From the desks of the Hotel News Now editorial staff:
- Increased interest in primary markets drives Q3 transactions
- San Francisco hotel employee strike unresolved
- Owners, asset managers shift practices with resort fees
- Chinese authorities reacting to unsanitary cleaning at hotels
- Underground travel agents scamming luxury hotels
Increased interest in primary markets drives Q3 transactions: According to a new commercial real estate investment trends and outlook study by JLL, the third quarter saw an increase in opportunities in primary markets as well as the highest amount of entity-level transactions since 2007. Real estate transaction volumes increased 14.2% to $341.2 billion, the study shows.
The study also noted that while the U.S. economy “is in the second-longest growth cycle on record,” there will be a shift to a period of moderated growth in some markets.
“As the 10-year treasury rate remains volatile and trends higher, markets are expected to witness tightening spreads which will make acquisitions more expensive,” according to JLL.
San Francisco hotel employee strike unresolved: Although hotel workers in San Diego involved in a nationwide strike at hotels owned or managed by Marriott International and represented by Unite Here Local 30 ratified a new contract earlier this week—ending its 35-day strike—San Francisco workers aren’t having aren’t having the same luck. According to the San Francisco Chronicle, San Francisco’s strike will last through the Thanksgiving holiday week “amid a contract dispute.”
“Marriott’s proposal doesn’t come close to preserving affordable health care, giving us the livable incomes we need to survive, or ending the pain and injury caused by unsafe workloads,” a Unite Here Local 2 spokesperson said in a statement. Housekeepers in San Francisco make an average of $45,000 per year, the union said.
The protests have reportedly led to event cancellations and reduced services at the hotels. And Marriott and its contractor has had to bus in temporary workers. Holden Lim, president of Hospitality Link International, a hotel consultant firm in San Mateo, California, said it is unclear if the strike is pushing room rates down.
Owners, asset managers shift practices with resort fees: Asset managers and owners recognize that amenity and resort fees are viable sources of revenue to the bottom line. Now the trend is expanding into urban luxury and full-service hotels, but sources urge hoteliers to take a thoughtful approach, writes Hotel News Now’s Dana Miller.
“We’re in an environment where profits for the industry on a per-room basis will barely increase in 2018. It will barely keep up with inflation,” said Bjorn Hanson, clinical professor at the Tisch Center for Hospitality and Tourism at the New York University School of Professional Studies. “So owners and managers are looking for ways to gain other sources of revenue.”
Many times that begins with resort fees, he said.
Chinese authorities reacting to unsanitary cleaning at hotels: Several major international hotel companies are under fire after a hidden camera video that showed housekeepers at properties in China using “soiled towels to clean cups and glasses and other questionable practices” was posted online, according to USA Today.
“The Chinese tourism ministry said late Thursday that it had asked authorities in Beijing, Shanghai and three provinces to investigate 14 hotels that appear in the video. Several of the hotels including a Sheraton and Waldorf Astoria have apologized,” the news outlet reports.
Underground travel agents scamming luxury hotels: An underground trade is allowing guests to book rooms at luxury hotels in places like New York City, Bangkok and Barcelona at a fraction of the cost, according to a report from Motherboard. How is this possible? The sellers are “obtaining the rooms through stolen loyalty point accounts, abused employee discounts or corrupted hospitality insiders.”
“Typically, the travel agents advertise their price along with other information such as how many days in advance of travel the client can book. Some underground travel agencies offer all-inclusive services, with flights, hotels, and taxis all covered by one price, according to a website flagged to Motherboard by cybersecurity firm Trend Micro,” Motherboard reports.
Compiled by Dana Miller.