Skift Take
The opportunities for steep discounts on hotel real estate from the pandemic are fading, as property owners are increasingly optimistic about what the vaccine can do for summer travel demand.
Early Check-In
Editor’s Note: Skift Senior Hospitality Editor Sean O’Neill brings readers exclusive reporting and insights into hotel deals and development, and how those trends are making an impact across the travel industry.
What would typically be a normal downturn in the economy sparks an investor feeding frenzy among those waiting to pounce on deals in industries facing tough times.
But nothing about the ongoing global pandemic is normal.
We’re barely halfway through hotel earnings season, and major companies like Hilton and Marriott all report losing hundreds of millions of dollars last year. Some are closer to billion-dollar losses than they are to breaking even.
With the ingredients all there for disruption, transactions, and dealmaking, we decided to launch a weekly briefing to give you the full story. A real estate sale often has greater implications. A brand acquisition can point to where the future of the entire hotel industry is heading. A developer’s television soundbite can send an entire industry scrambling to follow trends.
Join us every Monday, as you are now, for the Early Check-in. We’ll have a rundown of deals, transactions, and developments you should be following and how they will impact the travel industry and those who count on it. Now onto the news:
The Hotel Deals Already Flew the Coop
The CEOs of some of the world’s largest hotel companies are now adding to the emerging school of thought that the best days for finding a pandemic bargain on a hotel asset are behind us.
Hyatt took a $30 million loss when it sold the Hyatt Regency Baku in Azerbaijan last quarter for $11 million. While there were other hotel sales in the second and third quarter across the industry that were 20 to 30 percent below their pre-pandemic values, those kind of deals are “quickly evaporating,” Hyatt CEO Mark Hoplamazian said last week on an investor call.
While the hotel industry is years away from a full financial recovery from coronavirus, executives like what they see for the months ahead. Vaccine distribution continues to accelerate, and Hoplamazian even thinks group business and event travel may come back much faster than previously imagined.
Blissful Ignorance?: The optimism is a disconnect from how the hotel i