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  • New Global Directors Join the 2018-2019 HFTP Board

    The HFTP 2018-2019 Global Board of Directors was installed during the association's 2018 Annual Convention and introduces new directors Toni Bau, Carson Booth, CHTP and Mark Fancourt. These extensive director profiles give insight into the distinguished professions and personal goals of HFTP's newest association leaders.

  • Members Only: 2018 HFTP Compensation and Benefits Report

    By Tanya Venegas, MBA, MHM, CHIA. Results to the biannual survey conducted by Hospitality Financial and Technology Professionals (HFTP). Information includes data on compensation and benefits trends for finance and technology professionals in the club and lodging industries.

  • Primary Club Metrics

    Survey results identify which metrics are most often used to determine performance. By Agnes DeFranco, Ed.D., CHAE; Tanya Venegas, MBA, MHM, CHIA; and Amanda Belarmino

  • Introducing 'Your HFTP': An Updated Online Interface for HFTP Members

    HFTP is excited to announce the newly updated “Your HFTP” online account portal. “Your HFTP” allows you to successfully manage your HFTP membership online. This refreshed online interface looks and feels just like the HFTP website and (better yet) is mobile-responsive.

JLL: 2019 Hotel Investment Volume To Reach $67B

JLLH · 8 February 2019
JLL Hotels & Hospitality has released its annual "Hotel Investment Outlook," describing global investor sentiment as "cautious yet confident."The report projects global hotel investment volume will reach $67.2 billion, nearly equal to 2018's total of $67.7 billion.While the firm expects moderate economic growth and geopolitical uncertainty, hotel property performance remains strong, travel and tourism are anticipated to reach another record year and investors seeking more yield are increasingly turning their sights toward hotels.Key Investment DriversClose-ended private funds raised $28.8 billion globally in vehicles with either a hotel focus or a hotel component as part of a broader strategy in 2018. JLL anticipates these funds will pursue more large-scale investments to efficiently deploy capital and shift strategies toward private debt fundraising.During the past five years, approximately 70 percent of global hotel investments were made by generalist investors who invest in multiple asset classes. Given hotels' attractive yield profile, JLL expects investors will to continue to seek entry into real estate, particularly hotels.In 2018, the largest capital inflows targeted Europe, driven by Middle Eastern and Asian investors. JLL anticipates international activity will increase in 2019, driven in part by inflows to Europe, North America-based investors turning focus toward markets across Asia and cross-border capital exploring portfolio opportunities, including those with assets located outside of primary markets.Top hotel brands account for less than one-third of hotel rooms globally and in 2019, JLL expects to see more targeted acquisitions of unique concepts and locations to complement existing product offerings. "Investment activity exceeded expectation in 2018 and we believe 2019 will be another strong year for global hotel investment, with a significant amount of debt and equity liquidity and competitive bidding for assets, given continued strength in fundamentals," Mark Wynne Smith, global CEO, JLL Hotels & Hospitality, said in a statement. "Notwithstanding the more cautious backdrop, ongoing large portfolio and entity-level activity, hotels' attractive yield profile and record levels of dry powder will drive global hotel investment momentum."Europe Driven by Single-Asset DealsJLL expects investment volumes across Europe, the Middle East and Africa to soften between 5 and 10 percent. The market will be driven mostly by single-asset deals and less by portfolio trades, given the sheer volume of such transactions during the past two years.Diverse sources of core and core-plus capital are increasingly evaluating investment into hotels. Private equity groups and other yield-driven investors will face more competition from investors with a lower cost of capital, therefore continuing to move into more secondary markets like Portugal and Italy.JLL predicts that political uncertainty in the U.K., France and Italy will continue to distract investors, but tourism and business fundamentals remain solid thanks to strong infrastructure developments in the region. As such, the firm to see investors still seeking strong assets and opportunities in these markets.Asia Pacific Transaction Activity to RiseThe APAC region is expected to stand out from a growth standpoint, the report claimed, with hotel investment volumes poised to grow 15 percent year-over-year in 2019.Japan likely will be among the most active markets in 2019, with investor sentiment buoyed by the Rugby World Cup in September 2019 and the Tokyo Olympic Games in 2020, the report found. Investment momentum is expected to build as investors explore selling their hotel assets to ride the anticipated tourism boom.Singapore also is on investors' radars, and hotel transaction activity in China continues to rise. The positive trend in hotel trading performance will continue to push pricing higher.This, together with a favorable tourism outlook, sets the scene for a more liquid marketplace in 2019.Americas: 2018 performance, 2019 projectionActivity in the Americas last year was fueled by luxury hotel and resort hotel sales in the U.S., which posted a 76 percent and 40 percent year-over-year volume increase, respectively, and helped drive a 42 percent increase in total U.S. transaction volume over 2017. In 2019, JLL anticipates total transaction volume for the Americas to match 2018's figure of $36.5 billion. According to the "Hotel Investment Outlook," Americas transaction volume in 2019 will be driven primarily by high-profile resorts, upper-tier select-service hotel portfolios and asset and entity-level portfolio activity. JLL expects private equity to continue its role as the largest buyer group of hotels and for hotel real estate investment trusts to become more active in acquisitions. "Hotel investment and strategy will be heavily linked to opportunity--what is available in the market?" said Gilda Perez-Alvarado, Americas CEO, JLL Hotels & Hospitality. "Irreplaceable properties, access to methods to efficiently deploy large amounts of capital and top locations are all key factors affecting 2019's investment environment."

