Atlas in the news

Americas Hotel Pulse: IHG’s Newest Midscale Brand

Hotel Performance in Hawaii; Insights from Hotel Data Conference; and More By Dana MillerHotel News Now August 23, 2023 | 5:31 AM IHG’s New Midscale Brand IHG Hotels & Resorts unveiled its newest and 19th brand, Garner, which will initially be focused in the U.S. and be positioned as a midscale conversion brand, reports Hotel News Now’s Terence Baker. CEO Elie Maalouf said during IHG’s 2023 earnings call that the new brand will be launched later in the year, and there’s already 100 hotels involved in contract negotiations. In the next 10 years, the brand is expected to have roughly 500 U.S. hotels rolled out, then increasing to 1,000 by 2043. Hawaii Wildfires’ Impact on Hotels Deadly wildfires began on Hawaii’s Maui Island on Aug. 8, killing more than 100 people and billions of dollars in damage. It’s also had a noticeable impact on hotels, reports STR analysts Isaac Collazo, Chris Klauda and William Anns. STR is CoStar’s hospitality analytics division. “For the week ending Aug. 12, occupancy declined in two Hawaiian hotel markets, according to CoStar data. Maui, where at least two hotels are included in the destruction toll, recorded a weekly occupancy of 57.1%, down 14 percentage points from the previous week….

Bay Area hotels selling at similar rate to Great Recession of 2009, report warns

Aug 21, 2023 By Alex Barreira – Staff Reporter, San Francisco Business Times Updated Aug 21, 2023 4:52pm PDT The rate of hotel sales across the Bay Area and around California has fallen as sharply in the first half of this year as any point since 2009. Across Northern California including all nine Bay Area counties there have been 62 hotel deals through the end of June, or 45% fewer than the 112 over the same period in 2022, according to a new report from Irvine-based hotel consultancy Atlas Hospitality. The decline statewide of 53% is the most since a 51% decline in 2009, the last year of the Great Recession. Atlas Hospitality president Alan X. Reay wrote that the hotel market is bearing out several similarities to 2009, in which there is a “huge disconnect” between hotel sellers and the buyers that would have to take on commensurate loan obligations. “We are now seeing an uptick in the notice of default filings and foreclosures, as well as borrowers simply handing the keys back to the lenders,” Reay wrote in the report. “As long as interest rates stay at their current levels there is going to be more pressure on sellers and lenders…

Hotel Sales in California Plunge Amidst Investor Exodus

ByJames Forsyth – Aug 18, 2023 The Bay Area and Southern California are experiencing a significant downturn in hotel sales, as investors quickly exit the market. According to the San Jose Mercury News, the number of hotels sold in California during the first half of the year has plummeted, surpassing the lows seen during the Great Recession. Data from Atlas Hospitality Group reveals a 52.9% drop in hotel sales from January to June compared to the same period last year. These figures are even worse than the 51% decrease witnessed at the end of the recession in 2009. Alan Reay, President of Atlas Hospitality Group, expressed his concerns, stating that the industry had never experienced such a severe decline. Both Northern and Southern California have been hit hard, with Southern California experiencing the sharpest decline. Hotel sales in this region fell by 58.9%, with only 62 hotels being sold in the first half of the year compared to 151 in the same period last year. Northern California also saw a significant decline of 44.6%, with only 62 hotels sold compared to 112 in the previous year. While both regions still witnessed major hotel deals, the number of foreclosures in the…

Report: California hotel sales drop to lowest level since Great Recession

CHERYL SARFATY THE NORTH BAY BUSINESS JOURNAL August 17, 2023, 7:09PM Sales of California hotel properties for the first half of 2023 have fallen more than 53% compared to the same time last year, according to a company that tracks hotel sales. In its newly published hotel sales survey for midyear 2023, Newport Beach-based Atlas Hospitality said the year-over-year drop is the steepest seen in the 26 years the commercial real estate firm has been in business. Further, hotel transactions priced over $5 million declined by 55% in the same time frame. “The only other year we have seen such a significant decline was in the first half of 2009, when individual (hotel) sales were down 51%,” the report stated. The reason is “almost exclusively” because of the “rapid” increase in interest rates, according to Atlas. The prices sellers are looking for don’t align with the cost buyers must pay for loans. When Atlas released its midyear hotel development report earlier this month, Alan X. Reay, president of the firm, told the Business Journal that high-interest rates have lenders feeling skittish — whether it’s for a hotel project or a hotel sale. “You have lenders now that are pulling back…

