From the desks of the Hotel News Now editorial staff:
- AHIP agrees to sell its economy hotels for $215m
- Atlanta Legionnaires’ outbreak linked to hotel
- Pound falls on Brexit fears to lowest two-year level
- Freitag’s 5: Second RevPAR dip might foretell downturn
- Illegal UK Airbnb rental 'host' fined £100K
AHIP agrees to sell its economy hotels for $215m: Real estate investment trust American Hotel Income Properties announced it has agreed to sell all of its economy hotel portfolio, consisting of 45 assets, for $215.5 million, a price that represents a “capitalization rate of approximately 8.2%, based on trailing 12-months net operating income,” according to a press release.
AHIP said its strategy is to concentrate on its “premium branded hotel portfolio,” which comprises 67 hotels predominantly affiliated with hotel firms Hilton, InterContinental Hotels Group and Marriott International. The buyer was named as an affiliate of VCM Limited.
Atlanta Legionnaires’ outbreak linked to hotel: The recent outbreak of Legionnaires’ disease in Atlanta has been linked to the Sheraton Atlanta, with the Georgia Department of Health stating that there have been 11 confirmed cases and 55 “probable” cases. No deaths have occurred, The New York Times reports.
According to the NYT, the hotel voluntarily closed on 15 July and will open only when the source of the problem has been found and expunged. It is hoped the property will reopen in August, with the newspaper Atlanta Journal-Constitution giving the probable date as 11 August.
Pound falls on Brexit fears to lowest two-year level: The pound sterling fell to its lowest level in two years against the U.S. dollar on heightened fears that the United Kingdom might leave the European Union on 31 October with no deal signed, a scenario that many believe would lead to higher tariffs and uncertainty, according to Sky News.
The idea that a no-deal Brexit could happen has grown on the recent election of Boris Johnson as prime minister. The pound fell to $1.2396, which is the first time it had dropped below $1.24 since March 2017, and “below the ‘flash crash’ rate of $1.2409 of 3 January this year.” Analysts say there could be more damage to the pound’s value.
Freitag’s 5: Second RevPAR dip might foretell downturn: A second consecutive year-over-year monthly decline in U.S. revenue per available room might presage a hotel industry downturn, with June RevPAR decreasing 0.4%, according to Jan Freitag, SVP of lodging insights at STR, the parent company of Hotel News Now.
Room demand increased only by 0.6%, the lowest increase in 2019, with Freitag adding “yes, June room demand (118 million rooms sold) is a new June high, but the industry only sold 700,000 more rooms than a year ago, a very poor showing after selling over two million more rooms in each of the prior months.”
Illegal U.K. Airbnb rental 'host' fined £100K: An Airbnb host who rented out his rented home, one owned by the local authority, London’s Westminster Council, has been fined £100,974 ($123,022) and evicted, according to the BBC.
The tenant started renting out his apartment in 2013, albeit under a false name. The apartment has received more than 300 reviews, and it was those reviews that caught up with the miscreant as at least one mentioned the host’s first name. Airbnb, via a spokesperson, said it reminded hosts to abide by local laws and was the only platform that works with London authorities to limit the number of days—when rentals are legitimate—hosts can rent out their homes.
Compiled by Terence Baker.