The Rise Of Poshtels: How Hostels Went From Grit To Glam

JLLH ·14 January 2019
Hostels have traditionally been for backpackers happy to share rooms with strangers, trek down hallways to shower and cook their own meals in basic kitchens in exchange for cut-rate accommodation.But now hostels are increasingly borrowing ideas from more highly-rated hotels: barista-served coffee drinks, late-night cocktails, plush bedding, big-screen TVs and free wi-fi.These hostel-iers seek to capture a slice of the youth market -- specifically groups of friends traveling together, who want to keep an eye on their budget but aren't ready to sacrifice comfort or give up an opportunity to stay at an Instagram-worthy destination.A new monikerThese new-look hostels are even being given a new moniker: poshtels."The hostel experience remains one for people who want something alternative to the traditional hotel chain experience," Lauro Ferroni, a director of research at JLL. "But with some of these new concepts, that experience is no longer synonymous with 'roughing it.'"Some major hotel chains have already set their sights on the category. In October, Hilton launched Motto by Hilton, which will offer something approximating the hostel experience, but with a sophisticated gloss. The rooms -- with an average size of 163 square feet -- will have lofted beds and en-suite bathrooms. Guests who share a room are able to split the cost during the reservation process.Motto by Hilton outposts will be located around Europe, the Americas, the Middle East and Asia Pacific. One of the first under development is in London, on the site of the former Old Marylebone Road hotel. There are others in various stages of development in Savannah, San Diego, Boston and Washington, D.C.Meanwhile, European group Accor has a Jo&Joe offering, which will be opening stylish hostel experiences in Budapest, Krakow and Paris in the next couple of years.Modernizing the sectorThe humble hostel has been a part of the travel landscape since the early 1900s, when a German teacher, Richard Schirrmann, opened the first youth hostel after he realized that the students he was leading on school trips had no place to stay. Through the next few decades, the concept spread through Europe before catching on in other parts of the world.They were originally conceived as dormitories with rows of bunk beds to sleep a dozen or so young people. Later, various room configurations became available, sleeping two or more, but inevitably still retaining the bunk bed format, with a bathroom in the hallway, and not much else to the room. There is typically a communal room by the entrance for lounging and connecting with other backpackers, and limited on-site food and beverage options.Until the early 2000s, prospective visitors often couldn't book online and had to call around or drop in and see if beds were available. Now, hostels are offered on major hotel booking engines such as Expedia.Amid the shift, the sector is being given a second look by investors and developers, who have noted the potential for growth."In the top cities for leisure travelers around the world, hostels offer new opportunities for investors," says Ferroni.Developers may not only be looking at shuttered hotels when looking to create these emergent hospitality spaces, Ferroni says."It can be expensive to convert an existing hotel," he says, adding that former office spaces, for example, could also be reconfigured to accommodate hostels. "Operators are only looking at the top-travelled urban destinations for travelers -- London, Paris, Los Angeles, New York. This is not something that would grow to scale in, say, Tulsa, Oklahoma."An alternative to home-sharing The recent focus on elevating the hostel concept is also a response to the might of Airbnb and other home-sharing sites, which attract groups of friends traveling together, says Ferroni.The more flexible hotel operators are, the more appealing the concept, he added. Moxy, by Marriott, gives guests a choice of options at its year-old south Times Square location, from a standard single room for someone traveling solo to bunk-bed style rooms for a group of friends.Still, while Marriott might be pitching Moxy as an alternative to traditional hostels, the pricing would be a bit steep hostel-goers accustomed to paying as little as $10 a night. On a recent visit to the Times Square property, a room that sleeps two was close to $400 a night.But young travelers and students on a gap year might not be the only audience for the luxe hostel concept. With many of the new hostels offering private rooms and en-suite facilities, they could also welcome families with children and business travelers, Ferroni says."As hotel chains, developers and private equity investors reinvent hostels, it would behoove them to keep in mind shifting demographics and tastes as well," he says.Putting the posh in "poshtel"To differentiate from hostels of yore, poshtels need upgraded the amenities travelers expect: free wi-fi, quality food and beverage and design-led features, Ferroni says. It also needs to provide different lodging options for guests.Generator, which operates hostels across Europe, has flexible room options. In its London outpost, guests can choose between female-only dorm rooms or select a private space. There are late night cocktails at the bar and gourmet-fare in the restaurant. In short, it has the same stylings as a four-star boutique hotel, without the four-star prices."As the hospitality industry transforms, a lot of things are being redefined," Ferroni says. "We're seeing examples of vintage motels becoming hip again, hostels can be fancy - there is creative change."

Renovating to stay relevant: Big hotel refurbishments in 2019

JLLH · 3 January 2019
Replacing worn out carpet, wallpaper and furniture is only one way to breathe life into tired rooms. Remaining ahead of the competition means having the latest back-end IT systems and in-room gadgets."While soft upgrades can offer a temporary refresh, hotels need to keep up with more comprehensive refurbishments," says Sashi Rajan, Senior Vice President, Strategic Advisory & Asset Management, JLL Hotels & Hospitality, Asia.While these projects can be costly and time consuming, they have become increasingly critical, Rajan says. "Such investments allow a hotel to return to where they should be in market in terms of price and position, or to command a leading position."The works completed at these iconic hotels are expected to entice new visitors, as well as deliver an inevitable boost in profitability over the opening months. Find out which hotels are undergoing a makeover fit for 2019.Raffles Hotel, SingaporeHotels don't come much more iconic than the 131-year-old Raffles Hotel. Managed by operator Accor, it's taking bookings beginning August 2019 following a phased renovation program that began at the start of 2017. The revitalized hotel will feature new restaurant concepts from acclaimed chefs Alain Ducasse and Anne-Sophie Pic, as well as a modernized lobby area designed to be more sociable space. In the suites, modern upgrades include soundproofed windows, improved lighting and more accessible sockets. Designers Champalimaud, the firm behind iconic hotel revamps such as the Waldorf Astoria in New York and The Dorchester in London, said: "These modern installations have to be done discreetly without losing the essence of what was there." JLL's Rajan echoes this sentiment: "It's not just a Raffles it's the Raffles. Iconic hotels like this must strike the balance to maintain their heritage and, at the same time, stay relevant."Mandarin Oriental, LondonFor some hotels, renovation comes as a matter of necessity. Mandarin Oriental, Hyde Park, London, underwent a major refurbishment throughout 2016 and 2017 and reopened to positive press in summer 2018 only to be ravaged by fire one week later. The multi-million dollar renovation, hailed by the hotel group as "the most extensive restoration in its 115-year history" revamped the entire west wing of the 181-room hotel and introduced a new pool, spa and fitness centre. Following works to repair the fire damage, the hotel's flagship restaurant - Dinner by Heston Blumenthal - three bars and the spa reopened in early December 2018 in time for the festive season. Meanwhile, the guest rooms and suites will reopen in Spring 2019 once work is complete.Sandies Hotels & Resorts, MaldivesNew ownership is a common motivation for hotel makeovers and that's the case with the former Bathala Island Resort in the Maldives, which was taken over by Planhotel Hospitality Group in 2018. It will reopen under the Swiss hotel chain's Sandies Hotels & Resorts brand in February 2019. The property has undergone major rebuilding works to increase its room inventory from 46 beach villas to 49 beach bungalows and 24 water villas, as well as a new gym, games room and wellness centre. Famed for its snorkelling and diving, the resort will offer night snorkelling for a unique perspective of marine life.Britannia Hotel, Trondheim, NorwayBuilt in 1897, Norway's Britannia Hotel is due to enter a new phase in August 2019 when it reopens under hotel group Leading Hotels of the World (LHW) following a three-year, $150 million refurbishment. Located in the central Norwegian city of Trondheim, the hotel has welcomed politicians, royalty, international stars, and Arctic explorers during its more than 120-year history. It will become the fifth member of the LHW group in Scandinavia. Boasting six on-site restaurants and bars, handpicked furnishings and textiles, marble bathrooms and a ballroom, the 257-room property promises to meet the LHW's set of 800 quality standards.Okuro hotel, TokyoWhen Tokyo's 1960's icon, Hotel Okura, was partially demolished in 2015 ahead of renovations, it was met with public outcry and a petition to retain its old lobby. Happily, the operator agreed to restore much of the hotels original 1960s features, albeit across two new towers - Okura Prestige and Okura Heritage. Both are designed to withstand earthquakes and are due to open in early September 2019, just in time for the 2020 Olympics. The luxury hotel, which is next door to the US Embassy in Tokyo's Minato Ward, will reopen as the Okura Tokyo following the Y=110 billion ($979 million) renovation and, in addition to the 508 rooms it will house 18 stories of office space.One Aldwych, LondonTwenty years after it opened, One Aldwych in London's Covent Garden will close its doors in January 2019 for three months while its rooms and public spaces are updated. Housed in the former Morning Post newspaper building, the hotel is expected to reopen in March 2019 with all 150-rooms refreshed by British designer Robert Angell, who was behind projects including The Connaught and The Berkeley hotels. The renovation will also add four new suites to the hotel as well as upgraded, user-friendly technology throughout. The public spaces, including the lobby, the reception and the Indigo restaurant are due to be revamped by London-based Fabled Studio.Grand Hotel Quellenhof, SwitzerlandOne of Europe's leading health & wellbeing hotels, the Grand Hotel Quellenhof in Switzerland, will close in February 2019 for four months as it undergoes a $42 million renovation. The 106-room hotel is part of the wider Grand Resort Bad Ragaz, which includes the Grand Hotel Hof Ragaz, and is built around the local thermal waters from the nearby Tamina gorge. As well as offering guests spa and thermal bath treatments, the resort includes a medical centre for in-patient treatment and orthopedic rehabilitation, as well as the Swiss Olympic Medical Center. The work includes a new lobby and bar, refreshed rooms and new restaurant concepts and is scheduled to mark the resorts' 150th anniversary celebrations; it first opened its doors to guests in 1869.

