“Region's hotels hope to regain pricing power” plus 1 more |
| Region's hotels hope to regain pricing power Posted: 09 Jan 2011 01:55 PM PST After a better-than-expected 2010, Orlando's hotel industry could see gains in business again this year, with better room rates and higher occupancy both in the cards. Demand for lodging nationwide is rising again, and a lack of hotel construction should give operators of existing properties some breathing room. Orlando-area hotels are expected to fill 63 percent of their rooms on average this year, an increase of about 1.8 percent compared with the expected outcome of 2010, according to Colliers PKF Consulting USA. Colliers expects Orlando hotels will wrap up 2010 with occupancy up 5.5 percent compared with 2009. The average daily room rate this year is forecast to be about $99 a night, up about 4 percent from last year, when rates were down less than 1 percent from 2009. Smith Travel Research, another hotel-tracking company, predicts a more robust year, with average occupancy in the Orlando market forecast to grow between 6 percent and 8 percent, and prices rising 3 percent to 5 percent. Renovations rather than construction After several high-profile openings in 2009 and 2010, hotel development in the Orlando area is expected to be scarce in 2011. With financing still tight, developers are likely to continue having a hard time getting deals done this year. In the Orlando market, just one property — a 119-room Staybridge Suites near the University of Central Florida — is slated to open in 2011, according to Lodging Econometrics, a Portsmouth, N.H., company that tracks hotel development. "There are definitely some projects that are sitting, waiting," said Bruce Ford, the firm's senior vice president. With new construction on hold, some owners and investors could look to renovations as a way to keep their brands fresh in the market. The new owners of the Sheraton Safari Hotel and Suites near Disney World kicked off the year by announcing a $25 million renovation of the 489-room hotel, a project that includes the addition of a 6,200-square-foot conference center. "It's going to be the year of renovation," Ford predicted. If the industry's recovery remains a slow one, hoteliers working to put more heads in beds could face pressure to become even more efficient in how they operate, said Scott Smith, a lodging instructor with the University of Central Florida's Rosen College of Hospitality Management. Among possible trends this year: outsourcing or clustering certain operations, such as combining sales teams for sister hotels or running centralized laundry facilities. "As the market grows slowly, the only way you're going to be able to improve the bottom line is to reduce expenses," Smith said. "The efficient hotels are going to be the winners." Time shares hoping for recovery The region's time-share industry expects 2011 to be a recovery year. The industry was slammed late in 2008, when the global financial crisis put the squeeze on credit, making time-share sales and development all but impossible. After falling from $10.6 billion in sales nationwide in 2007 to an estimated $6.3 billion in 2010, the industry — much of it based in Orlando — is looking for a little growth this year. During the credit crunch, many companies refined their sales efforts, focusing on more-creditworthy buyers, requiring bigger down payments, and dropping inefficient marketing models. "I think we now have hit the bottom and are working our way up, but with better fundamentals," said Howard Nusbaum, American Resort Development Association president. With little in the way of new construction, Nusbaum thinks time-share operators could play a role in reducing the nation's backlog of unsold condominium units. Resort-area condo developments that failed as whole-ownership projects could, in some cases, be converted into time shares, he said. Slimmer Builders Show returns Orlando's convention industry kicks off 2011 with its biggest trade show of the year: the annual convention of the National Association of Home Builders, this week in the Orange County Convention Center. The NAHB's International Builders Show returns to Orlando after a two-year rotation in Las Vegas. The mega show, which routinely drew about 100,000 people when it was in Orlando for four straight years starting in 2005, is expected to pack a lot less of an economic punch this time around. This year's show is expected to draw 55,000 people to Orlando, according to convention center estimates. The show's organizers have attributed the steep decline in attendance in recent years to the nationwide housing slump, which put thousands of builders out of work. Even on a diet, the show will likely be the fifth-largest in Orlando convention history, trailing only its 2005-08 predecessors. Other big-ticket conventions scheduled for Orlando this year include the PGA Show, expected to draw 43,000 people in January; the Healthcare Information Management and Systems Society, slated to bring 30,000 in February; and CTIA, the Wireless Association, with 26,000 in March. Overall, the Orange County Convention Center has 205 events on its calendar so far for 2011, compared with 199 events in 2010. The center is also expecting an increase in combined attendance, from 1.1 million people last year to 1.3 million this year. Sara K. Clarke can be reached at skclarke@orlandosentinel.com 407-420-5664. This entry passed through the Full-Text RSS service — if this is your content and you're reading it on someone else's site, please read our FAQ page at fivefilters.org/content-only/faq.php |
| Posted: 09 Jan 2011 05:19 PM PST China's economy hotel brands are set for a rapid expansion this year with huge business potential, but a related issue is the urgent need to ensure order in the market between rivals, industry watchers said Sunday. The Nasdaq-listed Home Inns & Hotels Management Inc announced Friday that it planned to open a record 260 to 280 new hotels in 2011, of which 100 to 110 will be leased-and-operated hotels, and 160 to 170 will be franchised-and-managed units, according to an announcement on its website. The target is to take the total number of Home Inns' hotels to 1,100 this year. "Throughout the recovery from the recent economic slowdown, we have rebuilt a strong development team and implemented effective development strategies," David Sun, CEO of Home Inns commented on its website. "We believe Home Inns, is well positioned to invest in the future and achieve sustainable long-term growth." Another Nasdaq-listed domestic company, China Lodging Group Limited, announced January 4 that it planned to operate and manage more than 1,000 hotels in 100 cities by 2013. The 7 Days Group Holdings, listed on the New York Stock Exchange, has already opened more than 500 budget hotels in China. It plans to open at least 240 stores more this year, China Business News reported. An industry watcher said that due to the huge market potential, Chinese economy hotel brands expanded much faster than some foreign budget hotel brands including Super 8, which is affiliated to Wyndham Hotel Group. "The demand for budget hotels in China is very large, and there is room for further growth," Zhao Huanyan, chief consultant of SAO Hotel Solution Consulting, told the Global Times Sunday. "Each operator tries to occupy as much market share as possible," Zhao said. According to a report filed with CIC industry research center, more than 80 percent of businessmen from small- and medium-sized companies and officials of public functionaries choose budget hotels during their business trips. However, serious competition has also given rise to practices such as price wars in the hotel market, said Zhao. He cited a typical instance: "Two brands, in their competition to rent a property to manage their own brand hotels, were directly responsible for the rental rate soaring from 0.7 yuan ($0.11) per square meter per day to 2 yuan ($0.30)." "Such a trend will put too much pressure on the hotels," said Zhao. "The solution is for the hotels to set up an association among themselves to coordi-nate market demand and rates in a healthy manner," Zhao added. Source: Global Times This entry passed through the Full-Text RSS service — if this is your content and you're reading it on someone else's site, please read our FAQ page at fivefilters.org/content-only/faq.php |
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