5 things to know: 10 June 2019
5 things to know: 10 June 2019
10 JUNE 2019 9:09 AM

From the desks of the Hotel News Now editorial staff:

  • Executives at NYU worry about costs
  • CDL scoops up M&C remainder for £776.29 million
  • Thomas Cook confirms Fosun full takeover bid
  • Puerto Vallarta hotels prepare for a slowdown
  • NASA to open up commercial travel to space

Executives at NYU worry about costs: A panel of executives at the recent NYU International Hospitality Industry Investment Conference said increasing costs are a concern for hotel investors, writes HNN’s Sean McCracken.

Watermark Capital Partners has cut down significantly on investments due to rising costs and slowing revenue growth, said Chairman and Managing Partner Michael Medzigian.

“We’ve slowed our pace of investing,” he said. “We were buying at $1 billion a year or a little more. We’re probably at half that today, and that’s the result of flattish (revenue per available room). … It’s hard to underwrite when the top line is moving at a pace below labor costs growth.”

CDL scoops up M&C remainder for £776.29 million: Singapore-based real estate operating company City Developments Limited and wholly owned subsidiary Agapier Investments Limited has agreed to buy the remaining 34.8% of shares of hotel company Millennium & Copthorne, which it does not currently own, according to a news release.

The price is estimated to be £776.29 million ($984 million), which puts the estimated value of the entire firm at approximately £2.23 billion ($2.8 billion). CDL will purchase the remaining shares “through a combination of internal cash resources as well as funds made available to CDL under a credit facility,” the release states.

The deal would make M&C a private company, which is “in line with CDL’s strong focus on boosting recurring income and enhancing underperforming assets,” CDL Group CEO Sherman Kwek said in the release.

Thomas Cook confirms Fosun full takeover bid: Package holiday operator Thomas Cook, which also owns its own hotel brand Casa Cook, confirmed in a regulatory note that its principal shareholder, Chinese firm Fosun International, is in talks with it to acquire the entire business.

The note added the talks do not necessarily mean a formal offer will be placed on the table.

“However, the board will consider any potential offer alongside the other strategic options that it has, with the aim of maximizing value for all its stakeholders,” the release states.

Puerto Vallarta hotels prepare for a slowdown: Puerto Vallarta is preparing for an economic slowdown, which is expected to affect its hotel industry, Vallarta Daily reports. 

The slowdown has led to a 10% reduction in hotel occupancy, said Carlos Elizondo Ramos, VP of Coparmex Puerto Vallarta.

“We have understood since the end of last year that there was going to be an economic slowdown because there was not a well-established social, economic and labor policy in the country, and we are confirming all this as the days go by,” he told the news outlet.

NASA to open up commercial travel to space: NASA announced it will open up commercial travel to the International Space Station (ISS) from 2020, and rates at the space station are priced at $35,000 a night, the BBC reports.

Up to “two short private astronaut missions” will be offered per year, the article reports. NASA stated the private astronauts will be allowed to travel to the ISS on U.S. spacecraft for up to 30 days.

“NASA said that private commercial entities would be responsible for determining crew composition and ensuring that the private astronauts meet the medical and training requirements for spaceflight,” the BBC reports.

Compiled by Danielle Hess.

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