U.S. Hotels - Who's Buying?

JLLH ·14 December 2018
As of YTD 2018, hotel transaction volume in the United States reached $29.7 billion, more than a 25 percent year-over-year increase, with private equity groups representing 37 percent of hotel acquisitions in the United States, or $11 billion.Hotel acquisitions have posted strong numbers and private equity has secured this year's lion's share. As of YTD 2018, hotel transaction volume in the United States reached $29.7 billion, more than a 25 percent year-over-year increase, with private equity groups representing 37 percent of hotel acquisitions in the United States, or $11 billion. This compares to 30 percent ($7.1 billion) for all of 2017.According to JLL Hotels & Hospitality, private equity groups have more pockets of capital than they've had in the past, allowing them to pursue a wider variety of investment strategies related to hospitality, ranging from core plus to opportunistic plays. Additionally, private equity hotel buyers are focusing on acquiring complex full service hotels and portfolios.While private equity may currently be the most dominant buyer, there are several other groups who are also demonstrating a strong appetite for hospitality product. Development companies have become more active in 2018, accounting for 13 percent ($4.0 billion) of YTD 2018 hotel acquisitions, compared to 10 percent for all of 2017. Additionally, offshore activity has observed a slight increase: YTD 2018 figures show offshore capital is equal to $4.0 billion of U.S. hotel acquisitions, compared to $3.6 billion over the same period in 2017.Factors contributing to the uptick in investment activity, particularly from private equity, include:A strong economy, including the lowest unemployment rate in half a century and third quarter annualized real GDP growth clocking in at 3.5 percent, above the economy's long-run potential of two percent growth.Continued leisure and corporate travel demand, with transient room night demand recording growth of nearly four percent as of August 2018 and group demand growing at 1.2 percent on a 12-month moving average basis.The hotel industry attracting more nontraditional and general real estate investors, in addition to traditional hotel investors.

Bright Young Chefs Add Sparkle To Hotels

JLLH · 3 December 2018
Hotels and fine dining have long been a near-perfect pairing but in todays food conscious culture, the addition of an acclaimed chef at the kitchen helm can really put it on the foodie trail.Its no longer just the small number of household names, like Gordon Ramsay who set up shop at Claridges for 12 years, who draw in foodie fans.In Europe, smaller, boutique hotels are leading the way, adding quirky, interesting and exciting chefs to the gastronomic mix, says Richard Moulds, director of Foodservice Consulting at JLL.Theres been a trend away from the white tablecloth celebrity chef, he says. Less well-known but highly capable chefs who have worked below bigger names are now offering hotel operators the chance to revamp their dining and perhaps at a comparatively lower cost.Hotels such as Londons The Curtain in Shoreditch have taken on chefs bringing a new freshness and creativity to dishes, with Marcus Samuelsson opening Red Rooster last year. Across town, Michelin-starred chef Tom Kerridge has been cooking for guests of the Corinthia since September.Theres an undoubtable culinary pull when an up-and-coming chef moves in, Moulds says. Offering a smaller menu and doing a few dishes really well is by no means purely in the hands of the celebrity.For diners, an element of discovery is also key, says Moulds: Its about creating something for foodies to hunt down and find, he says.Food good enough to shareSocial media and Instagram in particular has a big role to play in promoting high-end hotel dining. Short-term, pop-up residencies of one to two months for chefs are proving popular among Instagrammers, says Moulds.Theres a definite social media spike on offer for hotel restaurants capable of rotating chefs, he adds. Its not unlike the way galleries will rotate exhibitions or a nightclub will run a DJ residency.In the Maldives, luxury resort operator Soneva has used pop-up food residencies as a way to enhance its profile and provide guests with a memorable experience and perhaps even a reason to visit in the first place. Michelin-starred chef Kenji Gyoten appared at its flagship resort for a two-week post, while in Muscat, the Shangri-La Al Husn Resort & Spa hosted Danish chef and Noma co-founder Mads Refslund for four days in January.While a short-term residency may not be reason enough for someone to plan their holiday around, it can offer the cult, rock star effect and even raise interest from a chefs fans, says Moulds. For hotels in locations off-the-beaten track, the benefit for diners of being able to simply climb the stairs to bed after dinner cannot be underestimated.Some UK country home resorts have made the most of this benefit with diners becoming a captive audience.Playing the rating gameAs hotels note the benefits of offering stand-out food and drink spending on food and beverage at hotels rose by almost five percent in 2017 getting high quality chefs and providing a first-class experience are key.Reminders of a chefs background are typical, Moulds says, and central to dining decision-making.The archetypal food review will read along the lines of you may not know this chef, but he or she worked with this famous chef at this well-known restaurant its this association that brings in diners who are keen to be on-trend.The challenge for hotels, says Moulds, is when a chef packs up their saucepans something Berlins Regent Hotel experienced last year when Christian Lohse, the German capitals longest-serving two-star chef and a TV celebrity, left Fischers Fritz after 13 years. A change of concept by the hotel was swiftly announced.Concepts and tastes are in constant flux, says Moulds. But theres absolutely no doubting the appeal of a chef who can offer something special on the plate to complement a hotels surroundings.Appetite for an experience when dining is sturdy, Moulds says. In the case of Londons Mondrian hotel opening in 2014, award-winning U.S. chef Seamus Mullen worked closely with the establishments restaurant designers.Diners today want a fully-immersive experience, he says. Its about much more than just the off-chance that the chef swings by their table for a complimentary brandy and selfie.With competition for both high-spending diners and highly skilled chefs continuing to heat up, hotels know that good food doesnt just give them an edge, it can make them a must-visit destination.

