Quotes of the Week: Noble Investment, Peninsula Hotels, Minor Hotels

QUOTE OF THE WEEK
“The real issue is that what the brands do with all the capex that’s really required. After the GFC (global financial crisis), capex spending dropped 40% because people needed to pay the lender. Everybody used every bit of FF&E reserve and liquidity to do that – and it took five years for capex spending to return, and that was at 0% interest rates. Today, post-COVID, that number in terms of capex spending dropped 80% – double what it did during the GFC. So, how long does it take to come back now? Not only do you have some PPP loans that need to be repaid, you have 75% loans that don’t size to anything more than maybe 50% to 55%. You have meaningful capex and nothing has been spent. So, those third-party operators will have a real challenge because hotels will start going into red zone status. There’s just a lot of pressure. – Mit Shah, Noble Investment Group  Read story

“We have a lot of territory to cover now in Europe, which may be we didn’t do in the past. Paris was alone for almost 10 years. So, I’m delighted we now have three hotels in Europe [Paris, London, Istanbul] because that gives us the critical mass to start penetrating a market like Germany, Spain or [others]. And that’s what we’re doing now. – Peter Borer, Hongkong and Shanghai Hotels  Read story

“We believe that standardization in any market, like the budget airline market, for example, exists because it delivers unbeatable value. We believe it’s the same for hotel rooms. Some people don’t care what view they have outside their window. They just want a clean bed. It smells nice and is consistent — they know where the light switches are. No matter where they go, the light switches will be exactly where they are… Even for a business traveler, we think it will be very attractive for them to feel like they’re coming home to the same room no matter where they are.” – Hannah Yulo-Luccini, Hotel101  Read story

“Even during COVID, we never stopped expanding… Our growth plan will continue, and we feel like there’s a lot more potential and a lot more places to go into Europe.” – Dillip Rajakarier, Minor Hotels  Read story

“New York City has recovered remarkably well after the pandemic, and demand from leisure, corporate transient and group customers is healthy. ADR growth in the city has also been strong, which gives investors conviction to invest.” – Jan Freitag, CoStar  Read story

“Your representatives have told owners and prospects that completion of the acquisition is a ‘100% certainty,’ in an apparent attempt to discourage them from doing business with Wyndham. While our best-in-class management team has been working actively to mitigate this threat, this risk would only grow worse in the event of a signed transaction with a possible two-year timeline.” – Stephen Holmes, Wyndham Hotels & Resorts  Read story

ICYMI
So far, Lifestyle Hospitality Capital Group (LHC) has done a single medium-sized deal. It agreed to buy Dublin-based Dean Hotels for around $400 million. Its ambition, however, is to create a company with assets in Ireland, the U.K., Continental Europe, and the United States. It could quite quickly become a billion-dollar enterprise.  Read story