California Hotel Sales Drop More Than 50%

Activity during H1 2023 is biggest plunge since the Great Recession. By Jack Rogers | August 18, 2023 at 06:03 AM Sales activity for the hotel markets in California imploded in the first half of this year at a pace that seems even worse than the collapse experienced during the Great Recession of 2008 and 2009. The number of hotels sold in California dropped during H1 2023 by 52.9% compared with the first half of 2022, according to a new survey from Atlas Hospitality Group, the Irvine-based firm that has been tracking statewide lodging for more than 20 years, according to a report in SiliconValley.com. The nadir in 2009 for hotel sales in the Golden State was a plunge of 51%. “We’ve have seen nothing like this, nothing this bad,” Allan Reay, president of Atlas, told SiliconValley. The cliff dive was spread across areas of Northern and Southern California. Northern California saw an H1 plunge of nearly 45% in individual hotel sales, with 62 hotels sold in NoCal in the first half of the year compared with 112 during the first half of 2022, Atlas reported. Southern California saw a swan dive of nearly 59%–SoCal matched the total in the north of 62, but this…

California hotel sales plunge by 53% as investors skirt market

Decline eclipses market of the Great Recession: “We have seen nothing like this” AUG 17, 2023, 2:15 PM By TRD Staff Hotel sales from the Bay Area to Southern California are in the lurch, with investors fleeing toward the exits. The number of hotels sold in the Bay Area and across the state plunged during the first six months of the year, exceeding the doldrums of the Great Recession, the San Jose Mercury News reported, citing Atlas Hospitality Group. The number of hotels, motels, inns and lodges sold across the Golden State from January through June fell by 52.9 percent compared with the first six months of last year. At the end of the recession in 2009, hotel sales tumbled 51 percent. “We have seen nothing like this, nothing this bad,” said Alan Reay, president of Irvine-based Atlas Hospitality Group, which has tracked the hotel industry in California for two decades. Both Northern and Southern California suffered huge declines in the number of hotels sold, with SoCal having the steepest fall. Southern California saw a 58.9 percent decline in the number of hotels sold. Some 62 hotels were sold in the first half of the year, compared to 151 in the first…

Climate tough for building, buying hotels

Thursday, August 17, 2023 By Thor Kamban Biberman High interest rates are scuttling many hotel sales, other hotel owners don’t want to sell, and finding financing for new hotels is extremely challenging, according to the latest report from Atlas Hospitality Group. San Diego County’s individual sales decreased 48 percent year-over-year in the first half of 2023, and its total dollar volume dropped 45 percent. There was at least one notable transaction in the county during the first half of the year, however. The Chesapeake Hotel Group REIT and Greenfield Partners, a real estate investment fund, acquired the 133-room Pala Mesa Resort in Fallbrook for $53 million in May. The median price per room for San Diego’s hotels increased 52 percent year-over-year to $230,040 while all the other numbers declined. The county posted 13 hotel sales during the first half of the year, which was about half the number of hotel sales completed during the first six months of 2022, according to Atlas The overall sales volume through mid-year was $200.36 million, compared with $362.54 million during the first half of 2022. In terms of room count, the overall volume in San Diego dropped 51.6 percent year-over-year to just 1,013 during…

San Diego tourism is surging. Hotel sales are plunging. What gives?

Statewide, the decline in hotel sales so far this year is the steepest drop in two decades as lenders shy away from financing multi-million-dollar transactions. BY LORI WEISBERG AUG. 17, 2023 5:30 AM PT San Diego County hotels may be enjoying one of their best years ever as demand for leisure travel continues to ramp up, but that’s not been the case with the hotel real estate market. Hotel sales during the first half of the year posted their single biggest decline — 48 percent — since 2012 when the number of individual transactions plunged nearly 70 percent, according to Atlas Hospitality Group’s mid-year hotel sales survey. For California as a whole, the downward trend was even more dramatic. The volume of hotel sales statewide — 124 — is down 53 percent compared with the same period last year, marking the first time in 20 years that such transactions have fallen so low, said Atlas President Alan Reay. “This is the steepest decline in individual sales we’ve ever seen in the last 20 years of tracking hotel sales. The only year that ever came close to that was 2009 and we remember what happened back then,” said Reay, speaking of the early…