How London's hotels are staying ahead of the curve

JLLH ·20 November 2018
As one of the world's most visited cities, London doesn't just need a plentiful supply of hotel rooms. It also needs them to meet the needs and expectations of an ever-widening group of business and leisure travelers.New designs, fresh twists on accommodation models and modern refurbishments are therefore essential to keep a market with occupancy levels of above 80 percent at the top of its game.London's hotels, says Graham Craggs, Hotels & Hospitality Managing Director at JLL, are changing how they use their interior space. And it's the lifestyle hotel concept that is leading the way, with brands such as Ace and Moxy and hotels such as the Ned responding to a growing need for more unique and authentic accommodation."It's about being able to accommodate the global nomad seeking more of an experience from their stay," says Craggs. "And the use of design, technology and space is at the heart of providing them with a comfortable and memorable stay."Revamping hotel interiorsAt ground floor level, London hotels are incorporating more co-working space for both their guests and non-residents. Upstairs, rooms are getting smaller. Take, for example, Hilton, whose lifestyle Motto brand is due to launch in 2020 in London's Marylebone district with a 100-room hotel."They're taking buildings and sites that in the past would not have suited their model," says Craggs. "The use of space is becoming more efficient."Converted historical buildings are proving particularly popular as a cost-effective option to create authentic spaces. The boutique Grade I listed Ned Hotel, for example, was previously the headquarters of Midland Bank and now boasts 252 rooms and nine restaurants. Meanwhile, the 160-room Art'otel at London's Battersea Power Station is expected to open in 2020 and the former U.S. Embassy in Mayfair building is set to become a 137-room hotel.The day-to-day operations of hotels are also changing. "Staff are more versatile and able to perform a range of tasks from check-in, to mixing a cocktail, or serving in a restaurant," he says. "Boundaries have blurred."Global appetitesGrowth from long-haul markets is shaking up London hotels. While the number of U.S. tourists rose in 2017 by 12.7 percent, visitor numbers from China have doubled between 2012 and 2017 according to the International Passenger Survey, putting the ability to speak Mandarin higher up the agenda for hotel staff recruiters.This year saw the first use of Chinese payment method Alipay in a luxury London hotel. With China set to become London's fastest growing tourism source in the coming decades, more hotels, regardless of price bracket, are likely to follow in the iconic Savoy Hotel's steps, says Craggs.Smaller touches are also important, such as providing Chinese TV channels and newspapers along with power adaptors. Meanwhile, more London hotels are adapting their breakfast menus to accommodate global tastes while using British ingredients. In London, food is a big differentiator, says Craggs."London hotels are not only competing with each other but with an incredibly strong restaurant scene and, particularly among lifestyle hotel guests, food delivery options," he says. "It's a challenge - but one which London hotels are taking on."Looking to the futureWith 11,600 more rooms coming on to the market by 2020, London's hotel market is continuing its expansion - and its growth is set to outpace other major European cities such as Paris, Berlin, Lisbon and Milan by 2020, according to the 2018 London Hotel Development Monitor report from JLL and London & Partners.Craggs says London's revenue per room, second only to Paris last year, is expected to grow in 2019 while a softer pound continues to pull in visitors from the eurozone and further afield."London's hotels will continue to be in high demand - especially among visitors from the likes of China and India," he concludes."There will be more openings in the coming months as more brands compete for affluent visitors - yet the most successful hotels will be those that best adapt to changing traveler tastes and preferences and meet their desire for experiences."Download Report

How wellness became big business in America

JLLH ·30 October 2018
During a '60 Minutes' segment on health in 1979, anchor Dan Rather said, "'Wellness': there's a word you don't hear every day."Four decades later, the word is ingrained into the paces of modern life, from a spirulina-infused smoothie in the morning, to an evening sound-healing session at the office, offered as part of a corporate wellness program."Wellness went from a niche concern - something 'granola' - to something that is mainstream," says Carl Muhlstein, who leads a landlord agency leasing team at JLL.With mass appeal comes mass profit. The wellness industry is now valued at US$4.2 trillion, having grown 12.8 percent in the last two years. It now represents 5.3 percent of global economic output.This has impacted real estate "in diverse sectors that range from retail to hotels and offices," Muhlstein says.Take, for example, gyms. From 2000 to 2016, the number of Americans who belonged to a fitness or health club nearly doubled to hit 57 million, according to industry statistics.As gym membership became commonplace, office landlords worked to secure boutique fitness concepts like SoulCycle or Orange THEORY, in addition to state-of-the-art gyms at their office developments. Muhlstein points to CFIT at C3 at Culver Pointe, a Gensler-designed creative office development in L.A.'s Silicon Beach, which features a complimentary 24-hour gym, which is used exclusively by tenants.With consumers driving the wellness push, "landlords need to consider how their wellness concepts stack up," Muhlstein says. "In the workplace, the focus on holistic healthy living and wellbeing - indoor/outdoor amenities, increased natural light, access to fitness areas -- also improves morale and productivity."What is wellness?Wellness encompasses anything that promotes physical, mental, spiritual or emotional health and happiness - or merely good feelings.Tonic bars are wellness. So are relaxed dress codes facilitated by athleisure boutiques. Acai bowls. Walk-in acupuncture clinics. Spin cycling and hot yoga studios. Activated charcoal lemonade. A makeup line formulated specifically to stay on during intense exercise - thereby aiding the ubiquitous gym selfie. All wellness.Millennials are in the driver's seat of its growth. More than 80 percent of people aged 18 to 34 are already spending a quarter of their disposable income on health products and services, according to JLL research."But it's not just millennials," Muhlstein says. "Now that we're four generations into the workplace, what baby boomer doesn't want access to a free state-of-the-art gym with high-tech treadmills and showers?"Wellness and real estateThe retail sector has really felt the wellness charge, both in terms of what goods and services companies offer, as well as what landlords consider when selecting retail tenants. Wellness-related tenants are now filling the prime retail spaces that might have belonged, pre-wellness-craze, to apparel retailers."There was a time when malls would prohibit fitness centers and gyms," says David Zoba, chairman of JLL's Global Retail Leasing Board. "Today, they are a welcome tenant. The attitude of shopping center owners has changed dramatically, even in the urban street environment. It's a trend that will never end. If anything, it's growing."Department stores have made efforts to up their wellness offerings. Saks Fifth Avenue dedicated one floor of its New York City flagship to health, fitness and beauty, and called it "The Wellery."For supermarkets, Whole Foods may have set the bar high, but now even big box stores, once associated with products with mass appeal and questionable health benefits, are increasingly offering cold brew coffee on tap, organic produce and fresh juice bars. Organic products are now available in nearly three out of fourconventional grocery stores, according to the United States Department of Agriculture's Economic Research Service.Hotels, too, have changed. Some Westin hotels offer a "SuperFoods" room service menu, incorporating broccoli and oats into dishes. At the Ritz-Carlton Georgetown in Washington D.C., guests can upgrade to one of 13 "Wellness Rooms," where they can enjoy aromatherapy bath salts, have a vitamin-C infused shower and breathe purified air. Forgot your gym clothes? In a partnership with New Balance, Westin now let's guests rent the brand's shoes, shorts, shirts and sports bras for $5.Apartments, homes and even neighborhoods dedicated to holistic health are also on the rise. There are more than 740 wellness estate and community developments either built or planned in 34 countries, according to the 2018 Global Wellness Economy Monitor. The $134.3 billion real estate niche within the wellness industry is projected to grow by 8 percent in the next five years, reaching over $197 billion by 2022.Wellness for allWellness retail is not without challenges. Many wellness offerings carry the stigma of being elitist, self-indulgent and only for the rich. Satirized on Saturday Night Live, Gwyneth Paltrow's e-commerce platform Goop has borne the brunt of this mass disdain in all three categories. Her site sells a prettily-packaged, $27 "Psychic Vampire Repellent Protection Mist," designed to "clear toxic energy, promote calm and creativity" by using "sonically tuned stones."In order for the industry to reach its full potential, consumers have to see wellness as a way of life that is accessible to everyone, not just the elite, Zoba says. He predicts that more relatable and inclusive wellness concepts will come forward in coming years.As it becomes more accessible, it will also be more palatable to geographies outside of the East and West coasts, which are currently home to the bulk of the industry, according to Zoba."You're not going to get the $180 a month gyms in the central part of the U.S.," he says. "The trend has room to run before it reaches its peak on a national level."

