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In These Dark Times, An Aloft Hotel Might Be Hard (But Not Too Hard) To Find

Did you hear? Everything sucks! Gas prices are high! The economy is not doing so well! And really, really scary stuff is happening on Greyhound buses.

Things ain't good, folks, and the New York Times assures us today that the hotel industry isn't going to get out of all this suckiness unscathed.

In "Terrible Timing for a Hotel Boom," the Times gently points out that it's kind of ironic (in the sad "rain on your wedding day" way that Alanis sings about -- so more like unfortunate) that the hotel industry saw high occupancy rates over the last few years but now, in the year so many hotel chains have chosen to expand at a crazy pace, occupancy rates are down -- and occupancy in some destinations, like Maui, have already "fallen off a cliff." 85% last year to 67% this year. Ouch.

So some hotel chains are going to put the brakes on. Yes, this includes Aloft.

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Andaz, Another New Hyatt Brand

We highlighted a report last week that hotel chains had launched 24 new brands in the past 24 months, but Hyatt doesn't want to slow down the pace. They just announced the launch of new brand Andaz, with the first opening slated for this September in London. Another Andaz brand will open across from New York's Public Library on Fifth Avenue but no opening date has been set.

It seems Andaz is another case of out with the old (that's the Great Eastern Hotel atrium pictured here) and in with the new--some word that they say means "personal style."

Have you just yearned for a hotel that is not quite a Hyatt and not quite a Park Hyatt? To the marketing consultants who live and breathe this kind of thing, apparently those two brands are like ebony and ivory. They saw vast white space on their charts that needed to be filled in:

Hyatt is calling the Andaz brand an unpretentious upscale alternative focusing on "casual elegance" and "local identity," which it is positioning in between its Park Hyatt and Hyatt Hotel brands. CEO Mark Hoplamazian said in a statement that Hyatt's "worldwide customer base is looking for fresh, uncomplicated luxury that is timeless and gimmick free."

We've got to hand it to a corporate communications department that can put a new brand called "Andaz" and the words "gimmick free" in the same press release while still keeping a straight face.

[Photo: mole-volio]

Related Stories:
· Hyatt Unveils Luxury Brand With New York, London Plans [BTN Online]
· You're staying where? Hotel Chains launch 24 new brands [HotelChatter]

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You're Staying Where? Hotel Chains Launch 24 New Brands

If you are feeling out of it because you don't recognize all those hotel brands on display in the U.S. city you're visiting, you're not alone. It's hard to keep track when an average of one new brand a month gets slapped on building signs. According to a study from PriceWaterhouseCoopers released last month, "there were a total of 24 new hotel brand launches in the U.S. in 2005 and 2006, which is the largest number of brand introductions in a two-year period since 1989."

The Wall Street Journal picked up on this interesting facet: "In luxury hotels alone, 11 brands have been launched, including the Waldorf-Astoria Collection by Hilton Hotels Corp., and LXR by an affiliate of Blackstone Group." (Story reprint here.)

Why so many new brands? We think it's partly because the old ones are viewed as, well, old. The PWC study highlights "the increasing representation and influence of Gen-Xers and Millennials." As in, "We want a hotel that's not geared to our buttoned-up dad."

Some of these brands we don't even recognize and some are little more than a hotel version of vaporware at this point (aloft is in the virtual world of Second Life, but not yet in the real world.) Others we've covered here in some fashion or another, including James, Palomar, and Hyatt Place--a rebranding of the old Amerisuites chain.

The downside of this is more confusion and further segmentation of an already super-segmented market for your lodging dollar. The upside is that there are more places for you to earn and use points in a hotel chain's frequent guest program.

[Photo: late night movie]

Related Stories:
· Number of New U.S. Hotel Brand Launches in 2005/2006 [PriceWaterhouseCoopers]

Tags: Hilton Hotels / Hotel News / Hotel Industry / → All Tags

Hilton Hotels' Earnings Point to a Fountain of Cash

Don't feel sorry for the Hiltons any time soon. Hilton Hotels released its earnings this morning and we wouldn't blame the execs if they called it a week and went partying in the Caribbean like CNN execs did last week.

Hilton Hotels posted a greater than expected rise in earnings for the fourth quarter, exceeded profit projections for 2006, and the company expects everything to keep looking rosy for the coming year. If you're the type that likes to decipher financial-speak, you can get the whole Hilton press release here.

But we'll supply the condensed version. 1)Room rates were sky-high in 2006, so 2)Profits were sky-high in 2006, and 3)Rates and profits are expected to be champagne-popping-worthy in 2007. Hilton said revenue in the quarter more than doubled to $2.23 billion (yes that's billion with a b) compared with the $2.2 billion expected by Wall Street.

As we've continually reported here, hotel rates hit a record across the board last year, due to strong demand and somewhat limited supply, especially in the most expensive markets. This wasn't all about the high end, however, as the company was able to raise prices in every budget category including their Doubletree, Hilton Garden Inn, and Homewood Suites by Hilton brands.

And it seems there's no stopping Hilton. The company still has plans to open 775 hotels in the Americas for a total of 110,000 hotel rooms. Hmm...world dominate much?

[Photo: Hagan.Blount]

Related Stories:
· Hilton Reports Strong Fourth Quarter, Fiscal 2006 Results [Yahoo! Biz]
· It's Official: You Paid More for a Hotel Roomin 2006

Tags: Hotel News / Hotel Deals / Hotel Industry / → All Tags

It's Official: You Paid More for a Hotel Room in 2006

We ran a few different stories throughout the year about hotel rates going up noticeably, especially in markets with ongoing high occupancy, such as New York, D.C, and Boston. Turns out the rates really did go up--all over the U.S.

Smith Travel Research, a number-crunching company that gets quoted in just about every story about the lodging industry, has released its year-end 2006 report. Last year was a banner year for hotels, not such a great year for frugal consumers.

Average room rate increased 7.0 percent to $97.31 and revenue per available room (RevPAR) --- the combination of occupancy and average room rate and a key industry productivity measure --- gained 7.5 percent to $61.69. Industry room supply increased 0.6 percent in 2006 while demand (roomnights sold) gained 1.1 percent. Full year 2006 room revenue increased 8.1 percent to $100 billion.

So despite all the building going on, demand is still increasing faster than supply. The silver lining in the report was that things leveled off a bit in the 4th quarter and occupancy was down a little. So either the price increases have hit the limit of what guests will bear, or it was just a temporary breather.

We think it's interesting that the average rate across the U.S. is less than $100 though. No matter what the aspirational travel magazines would have you believe, far more people are spending a night at Holiday Inn Express and Microtel than they are at the Crowne Plaza and Ritz-Carlton. Maybe it's that free wi-fi...

[Photo: Zoofy the Jinx]

Related Stories:
· 2007 Hotel Forecast Does Not Bode Well For You [HotelChatter]