protected national forest area of Guangdong Province. The 86-room Avani Huajian Xinyi Guangdong Resort and the 96-room Avani+ Xinyi Guangdong Resort will open in the first half of the year. Avani Hotels & Resorts’ expansion into new destinations continues in 2024 with further openings in Asia, Europe and the Seychelles, as well as South and Central America.

Mixed performance in US. U.S. hotel performance from February 11-17 increased from the previous week, while year-over-year comparisons remained mixed, according to CoStar data. Occupancy was 59.2% (-2.5% YOY); ADR was $162.24 (+4.2% YOY); and RevPAR hit $96.10 (+1.6% YOY). Among the Top 25 Markets, Boston (+14.6% to 64.7%) and New Orleans (+14.6% to 75.7%) matched for the largest increase in occupancy. Mardi Gras drove New Orleans’ occupancy increase. Thanks to Super Bowl LVIII, Las Vegas reported the highest jumps in ADR (+76.7% to US$318.88) and RevPAR (+81.4% to US$257.72). Weekly occupancy grew 2.7% to 80.8%. On Sunday night, Las Vegas’ occupancy topped 80%, and ADR reached higher than US$800. Phoenix reported the steepest RevPAR decline (-21.6% to US$173.63) because of comparison to its Super Bowl host period last year.

Covivio takes control of brand. Paris-based real estate developer Covivio has signed an agreement to acquire the 8.3% stake in Covivio Hotels held by investor Generali in exchange for new Covivio shares. This transaction represents the equivalent of the acquisition of €500 million of assets and a capital increase of nearly €300 million. Following this contribution transaction, which is expected to be completed by the end of April, Covivio will hold 52.2% of the share capital of its subsidiary Covivio Hotels and will launch a mandatory public exchange offer for the remaining share of the capital. A limited partnership listed on Euronext Paris, Covivio Hotels is owned by Covivio and by long-term institutional investors: Crédit Agricole Assurances, BNP Paribas Cardif, Generali, Assurances du Crédit Mutuel, Sogecap and CDC. Covivo Hotels portfolio includes 313 hotels, 89% of which are located in the main European tourist cities such as Paris, Berlin, Rome, London, Barcelona and Madrid.

Standard growing in Europe. Standard International is adding three properties in Europe. The 200-key Standard in Brussels will open in the first half of 2025 within the transformed World Trade Center as part of the ZIN multipurpose redevelopment project in the Northern Quarter. It will include 20 extended-stay keys. In late 2025, the 172-room Standard Lisbon will transform a former naval hospital into a mixed-use property with branded residences in the historic town of Alfama, Lisbon. Looking ahead to 2027, The Standard, Dublin will debut as a 200-room property in the Dublin Arch (formerly Connelly Corner) development.

Mixed January in Canada. Canada’s hotel industry in January showed lower occupancy but continued growth in ADR, according to CoStar data. Occupancy was 49.6% (-1.7% YOY); ADR was C$175.38 (+4.3% YOY); and RevPAR was C$87.00 (+2.6% YOY). “Transient occupancy fell 3.7% year over year, with most of the decline taking place on the weekends, suggesting that individuals are pulling back on discretionary spending,” said CoStar’s Laura Baxter. “Warm weather and a lack of snow in popular ski areas contributed to the shortfalls as well, with particularly steep occupancy declines in resorts across Western Canada. Whistler and Banff hotels, for example, recorded occupancy declines of 9% and 12%, respectively. On the positive side of the spectrum, the overall hotel sector is outperforming metrics in the wider economy, with the room rate growth outpacing the 2.9% inflation reading.”

Residence Inn planned for San Antonio. Austin, Texas, developer Merritt Development Group has submitted plans for a 10-story, 171-room Residence Inn by Marriott in San Antonio, Texas, near the San Fernando Cathedral and next to the existing AC by Marriott hotel. If approved, the hotel is set to begin construction later this year with an anticipated opening by 2026.

Middle East pipeline update. The Middle East’s total pipeline stood at 607 projects/145,984 rooms at the end of 4Q23, according to Lodging Econometric. The region boasts an 11% year-over-year (YOY) increase in projects and a 2% YOY rise in rooms, marking the most substantial growth by projects since Q1 2018. At Q4, there are 309 projects/83,308 rooms under construction, up 2% YOY by projects. Luxury project counts reached an all-time high with 154 projects and 30,421 rooms. Upper upscale projects in the Middle East also reached the highest project and room counts ever recorded by LE, accounting for 25% of the projects in the region’s total pipeline, and closed Q4 with 160 projects/41,662 rooms. Hotel renovations and brand conversions in the Middle East have grown 46% YOY by projects, when compared to Q4 2022 totals, reaching a new record of 54 projects/11,484 rooms at the Q4 2023 close. Conversion projects grew substantially YOY in the fourth quarter, with a record 43 projects/8,790 rooms. Countries with the most projects in the construction pipeline are Saudi Arabia, with an all-time high of 300 projects with 72,761 rooms, and the United Arab Emirates (UAE), with 103 projects/27,152 rooms.

Sonder layoffs. Short-term accommodation provider Sonder Holdings is laying off about 106 corporate employees, about 17% of its corporate workforce. The company said it expects the layoffs to be “substantially complete” by the end of the first quarter and “lead to approximately $11 million in annualized cost savings.” The move comes nearly a year after Sonder laid off 100 employees, or 14% of its  corporate workforce. The company also laid off employees in 2022 as part of a restructuring designed to increase cash flow. Last fall, Sonder said it was revising its pricing strategy, eschewing using advance discounts to boost occupancy and instead focusing on maximizing revenue.