Why more consolidation is on the cards for hotels

JLLH · 8 October 2018
From mega-mergers to niche acquisitions, consolidation is recalibrating the balance of power in the hotel industry as established operators get bigger and smaller brands seek new ways to differentiate themselves.Today's hotel operators are increasingly looking to diversify their offerings with a range of different concepts, for example serviced apartments or boutique chains alongside their established brands, as well as branching out into new countries.New live-work-play concepts are emerging as "a kick against the idea of the traditional hotel", Tony Ryan, managing director of global mergers & acquisitions at JLL says, pointing to The Student Hotel's offering of accommodation, workspace and student housing.Others are following a more well-trodden path: In 2017, French giant Accor bought Australia-based Mantra to increase its market share in Asia Pacific. In June, Thai group Minor International made a move to boost its European presence with plans to acquire NH Hotel Group for around EUR2.5 billion ($2.9 billion)."Acquisitions will continue - but become more targeted. M&A at the top means smaller management companies are spurring the growth of different, sometimes hybrid hospitality offerings," Ryan says. "That's where the interest among millennials seems to be; some larger operating groups may look to get involved in that. But you need a unique DNA to accomplish that edgy, local feel."Adding missing conceptsFor some operators, any slight overlapping of hotel concepts is a price worth paying if there is a major geographical advantage to be had elsewhere in the newly-merged entity."An operator may find they 'double-up' in one country, but that can be tolerated if the merger brings new sought-after territories into play," says Sally Kendall, executive vice president of JLL Hotels & Hospitality.In central Paris, for example, Starwood's Prince de Galles is south of the Champs Elysees while the Paris Marriott is to the north. They're both now part of the same family after their 2016 global merger, arguably vying for the same clientele. While the intricacies of the merger continue to be ironed out, "overlap" of hotel concepts is a rarity."The mergers that have taken place in recent years have complimented rather than duplicated; the jigsaw has fitted together well," says Kendall.Wyndham Worldwide's US$1.9 billion deal to take 900 franchised hotels off La Quinta helped it to expand its reach into the economy and midscale segment. InterContinental Hotels Group recently completed its acquisition of 51 percent of Regent Hotels & Resorts in another move for luxury growth.Stronger negotiating handsFor the likes of AccorHotels, which recently added Movenpick Hotels & Resorts, Atton Hoteles, the Mantis Group and SBE Entertainment Group to its roster, more brands is about more than just a greater market share."The advantages are immediate, boosting negotiating power with major travel agencies and broadening their customer reach through loyalty programs," says Kendall.And despite the recent spate of consolidation, top brands still only account for around a third of all hotel rooms around the world, leaving plenty of room for more activity to meet investor expectations.The growing appeal of the hotel sector among investors has put pressure on operators to deliver strong growth, adds Ryan. "Aggressive - rather than organic - growth is mandatory if the higher returns that are now expected of the hotel sector are to be achieved."For the hotel industry, it means smaller deals will continue apace while some mega-deals could reshape the sector further."We expect to see more M&A activity in the future as the industry is still relatively fragmented compared to other sectors, creating more opportunities for consolidation," Ryan concludes."While there are a couple of so-called mega-deals in the pipeline, the drive to add brands or geographies will continue as traditional operators, as well as private equity owners of hotel groups, seek ways to improve earnings or fill in the missing gaps in their portfolios."

Hotel investment strategies in Sub-Saharan Africa evolve, as hotel trading gradually improves - JLL Reports

JLLH · 4 October 2018
The report confirms expectations for hotel trading to remain under pressure during the balance of 2018 and in 2019, as new rooms continue to be absorbed into the market. Nijnens said that despite a muted trading environment in many markets, there is evidence that well placed, distributed, branded, and developed products can consistently outperform the market. "New segments such as serviced apartments and branded economy hotels hold strong returns prospects," he said. "For investors looking at the market, the wide spectrum of market prospects and asset performance brings both opportunities and challenges."JLL forecasts annual investment into hotel development of US$1.7 billion in 2019, with investment sales in 2018 of US$350 million and increasing to US$400 million in 2019. Nijnens adds "We expect liquidity and trading of hotel assets to continue and this will improve pricing transparency in the market and reduce ownership risk. Value add strategies will be the most successful approach to acquisitions as there is a lack of well-priced quality assets available for trade." Development returns are highest when focused on disrupting the sector or when addressing emerging demand and differentiating projects. Brand conversions present strong revenue upside prospects and they are well supported by the international brands in the current climate.The report also looks at lending on hotel developments in Sub-Saharan Africa, identifying that banks have continued to be prudent in their lending and conservative in their leveraging. "They are however becoming increasingly savvy, with more of a dedicated focus towards the asset class," says Nijnens, "and are showing positive intent to get to grips with the sector. As lenders become increasingly knowledgeable, it will result in the most feasible projects receiving funding". Another trend is the number of new lenders entering the sector through their existing relationships with diverse real estate players, which is deepening the lender pool. With a clear market opportunity, Nijnens says the next few years will be interesting to watch to see whether alternative and mezzanine lenders will enter the sector.Regional markets are increasingly diverse and out of sync, and the prospects and risks across the region vary immensely. In 2018, hotel performance has been mixed across the region, largely due to the impact of new supply entering the markets, as well as external demand pressures. West Africa has seen the most improvement in performance with commodity pricing on the up and many economies thriving. East Africa has experienced good demand growth, yet occupancy has been under pressure due to recent supply growth. Performance in Southern Africa is stagnant as a result of the economic slowdown in South Africa, as well as the impact of the drought in Cape Town. Indian Ocean performance continues to be very strong with an excellent outlook.From a macro-economic perspective, the Sub-Saharan regions continue to make progress and are increasingly featured on investors' radars. This, despite global sentiment impacted by slower growth, high oil prices and fears surrounding the unwinding of the US Federal Reserve's balance sheet. Tom Mundy, Head of Research, JLL Sub-Saharan Africa, pointed out that "good quality assets, in sound locations with reliable income streams, remain attractive to investors. Improving transparency on the continent, while gradual, will underpin the investment case for real estate in Africa."The outlook for hotel investment in Sub-Saharan Africa in the medium and long term is positive. Developing cities with high supply growth were always going to place pressure on performance and this is now being felt. Nijnens concludes that "this pressure is resulting in an evolution of investment strategies to the region, and those who read the markets well, create relevant product, and innovate in their approach to the sector will reap the reward."Notes to Editors The report, An overview of Hotel Real Estate in Sub-Saharan Africa 2018, will be launched at the Africa Hotel Investment Forum (AHIF) taking place in Nairobi, Kenya from 2-4 October 2018. Following five years of high supply growth, the hotel sector in Sub-Saharan Africa is going through a new room absorption, while investors are broadening their focus on the region. JLL's report delves into the implications to the sector and the reasons it remains an exciting region to trade in. The study reflects the results of JLL's survey with key investors and lenders who are actively targeting hospitality real estate in Africa. The perspective of both lenders and investors alike looks to bridge the views of these two players and present a more holistic view of the sector. The full report is available for download here.

