Europe Hotel Pulse for Jan. 20
Europe Hotel Pulse for Jan. 20
20 JANUARY 2021 9:53 AM

Paris Inn Group Restructures to Help Grow Maison Albar Brand Internationally; Whitbread Halves Rent Payments to Landlords; and More.

STR: Europe Hotel Performance for November 2020
With many parts of the continent having gone into a second lockdown in the last months of 2020, Europe’s hotel industry reported much lower performance levels from the prior month, according to November 2020 data from STR, parent company of Hotel News Now.

In Euro constant currency terms, performance in November 2020 as a percentage change from October 2019, saw occupancy fall 70.4% to 21.3%, average daily rate decline 32.3% to 72.42 euros ($88.46) and revenue per available room decrease 81.2% to 14.42 euros ($17.61). STR analysts said the month’s occupancy level was the lowest since May.

Belgium has shown for the same month worse numbers than that average, with its occupancy declining 82.9% to 13.1%, ADR declining 32.8% to 77.80 euros ($95.03) and RevPAR declining 88.5% to 10.21 euros ($12.47), which present the country’s lowest occupancy and RevPAR since May and the lowest ADR in all of 2020.

Restructured Paris Inn Group Seeks to Grow Luxury Brand
Paris Inn Group restructured itself on Jan. 1 into five distinct divisions to portray a clearer picture of its growth strategy to investors, which includes greater emphasis on the international rollout of its in-house Maison Albar brand. The move has received funding from Los Angeles-based investment firm Oaktree, which also is considering subscribing to a 115.2-million-euro ($141.3-million) bond issuance.

That bond, convertible into preferred shares, will be issued by Paris Inn Group’s new structure, named Centaurus, with the target being to create the third-largest hotel operator in France and Europe, after Accor and Louvre Hotels Group. Its officials said the deal, one of the largest in France in 2020, will “continue to develop our group in the post-crisis period, which will inexorably begin in a few months, with renewed ambition to reach 1 billion euros ($1.22 billion) of turnover by 2030.”

European Hoteliers Adapt to Growing Staycation Demand
With lockdowns continuing throughout Europe, 2021 will follow 2020’s trend of the staycation dominating leisure travel demand, but with no one now flying to different markets for their holidays, demand domestically often outstrips supply. To get their share of wallet, operators and brands are upping their sales and marketing strategies with incentives and initiatives to make their properties more attractive than their competitors’ offers. Remoteness, style and low-key luxury will be the buzzwords for the season.

Hoteliers say that due to less up-front costs such as flights, guests have more money for F&B, spas and other offerings. “The demand is for high-end country-house hotels, which is what we are,” said Nick Davies, co-owner of The Cottage in the Wood in Malvern Wells, England.

Whitbread Halves Rent Payments to Landlords
Whitbread PLC, the parent company of the United Kingdom’s largest economy hotel brand, Premier Inn, has told its landlords that it is able to pay only 50% of the fourth-quarter 2020 rent owed by it. The firm has until now been paying its full rent, reports Paul Norman, managing editor, CoStar News, published by CoStar Group, the parent company of STR, which HNN is a division of.

Mark Anderson, managing director, property and international at Whitbread, in a letter to landlords said the firm is asking “landlords, who have been the only stakeholders not to have shared some of the pain to date, to provide a proportionate degree of temporary financial support.” He added company officials believed the group’s strategy is “as relevant as ever, having taken quick and decisive action to protect the business when the national lockdown was first announced in March.”

Whitbread is Confident Despite Job, Rent Cuts
Whitbread PLC announced its third-quarter 2020 results on Jan. 14, with its CEO Alison Brittain saying despite asking landlords to reduce rent payments and a second wave of COVID-19, she is confident of the firm’s future, citing plateauing coronavirus cases, the rollout of several vaccines and the summer weather to come likely to buoy traveller sentiment.

“It is the return of confidence that is so important to the economy,” she said. For the 13 weeks of trading up to Nov. 26, the owner of Premier Inn reported occupancy of 49.3%, although Brittain added that number came in at 8.9% percentage points above the average for the midscale and economy market. She said total U.K. revenue declined year over year by 55.2%.

Deals and Developments

  • The 150-room Scandic Arlandastad reopened on Jan. 11 near Stockholm’s international airport, Arlanda, following an agreement Scandic Hotels signed in November to take over its management.
  • Owner Z Capital Group has signed an agreement with Marriott International to have its 107-room Waldhaus Flims Wellness Resort in Flims, Switzerland, join Marriott’s soft brand Autograph Collection, the first of such hotel in the Swiss Alps.
  • InterContinental Hotels Group opened the 120-room Voco Strasbourg Center - The Garden, its second Voco-branded hotel in France.
  • Real estate investor Antirion SGR and Rosewood Hotels & Resorts are set to open in 2023 the 157-room Rosewood Rome in the former headquarters of the Banca Nazionale del Lavoro. It will be the fourth hotel for the company in Italy.
  • Osborne+Co has received planning permission to build a 100-million British pound ($136 million) mixed-use development in the former Glasgow College in the Scottish city, a project that will contain a 260-room, 11-story hotel.
  • The 33-room Berd’s Chișinău MGallery Hotel Collection opened at the end of December in Chișinău, the capital of Moldova, Accor’s first hotel in the Eastern European nation.
  • Real estate investment firm Activum SG has bought the 259-room Nobu Hotel Barcelona from Selenta Group for an undisclosed price. The asset, the sixth hotel the firm has bought in Spain, was completed in mid-2020 but has yet to open due to the coronavirus pandemic.

Compiled by Terence Baker.

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