| Condor's Moment Arrives; 46 Hotels Depart |
| Whitbread said last Friday that it had exited the four-star hotel sector. The company arrived at the exit doors at the end of a sales campaign that began in March last year when Whitbread announced that it would be setting up a 50:50 joint venture with Marriott International. This joint venture, which was named Condor, was to hold the 46 hotels – all of them sited in the UK – until they found a buyer. That buyer would acquire the properties, which have a total of 8,102 rooms, on the understanding that Marriott International would retain the long-term management of the hotels, which fly the Marriott and Renaissance flags. The buyer turned out to be Royal Bank of Scotland (RBS), which paid £951.4 million. Whitbread’s share of the proceeds is some £237 million, and Marriott International’s some £100 million. Whitbread will hope to receive an extra £30 million from RBS by June – the month set for the completion of the sale in a separate transaction of the 227-room Leicester Marriott Hotel. |
| Pub Restaurants That Stay Single May Find Whitbread Shortening Their Life | Return to Headlines |
| Whitbread’s disposal of the Marriott hotels means it can speed up the release of £400 million to its shareholders. And while this news might inspire some shareholders into doing the conga around the tables of their nearest Brewers Fayre or Beefeater restaurant, the pub restaurants themselves – in particular those which have no Premier Travel Inn to partner them – will feel no inclination to dance; for only those 271 pub restaurants already married to a hotel and around another 100 to which Whitbread will betroth a freshly built Premier Travel Inn will escape the prospect of being sold. Still, none of the pub restaurants emerged from the year to 2 March 2006 with much credit; Whitbread in revealing its full-year results pronounced itself disappointed with a division that returned a 12.1% decline in operating profit before exceptionals. Perhaps marriage to a Premier Travel Inn will improve the restaurants' life. The budget hotel chain again showed the way with a 30.4% rise, to £139.8 million, in its operating profit before exceptionals. Whitbread as a whole returned a full-year pre-tax profit before exceptionals of £181.1 million (up 13.1% on the previous year) and turnover of £1.58 billion (up 9.2% on the previous year). | |
| Istithmar Launches Istithmar Hotels | Return to Headlines |
| Istithmar, an investment firm based in the United Arab Emirates, has established Istithmar Hotels, a wholly owned subsidiary that will allow the company to put more of its money into the hospitality and leisure sector. Istithmar is already involved in works that include the development of the five-star Atlantis, The Palm, and Canal Point: a mixed-use project, also in Dubai, which will include a luxury hotel. Istithmar Hotels, which will have the experienced Joe Sita as its chief executive, will make purchases in gateway cities worldwide and will establish a chain of budget hotels in the Middle East. | |
| Sharjah National Hotels On Bank's Books | Return to Headlines |
| Sharjah Islamic Bank is reported to have paid the government of the emirate of Sharjah around US$140 million for Sharjah National Hotels. The reported intention of the new owners is to add hotels to a portfolio which includes the 50-villa Marbella Resort Sharjah, the 253-room Hotel Holiday International and the 162-room Oceanic Hotel. | |
| Premier Travel Inn Travels To Dubai | Return to Headlines |
| The Premier Travel Inn brand took time out this week from its pursuit of an upwards-revised target of 45,000 rooms in the UK by 2010 to make its first trip abroad. It would be nice to think the brand flew Emirates to the Middle East; after all, it is the Emirates Group that will be partnering Whitbread in a joint venture that will be making its initial moves in Dubai. Sites for three of the budget hotels – one at the airport, one in Dubai Investment Park and one at Dubai Silicon Oasis – have been identified; these will deliver more than 800 rooms to the emirate by the end of 2008. Whitbread is contemplating the development of up to 4,000 rooms in the other countries of the Gulf Cooperation Council besides the United Arab Emirates (Kuwait, Qatar, Oman, Saudi Arabia and Bahrain) over the next few years. | |