How African luxury tourism is heading off the beaten track

JLLH ·25 September 2018
Africa has long been a favorite destination for safaris and hot air balloon flights over migrating herds but now the hospitality and tourism industries are exploring new locations to cater for luxury traveler's increasing appetite for adventure."African tourism has evolved significantly in the last decade with a new wave of young, affluent travelers, as well as the so-called baby-boom generation, fueling demand for high-end experiential travel," explains Xander Nijnens, head of Sub-Saharan Africa Hotels and Hospitality at JLL.People want authenticity but they also want novelty. And when it comes to luxury travel, there's also the exclusivity factor."People are willing to travel deeper and further beyond more frequented destinations such as the Maasai Mara," Nijnens says. "That has in turn meant that areas that have been less developed are now coming into focus. Hotel operators are changing their game."While established hotels with sweeping views of the surrounding landscape and watering holes continue to attract steady flows of guests, more nomadic options such as luxury camping and integrated lodges are becoming increasingly popular."There's certainly been a move away from traditional bricks," says Nijnens. "Guests still want many creature comforts like comfortable bedding, fine dining and hot showers but they want them in a different type of setting that makes for a unique and memorable trip."And of course, the natural wilderness and eye-catching designs of many new developments lend themselves well to social media."Sharing experiences online has brought a new element to African travel," Nijnens says. "And that's helping to promote the continent's lesser-known locations meaning large tourism marketing budgets are not needed."Making the most of natureCountries across Africa are playing to their strengths in what they offer luxury travelers. In Rwanda, that is gorillas, and with the price of a trekking permit to visit them in their natural habitat doubling to US$1,500, the country is targeting lower numbers of high-spending guests - an approach also taken by established luxury destination Botswana."Unlike South Africa or Kenya which have several big tourism draws dotted around the country, Rwanda needs to make the most of its main attraction," says Nijnens.And where high-spending tourists in search of the natural touch go, luxury hotels are not far behind. In Botswana, camping tents with luxury bathrooms in a "semi desert" setting have been created by the owners of Jack's Camp. In Rwanda, for example, Bisate Lodge in Rwanda, which opened in 2017 and is built into a volcanowith exterior walls made from woven natural materials.The use of raw materials such as wood and clay is not just aesthetic, with environmental impact also a factor. Some countries are moving towards hotel concepts which minimize the effect on the very landscape many tourists are there to visit. In the Seychelles, which was visited by almost 350,000 people in 2017, a 15 percent rise on 2016, a major tree-planting effort is underway and a moratorium was last year put on construction of new hotels across the archipelago.South Africa's non-profit Grootbos Foundation,which runs a range of luxury accommodation, has worked with - rather than against - the environment by planting trees, while also educating locals through its college and tuition schemes."Proximity to nature is one thing, but tourists also want to feel they are getting close to the people of the country they visit," says Nijnens. "Getting closer to nature also means getting closer to the way people live."Room for more high-end hotelsThat does not mean more classic hotel concepts are completely left behind, however. In gateway cities, hotel chains and independent operators are also benefiting from travelers looking for high-quality accommodation.In Kigali, Radisson Blu launched a new 292-room luxury complex in 2016, with the Marriott group also opening in the Rwandan capital in 2017, its first in sub-Saharan Africa. Demand for city stays is being met by major global operators, as well as smaller boutique concepts, such as the Silo Hotel in Cape Town, Saxon Hotel in Johannesburg, and Hemingways in Nairobi."People will always need somewhere to stay when they arrive or before they fly out of one of the big cities," says Nijnens. "The global chains are strong in gateway cities due to the business nature of the market, yet they also cater to leisure visitors to African capitals. What's really changed is the more diverse type of vacation being taken in-between that first and last night."And with the global luxury travel industry set to generate more than $1.1 trillion by 2022 according to Allied Market Research, competition for high-spending guests is only going to increase. For all those involved in the luxury tourism industry in Africa, the pressure is on to offer new and exclusive experiences while having a positive impact on both nature and their surrounding communities."It's an exciting time for experiential travel in Africa," concludes Nijnens. "Done well, it offers lifelong memories for guests and long-term, sustainable benefits for local economies across the region."

How serviced apartments are tuning into modern traveler needs

JLLH · 7 September 2018
As the line between work and leisure trips continues to blur, serviced apartment operators are both fuelling and catering for this growing 'b-leisure' market.More than two thirds of business travelers tag on extra days before or after meetings on at least one trip a year, according to Egencia. Combine it with changing traveler preferences for home-style accommodation in convenient locations, and serviced apartments are an increasingly popular choice."Many of today's travellers want to stay somewhere where they tend to have more space and greater independence than in traditional hotels," says Eva Chan, vice president of JLL Hotels and Hospitality EMEA research. "That's also being met by a greater number of people who want to mix business with leisure, whether that's bringing a partner along for the leisure portion or spending the weekend sight-seeing in a new city."It's something that accommodation operators are aware of. New lifestyle brands such as Zoku, Locke by SACO, Wilde Aparthotels by Staycity, Adina and Bridgestreet's Studyo are providing comfortable, high-quality apartments while big name hotel groups such as Adagio, Novotel, Hyatt and Marriott are also adding their own offerings to the mix.As a result, it's creating the fastest growing sector within the hospitality industry, with more than one million serviced apartments globally in operation at the end of last year, according to research by JLL.Changing needsWhile serviced apartment guests are looking for a different type of accommodation experience to that of a traditional hotel, they're still looking for the human touch, albeit at a time of increased technology."This is not just keys in a lockbox," says Chan. "Having a point of contact is still an important element of the serviced apartment concept. Check-in, for example, does not necessarily require the personal touch. But that's not to say that guests do not value service or interaction - far from it."For serviced apartment operators, the need for less staff - given the absence of a breakfast kitchen area and accompanying staff for example - may prove to be a step in the right direction of efficiency, as well as changing the use of ground-floor space."Lobby areas are evolving into more communal areas where guests can interact and socialise," says Chan.Safety, meanwhile, is an area where serviced apartments have an advantage over the home rental market, where there's no consistency between properties listed on the sites and quality levels are harder to gauge. Any issues are also more easily addressed, for example, by having an apartment manager available and back-up service in the case of a plumbing or electrical fault."If you're offering a better, certified product, then companies will feel more relaxed about their staff staying in a serviced apartment," says Chan. "That's a clear differentiator from the private short-stay apartment product offered directly by an often-absent landlord."A growing marketServiced apartments brands are expanding rapidly in Europe, says Chan, who points to "new names" such as Canadian investor Brookfield's SACO in Europe, Adina in Germany - part of Australia's TFE Hotels - and Dublin-headquartered StayCity, which in May announced plans to expand into Germany. The firm has 4,500 apartments either in the pipeline or already in operation in 10 European cities, and is aiming for 15,000 apartments by 2022.The UK accounts for a large part of the growing market. Regional cities, such as Edinburgh, Manchester and Liverpool, are seeing more apartments, up 23 percent over 2017. But the sector is largely still in its early years."The sector is still quite fragmented and run independently," she says. "You could argue that more branding is needed if these operators are to reach a bigger audience. A brand is almost like a service guarantee, boosting familiarity among guests."Around half of Europe's serviced apartments are branded, according to JLL's report, yet there's room for more with the serviced apartment sector set to grow at a faster pace than hotels over the next few years amid rising traveler demand."Hotels need to diversify more and see the benefit of serviced apartments which drive a much higher margin than traditional hotels," says Chan. "The demand is there from today's travelers - now it's up to investors and operators to provide more quality supply."Download Report

