Skift Take

Analysts become more cautious about leisure travelers' demand for hotels. Plus, more highlights from this week's news in hotel deals and development worldwide.

Series: Daily Lodging Report

Daily Lodging Report

Skift’s Daily Lodging Report is a subscription-required, email-only newsletter read by anyone and everyone in the hotel investor, owner, and operator space, including CEOs of some of the industry’s top brands. It covers North America and Asia Pacific with two separate regional editions.

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Here are the top stories from Daily Lodging Report in the past week. If you’re not a subscriber, you should be. Get news on hotel deals, development, stocks, and career moves. Sign up here, now.

Analysts Become Modestly Less Bullish

Last week, we noted that analysts for Morgan Stanley modestly sliced their price targets on several lodging companies. This week, a few other analysts at other firms made similar moves largely out of concern with leisure demand trends being softer than expected.

Barclays said with headline revenue per available room (RevPAR), a key industry metric, below their prior growth expectations, they expect some REITs (real estate investment trusts) will be disproportionately impacted. Names its analysts are wary about include Pebblebrook Hotel Trust and DiamondRock.

Oppenheimer‘s analysts pared back their price targets on most of the lodging stocks they cover. They cut Chatham Lodging Trust’s price target to $12 from $14, RLJ Lodging Trust to $13 from $15, Braemar to $5 from $6, and Apple Hospitality to $19 from $21.

JP Morgan lowered 2024 estimates on Wyndham Hotels & Resorts to reflect the softer U.S. economy and midscale chains scale segment results. Wyndham estiamted revenue per available room to be down 1% quarter to date. Wyndham’s hotels in these segments account for 96% of its domestic U.S. rooms base and 56% of its worldwide rooms portfolio.

The analyst moves need to be kept in perspective. Barclays remained bullish on Apple Hospitality, which they said would outperform as its segments (upscale, limited service) are still up year over year. Oppenheimer maintained its “outperform” ratings on all these companies. JP Morgan continues to be relatively positive on Wyndham, too.

We interpret these decisions to mean that analysts believe the hotel sector may be comparatively more resilient than other sectors during macroeconomic choppiness.

Thailand Attracts Hotel Investment

Thailand is an attractive area for hotel groups to invest in as its tourism sector rebounds post-pandemic. The Association of Thai Travel Agents is predicting the return of Chinese tourists will contribute to the country’s international visitor goal of 30 million this year.

Radisson Hotel Group told the media they will open more premium and luxury hotels in Thailand over the next five years. The Radisson RED Phuket Patong Beach, Radisson Resort Phuket Mai Khao Beach, and Radisson Hotel Ploenchit Bangkok are scheduled to open early next year. In the past 12 months, RHG has added seven new hotels in Thailand with over 1,300 rooms.

Wyndham Hotels & Resorts said they expect to open more than 15 hotels with 5,000 additional rooms in Thailand across multiple brands. Wyndham currently has 22 properties in Thailand.

IHG Hotels & Resorts announced the signing of Hotel Indigo Bangkok Thonglor, in partnership with Recha Estate Co. Ltd. The 250-room property will be located in one of Thailand’s trendiest districts and is scheduled to open in 2026.

India’s ITC May Spin Out Hotels

Yes, we’ve reported this before, back in September. Indian conglomerate ITC might spin out its ITC Hotels unit.

ITC is looking at finalizing the long-standing proposal for demerging its hotels business. The Indian tobacco and hospitality conglomerate is considering a separate listing after a strong recovery in the industry. In the past 12 months, ITC has opened nearly one hotel every month for its recently launched brands Mementos and Storii and its existing brands Welcomhotel and Fortune.


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