From the desks of the Hotel News Now editorial staff:
- A look at why some companies are lowering guidance
- Trump delays Chinese tariffs ahead of holiday buying
- Recession worries increasing
- Asia/Pacific among regions to see construction spike
- Philly Four Seasons opens as 10th highest hotel in US
A look at why some companies are lowering guidance: With weaker-than-hoped-for performance in the first half of 2019, many publicly listed hotel companies revised their full-year 2019 guidance numbers down. Hotel News Now’s Danielle Hess compiled commentary from various hotel executives, shared during Q2 earnings calls, on their thinking behind their guidance numbers.
For example, Tom Baltimore Jr., president and CEO of Park Hotels & Resorts, laid out how overall economic concerns have been a hindrance even for his company, which has enjoyed stronger performance that its competitors.
“Despite our relative strong positioning, global macro concerns have weighed heavily on fundamentals across the industry with annual (revenue per available room) growth forecast contracting across several of our key markets, primarily in the business transient segment,” he said.
Trump delays Chinese tariffs ahead of holiday buying: U.S. President Donald Trump has delayed tariffs on Chinese goods originally scheduled for 1 September in part to help alleviate consumer concerns heading into the holiday shopping season, The Wall Street Journal reports.
The newspaper noted tariffs were meant to hit “many major categories of items, including smartphones, laptop computers and toys.” Tariffs have now been delayed until 15 December.
The market reaction to the news was immediately positive even amid worries over protests in Hong Kong, The Journal reported.
Recession worries increasing: While delaying tariffs is undoubtedly a good sign, economists are increasingly worried the trade feud between the U.S. and China is pushing the former country closer and closer to a recession, Reuters reports.
Reuters points to analysis from Morgan Stanley and Goldman Sachs Group that a recession could be seen sooner rather than later.
It seems economists are hopeful U.S. fiscal policy makers will be proactive in dealing with the issue. A survey of economists conducted by Reuters showed a majority “now expect the Federal Reserve to cut rates again in September and once more next year.”
Asia/Pacific among regions to see construction spike: The latest data from HNN’s parent company STR shows marked increases in hotel construction for both the Caribbean/Mexico and Asia/Pacific regions as of July, while there was a decline in construction in Central and South America.
Asia/Pacific is currently seeing a 27% year-over-year increase in hotel construction, with 2,109 projects and 470,650 rooms in that point of the development pipeline. The Caribbean/Mexico region is experiencing a 33.9% increase of its own, with 155 projects and 31,968 rooms under construction.
Supply growth numbers are much more muted in Central/South America, where construction is down 7.1% year over year to 160 projects with 21,937 rooms.
Philly Four Seasons opens as 10th highest in U.S.: The Four Seasons Hotel Philadelphia at Comcast Center has officially opened and is now one of North America’s highest hotels, according to a news release.
As the 10th highest hotel in the U.S, the property sits between the building’s 48th and 60th floors and has 219 rooms. Construction of the tower and hotel took more than four years.
Compiled by Sean McCracken and Terence Baker.