How hotels are upping their game on food and drink

JLLH · 4 September 2018
From partnering with world-renowned chefs to letting guests order room service via Amazon Alexa, hotels are increasingly offering innovative food and beverage (F&B) experiences.F&B is an important revenue generator for hotels, with overall consumer spending in the U.S. alone rising by 5.5 percent annually since 2011, according to Technomic. The biggest driver of F&B, however, is a desire among hotels to tap into today's experience-led economy."Having a memorable experience is especially important among today's young people," says Alexis Marcoux-Varvatsoulis, Consultant - Hotels F&B Specialist at JLL. "Instead of simply having a room to sleep in, Millennials are looking for innovative concepts that enhance their overall experience. In return, F&B provides hotels with more chances to interact with guests, thereby reinforcing their image, and when done well, generating positive reviews on social media to reach new potential guests."Competition among hotels and restaurants is stiff, which means it is no longer enough for hotels to simply add on an eatery as an afterthought. Standing out from the crowd is incredibly important - and this has led to some innovative concepts being introduced.Food a feature of hotel lobbiesHotel lobbies are becoming much more than a simple reception and gift shop with coffee bars, grab and go stations for snacks and comfy seating that encourages people to linger. In Marriott's Moxy hotels, the focus of the lobby is on eating, drinking and socialising from the self-service buffet at breakfast, fully-stocked food wall and coffee and full-service bars.The big focus of a lobby needs to be on the food & beverage experiences," George Fleck, VP of global brand management and marketing for Westin, Renaissance and Le Meridien, tells Hotel Management. "The first thing you should see when you walk in, ideally, is a really beautiful bar scene. The seating has been arranged to ensure there are communal seating opportunities and that there are intimate seating zones for more personal conversations."Other novel concepts include homemade snacks and pastry-making demonstrations in the lobby of the Renaissance Tuscany II Ciocco Resort & Spa, and a ceviche and tequila bar in the lobby of Marriott Puerto Vallarta Resort & Spa in Mexico.Flying in world-renowned namesTo bring guests and locals a high-profile foodie experience, some hotels are 'flying in' Michelin-starred restaurants from the other side of the world. The Crown Hotel in Melbourne was home to the UK's famous Fat Duck restaurant for six months, while the Mandarin Oriental in Tokyo provided a six-week residency to Copenhagen's Noma. The latter had a waiting list of 65,000 guests."This type of arrangement is a win-win for both parties," says Marcoux-Varvatsoulis. "It offers the restaurant an opportunity to test its brand in a new city, and for the hotel it is a great way to market its rooms to a large pool of potential guests."Room service via AINew technology is increasingly on hand to satisfy guests' needs - and appetites. At the Lowry Hotel in Manchester, guests can now order room service via Amazon's virtual assistant Alexa. And in the U.S., residents at Choice Hotels International can get external food delivered via a mobile app, created through a partnership with"Using technology not only demonstrates that the hotel is on trend, but it also makes it easier for guests to spend money. The long term benefit is convenience for guests," explains Marcoux-Varvatsoulis.In-room cooking programsThe concept of in-room grocery deliveries has been taken a step further in the Hawthorn Suites by Wyndham, which has launched an in-room cooking program. Aimed at long-term travelers, the recipes have been devised by famous chefs such as Hari Nayak and James Rigato.Attaching a breweryA rise in the popularity of craft beer and spirits has led some hotels to incorporate on-site breweries. The Source Hotel in Denver has a branch of New Belgium Brewing next to its lobby, while Cavalier Hotel in Virgina Beach includes a bourbon, rye and vodka distillery. BrewDog, the Scottish brewery, recently announced it was planning to open a second DogHouse hotel in Ellon, complete with in-room beer taps, after launching the concept in Ohio last year.F&B pop-upsSome hotels have turned to pop-ups as a way of letting guests try the latest food and drink trends. Marriott International launched an F&B incubator project, Canvas, in 2014 which is designed to maximize space in its European hotels. The rooftop at Marriott's Park Lane hotel has been host to the likes of Notch, offering Japanese street food and homemade cocktails in cans.Whether it's via technology, pop-ups or famous chefs, the focus on F&B is expected to rise over the next few years as hotels seek to tap into the demand for exciting new concepts. "In today's competitive marketplace, where online reviews are the major driver of choice, it's essential for hotels to create a positive buzz," says Marcoux-Varvatsoulis. "It's an exciting time for hotels and food-savvy travelers alike."

Why Asia leads the race in smart hotel technology

JLLH ·30 August 2018
Robots butlers, keyless entry and virtual reality-enhanced room bookings: Hotel guests are increasingly being greeted by these once futuristic tech features around the world. But hotels in Asia have been upping the ante, with a younger hospitality industry - and many guests in their 20s and 30s - quickly taking to new innovations.In Japan, for instance, self-parking slippers and furniture are able to return to their designated spots after use. A blockchain reward system introduced by Malaysian hospitality firm Hatten Group allows members to collect tokens in exchange for hotel packages and stays. Meanwhile, Andaz Singapore and Hotel New Otani in Tokyo have introduced chatbots for guests as a handy way of providing recommendations and answer any queries."In some respects, it is easier to trial and grow these concepts within Asia as new-build hotels can incorporate these products and concepts into the design at a very early stage," says Andrew Langston, Executive Vice President, JLL Hotels and Hospitality Asia Pacific. "Moreover, Millennials grew up with technology and they're very comfortable with adopting new innovations."Opportunities and expectationsAsian tech companies are quick to recognise the opportunities in the hospitality industry. Alibaba has developed facial recognition check-in for two Marriott hotels in China, which could be rolled out globally after trials. Hong Kong-based Tink Labs' createdHandy Japan, a concierge-service smartphone that is being used in around 80 countries; Softbank has recently jumped on board to support the initiate as Tokyo prepares for a tourist boom in anticipation of the Olympic Games in 2020.It's not just tech companies trying to inject their products. Hotel chains are hungry for more innovation to speed up efficiency and improve customer experience. Langston points out that technology is helping the service industry to meet its resourcing requirements.South Asia's largest hotel chain Oyo acquired an Internet of Things firm, AblePlus, to use its technology and Artificial Intelligence in better managing its hotels and assets. Meanwhile chatbots on hotel sites are helping to overcome difficulties in finding service staff willing to do repetitive tasks and greater restrictions on foreign labour.Efficiency aside, hotels also turn to technology as a way of managing costs in a capital intensive industry, especially for the budget mid-scale segments where room rates are more competitive."Ultimately technology is increasingly expected in hotels rather than being a nice-to-have feature nowadays, especially for the travellers in Asia and from Asia. If hotel companies do not adapt, they will be left behind," Langston says.Evolving with changeAs technology becomes a core - and critical - part of hotels, the industry is planning ahead. Progressive Asian cities like Singapore have unveiled a Smart Technology Hotel Road Map to help the industry advance. "It makes sense for governments to support and drive such initiatives. I think we will see similar trends from growing technology hubs in countries such as India and China," says Langston."These are great initiatives. Taking a proactive approach will be the only way to remain abreast with technological advancements. This could similarly accelerate the speed of adoption of technology within the hospitality industry in developing countries such as Vietnam, Philippines, Cambodia, and Myanmar where the governments see tourism as an excellent vehicle to grow revenues."However, heaping new tech into a hotel business isn't a guaranteed path to greater success. Langston cautions against hotel brands and operators rushing headlong into technology. It would serve them better to define their identity and branding - whether are they "high touch, low tech or high-tech, low-touch" and learn to tread a fine line as they determine who the hotel and its technology - or lack of - are catering for, he advises.

