Skift Travel News Blog

Choice Hotels, a U.S.-based franchisor, said on Tuesday it had opened an average of more than four hotels a week in the first half of 2023 — a 39% jump year-over-year. The steady onboarding of properties was one reason it reaffirmed its profit forecast for the year despite some industry concerns about leisure demand patterns in the U.S. going into reverse.

Choice Hotels opened 107 hotels in the first half of the year, with an increase in conversion hotel openings of 45% and a rise in new construction hotel openings of 24%. The gains were impressive in a hotel sector where interest rate uncertainty had raised concerns about the willingness of banks to endorse hotel development.

The first-half openings growth was across all segments. Openings in the upscale segment were by 83%, the midscale segment by 42%, the extended stay segment by 50%, and the economy segment by 11%.

“The company remains optimistic about extended stay franchise business growth and expects the number of its extended stay units to increase at an average annual growth rate of more than 15% over the next five years,” it said in a statement.

The positive news helped the company re-commit to its previously provided financial guidance for full-year 2023, where it forecasts net income — a measure of profit — of between $255 and $265 million.

The news is positive at a time when analysts have become more cautious about the hotel sector. For more context, see “Analysts Pare Back Enthusiasm for Hotel Companies.”

Investors closely watch trends in another metric, adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA). The news on that front was also positive relative to its peers.

“In 2024, Choice Hotels expects to generate more than 10% adjusted EBITDA growth at the midpoint, year-over-year, driven by approximately $20 million in incremental contribution from [the merger with] Radisson Hotels Americas as well as organic growth in more revenue intense segments and markets, strong effective royalty rate growth, and other factors.”

For more, see “Choice Hotels’ Brands, Explained.”

The amount of time a first-time visitor visa applicant in India has to wait for an interview has fallen from an average of 669 days in mid-March to 337 days in early April, a 50 percent drop, according to the U.S. Travel Association. 

The industry lobby group attributed the wait time reduction to the State Department’s initiatives this year to reduce the visa backlog. In India, it has put in place a number of initiatives, such as bringing processing staff in on weekends, making embassies available to Indian nationals in other countries and hiring more staff.

“The results we’re seeing in India are proof that—with the right tools—State can make significant progress on this issue,” said U.S. Travel Association President and CEO Geoff Freeman in a statement. “However, there is clearly more work ahead to lower wait times worldwide.”

India is one of the U.S.’s top source markets that are experiencing long visa processing times, which reinforces a Skift megatrend that border bottlenecks will slow the recovery of international travel. Brazil, Mexico and Colombia wait times are at 511 days, 590 days and 752 days, respectively, as of April 14, according to U.S. Travel. The State Department has put in place initiatives in those countries similar to the ones it put in India.

Applicants in India had an especially absurd wait time. In January, for example, they had to wait 999 days for an interview at the Mumbai embassy. 

The country’s rough visa situation was caused by embassies being “shut down completely” by a presidential proclamation during the pandemic combined with the country’s historically high (and now pent-up) demand for all visa categories, said Deputy Assistant Secretary of State for Visa Services Julie Stufft in an interview with Skift.

U.S. Travel encouraged the State Department to continue the initiatives that have proven effective in India in other countries. It also pointed out that competitors are taking away U.S. global travel market share by allowing visa-free travel from the visa backlogged markets. The European Union, for example, allows travelers from Mexico, Brazil, Colombia, Argentina, Israel and Venezuela to visit without a visa.

“No one will wait years for a visa to visit the U.S. when so many other countries welcome global travelers with open arms,” said Freeman. “The State Department must continue to make international visitors an economic priority before we lose them to other destinations.”