‘Completely Obliterated’: LA County Hotel Sales Drop 53% In Early 2023

August 16, 2023 Bianca Barragán, Southern California  Hotel sales in Los Angeles County declined nearly 53% in the first half of 2023 compared to the same time last year, according to a report this week from Atlas Hospitality Group.  Only 17 hotels in LA County traded hands in the first half of this year, down from 36 sales last year. The county’s largest transaction was the $760M foreclosure sale of the Fairmont Century Plaza Hotel, although the full price tag included the hotel, retail space and some of the condos in the Century City property.  Interest rates are hammering transaction volumes, and buyers and sellers are far apart on offers, Atlas Hospitality Group President Alan Reay said. Even when both parties can agree on a price, often those properties aren’t getting appraised and financed.  Only one hotel transaction over $5M closed in the city of Los Angeles in the second quarter, which was also the first quarter the city’s new tax on transactions over $5M was in effect. Normally, there would be anywhere from 15 to 20 in the second quarter of the year, Reay said.  “We have, on the national scale, what’s happened with interest rates,” Reay said. “You can then apply what the city of Los Angeles has done as of April 1,…

Hotel Sales Plunge in Bay Area and California Amidst Pandemic

By Roy Wright  AUG 16, 2023 Sales activity in the hotel markets of the Bay Area and California has experienced a sharp decline in the first half of 2023, signaling the devastating impact of the coronavirus outbreak on the sector. The number of hotels sold during this period has dropped significantly, reminiscent of the recession in 2008 and 2009. According to Atlas Hospitality Group, a firm that tracks the hotel industry in California, the number of hotels sold in the state decreased by 52.9% in the first half of 2023 compared to the same period in 2022. This decline is even worse than the 51% drop experienced during the last recession in 2009. Both Northern and Southern California have been severely affected by the decline in hotel sales. In Northern California, there was a 44.6% decrease in individual hotel sales, with only 62 hotels sold in the first half of 2023 compared to 112 in the previous year. Southern California, on the other hand, experienced a 58.9% nosedive in hotel sales, with only 62 hotels sold compared to 151 in the same period last year. Amidst this downturn, notable hotel deals have still taken place. In Alameda County, the 276-room…

California’s Hotel Transaction Volume Has Declined Even Sharper Than During the Great Recession

Disconnect Over Prices Keeps Buyers, Sellers at Odds The Fairmont Century Plaza in Los Angeles sold for $760 million in a foreclosure sale during the first half of 2023. (Accor) By Bryan Wroten / Hotel News Now August 16, 2023 | 6:07 AM The number of individual hotel sales in California during the first half of 2023 dropped by nearly 53% year over year. According to Atlas Hospitality Group’s California Hotel Sales Survey 2023 Mid-Year, the number of sales dropped from 263 in 2022 to 124 this year. The average sales price grew 33.6% year over year, but the median price fell by 9.4% to $6.88 million. However, the average price per key increased by 14.3% to $220,276, while the median price grew 12.1% to $160,851. The number of transactions over $5 million dropped from 175 in the first half of 2022 to 79. The overall drop in transaction volume eclipses a decline in 2009 during the Great Recession, Atlas Hospitality President Alan Reay said. “That’s the steepest decline we’ve ever seen in our any of our surveys,” he said. The sales volume in California during the pandemic was a bit of an anomaly, he said. The number of deals was so…

Bay Area, California hotel sales implode as investors flee sector

By GEORGE AVALOS | gavalos@bayareanewsgroup.com | Bay Area News Group PUBLISHED: August 15, 2023 at 12:00 p.m. | UPDATED: August 16, 2023 at 9:22 a.m. OAKLAND — Sales activity for the hotel markets in the Bay Area and California more broadly imploded during the first half of 2023, in a renewed sign of the sector’s collapse following the coronavirus pandemic. The number of hotels sold in the Bay Area and statewide tumbled over the first six months of this year at a pace reminiscent of the nosedive the lodging industry suffered in California in the wake of the recession of 2008 and 2009. “We have seen nothing like this, nothing this bad,” said Alan Reay, president of Irvine-based Atlas Hospitality Group, which tracks the hotel industry in California. Reay would know. Atlas Hospitality has been analyzing the statewide lodging sector for more than 20 years. Specifically, the number of hotels sold in California during the first half of 2023 plunged by 52.9% compared with the first six months of 2022, Atlas Hospitality Group reported. In 2009, at the tail-end of the last recession, hotel sales in California tumbled 51%. Both Northern and Southern California suffered huge declines in the number of hotels sold, Atlas Hospitality reported. Northern…

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