| Extensive Complex In Budapest Is Given The Go-Ahead | Return to Headlines |
| Work is set to begin next year on what one report claims is the largest tourism project, in terms of investment, that Hungary has seen. Property developer Plaza Centers and its co-investors will be spending a reported €1.5 billion on a mixed-use complex on Hajogyari Island in the Hungarian capital Budapest. The five-year project will see perhaps as many as 11 hotels built alongside the likes of a casino and a conference centre. | |
| Cairn Hotel Group Takes Holiday Inn Birmingham City Centre | Return to Headlines |
| Cairn Hotel Group has added a seventeenth property to its collection in the UK. The group did not disclose how much it paid for the Holiday Inn Birmingham City Centre, although one report gave a figure of £17 million. The 280-room hotel was one of 11 Holiday Inn properties in the UK put up for sale by LRG Acquisition in autumn 2005 and is the ninth to have found a buyer. Cairn will have a near neighbour in De Vere Group, which has named the town of Solihull, to the southeast of Birmingham, as one of two sites that it has secured for the development of two new Village Hotel & Leisure Clubs. The other site is in Ashton Moss, near Manchester. | |
| Kingdom Hotel Investments Reports Its Full-Year Results | Return to Headlines |
| Kingdom Hotel Investments (KHI) has published its results for the 12 months to 31 December 2005. They show that the 13 operational hotels in which KHI has a stake saw their combined EBITDA rise by 43.2% on the previous year's figure to finish on approximately US$40.3 million. This increase was led by the Four Seasons Hotel Cairo at Nile Plaza, in Egypt, which in its first full year of operation produced EBITDA of US$11.0 million; the figure for the first four months (August-December 2004) of the 365-room hotel’s life was US$1.1 million. The Mövenpick Hotel Bur Dubai was another with its name in KHI’s full-year honours list. The 232-room hotel saw its RevPAR rise by 48%, to US$118. RevPAR across the portfolio was 23% higher, at US$81. | |
| Accor Presents Its First-Quarter Sales Figures | Return to Headlines |
| Accor saw a like-for-like increase in its revenue of 5.9% for the first-quarter ending 31 March 2006. The company's hotels contributed €1.2 billion (a like-for-like rise of 5.2% on the previous year’s comparable) to the grand total of €1.85 billion. The greatest rise (like for like) in revenue was the 6.6% posted by Accor’s economy hotels in the USA. RevPAR across this portfolio was US$28 (a like-for-like increase of 6.5%). The corresponding figures for the economy hotels in Europe were €33 and 3.9%, and for Accor’s mid-scale and upscale hotels in Europe €55 and 4.5%. | |
| Fresh In This Week | Return to Headlines |
| The breeze off the Atlantic is not the only thing that’s fresh in Funchal on the island of Madeira. Reid’s Palace is perky too, having emerged recently from a bout of extensive renovation. The 164-room hotel is one of two in Orient-Express Hotels’ Portuguese portfolio. Freshness abounds too on the island of Cyprus. Interval International has fallen in love with Aphrodite, or, rather, one component of the Aphrodite Hills Resort near Paphos. The vacation ownership exchange company has affiliated and given its five-star award to the Amathus Vacation Club, which will have its 78 units available in July 2007. Interval International did though leave enough room in its heart to permit the affiliation of Vila Baía: a resort on the Algarve in Portugal built by Oceânico Developments. | |
Absolute Share Price Performance Over the Past Week 20/04/06-27/04/06
InterContinental Hotels Group - Merrill Lynch raised its target price from 870p to 1,030p, stating that the company was well-positioned to deliver good operational growth in the years ahead.
Accor - Jefferies International reiterated its 'Buy' rating as Accor's first-quarter sales came in ahead of Jefferies' expectations.
Whitbread - Deutsche Bank lowered its rating from 'Buy' to 'Hold' and cut its target price from 1,180p to 1,150p.