How America's motels became hipster havens

JLLH ·30 August 2018
In the heart of Palm Springs, a once nondescript Howard Johnson motel with an on-site Denny's restaurant is now the Ace Hotel & Swim Club, replete with outdoor fireplaces, live music by the pool, a vintage photo booth and Middle East-meets-California fusion dining.The Drifter, once a rundown, dodgy edifice in New Orleans, now offers specialty coffees from La Colombe and poolside craft cocktails for guests staying in minimalist-style rooms.The Vagabond in Miami, a former dive motel built in 1953, today has rooms with hypo-allergenic Italian bedspreads and stenciled geometric wall art.Across the United States, hoteliers and developers with an eye for a great location and an affinity for Americana are buying fifties and sixties-era motels and giving them top-to-toe revamps, while making sure they retain the retro aesthetic that attracts style-savvy travelers. The trend has picked up so much steam that it has transformed the very notion of a motel - from one of a pit stop to one of a destination."These projects have removed the stigma of the motel experience," says Geraldine Guichardo, VP of Americas Hotels Research at JLL. "There is no longer the assumption that all motels are degraded properties you pass on the road. The idea around the motel is now enhanced."A formula for successThe motel -- a word which fuses "motor" and "hotel" -- used to be the no-frills mainstay of the weary and budget-conscious road-tripper. As modern hotel brands have reclaimed these uniform spaces, a fairly universal approach has emerged. Designers tend to keep the overall architecture and trademarks of the building intact - as well as the exterior corridors, motor courts and small swimming pools. They often throw in a neon sign or two, so the establishment screams "hip vintage."But successful moteliers also include the necessary upgrades demanded by the traveler, Millennial or otherwise, who likes the idea of staying somewhere unique but doesn't want to sacrifice comforts like high-thread-count sheets and fair-trade coffee.In Napa Valley, for example, the Calistoga Motor Lodge -- formerly the Sunburst Motel -- fits right in with the aspirational vibe of the area, which is known for its Michelin-starred eateries and bountiful vineyards. Its grounds include three soaking pools, filled with water from local geothermal springs. The amenities range from a mix-your-own mud bar in the spa and pour-over Equator coffee in the rooms."In a market like Napa, a place like the Calistoga Motor Lodge makes sense," says Guichardo. "A motor lodge with a spa that complements the vineyards and the wine experience -- travelers want that quaint, simple, retro experience."Placemaking potentialLocation is key to the success of any revamp. "When you have a market that is undergoing a real estate transformation, motel developers have the opportunity to be part of the market's evolution and can benefit from the anticipated additional demand the market will observe," Guichardo says.The Vagabond Hotel in Miami, for example, sits on Biscayne Boulevard (which runs off from historic Route One), a stretch known for its craft breweries and art galleries. As a consequence, the Vagabond draws in design-savvy travelers.For hoteliers considering a substantial makeover of an existing motel property, seeing thriving adjacent properties, both residential and commercial, "offers some level of assurance," Guichardo says."If they see new restaurants coming in and multifamily complexes going up, with residents who have guests from out-of-town who can stay at the local motel, it makes sense for a hotelier to follow suit and create a new lodging product that's in line with the cool feel of the neighborhood," she says.But it can also go the other way. Some hoteliers take these renovations to the next level by simultaneously sprucing up retail or restaurant properties in the immediately adjacent area, creating, in effect, a hip district.More money, more problemsDespite the success seen by a number of these new motels, Guichardo says that, like every incipient trend, this one has its challenges. In order to reap the desired profit from their makeovers, many hoteliers need to charge rates that are double or even quadruple the rates of the original motel. Certainly, if a motel's prices rise from $69 a night to $169 to pay for all the sophisticated touches, some travelers may elect to stay at a recognized hotel brand instead, a place where they know what to expect.Investors entering the space need to be sure there is enough demand from cash-rich, minimalist travelers. Market research is key to understanding what visitors to an area value, Guichardo says.Developers should also be cautious of focusing too squarely on Millennials, Guichardo says. While they "make up a considerable proportion of the lodging demand and are known for prioritizing experiences," Millennials too are pairing off and having families. This may lead many to seek a more conventional hospitality experience.While there are clear hurdles to a successful revamp, it's clear the mass perception of a motel stay has changed, and more roadside eyesores will likely go the way of the Ace."They're no longer a place where you pull up blindly after a night of driving," says Guichardo. "Motels are a place you may want to consider far ahead of time, while planning a vacation. Some are so popular, there's a waiting list."

OK, Computer: Why hotels are employing digital concierges

JLLH ·27 July 2018
As the technology driving AI and recommendation engines continues to evolve, hotels are starting to embrace the power of digital concierges to provide a customized and on-demand service.In June 2018, Amazon announced Alexa for Hospitality, an in-room version of its voice-activated virtual assistant designed especially for the hotel industry. As part of the launch, Marriott International is set to introduce the experience at a number of properties in their brand portfolio, including Marriott, Westin, St. Regis, Aloft, and the Autograph Collection.Marriott will also trial smart mirrors in one of its Autograph properties in Texas. The full-length mirror doubles as an interactive touchscreen and TV that provides guests access to room controls along with digital concierge services. Moreover, guests are increasingly able to engage with branded chatbots as part of their end-to-end hotel experience.A burgeoning marketThird-party companies are helping expand this niche marketplace by offering hotel brands the ability to outsource their digital concierge services. When in Roam, for example, crafts curated travel experiences and has partnered with Hotel Chicago to offer the service to guests. Porter24 assists guests via large interactive touchscreens and sends relevant destination details to their phone."The trend matches how people process and access information today, which is increasingly by smartphone," says Geraldine Guichardo, Vice President of JLL Americas Hotels Research. And as voice-activated assistants become commonplace, people are growing more comfortable with screenless interaction that mimics human conversation.For guests, access to a digital concierge offers instant, up-to-the-minute information that would otherwise be difficult to discover, such as if a restaurant is closed for a private event, or a festival is cancelled due to rain. "It also frees up hotel staff to focus on aspects of the guest experience that require a human touch," says Guichardo.As digital concierges become a more established feature, regular visitors to a particular hotel or brand can receive an increasingly personalized service. In the digital sphere, data can be gathered, stored and analyzed to create recommendations that better reflect a guest's preferences and behavior, as the system learns and improves. "It takes much more effort for human concierges to offer this level of customization," says Guichardo.Knowing the audienceDespite the advantages, digital concierges do not suit every type of hotel. "Guests of luxury, five-star hotels expect intuitive human interaction as standard," says Guichardo. Outsourcing such services to a digital concierge risks ruining the guest experience and harming the brand.According to Guichardo, digital concierges make most sense for new or up-and-coming brands like Marriott's Moxy or Tru by Hilton, which target the Millennial market, as well as independent hotels trying to build a reputation as cutting-edge. "Rather than assume everyone wants a digital concierge, it's essential to ask whether this type of service resonates with the specific target market," she says.In terms of challenges, privacy remains a key concern. "To get that personalized experience, you do have to give up a significant amount of data," says Guichardo. A transparent and accessible privacy policy, however, can help assuage user anxiety and build trust.Another risk inherent in current Internet of Things technology is security. Hotels need to ensure their devices and software are secure to avoid hacking and potential data breaches.On account of these challenges, along with the high cost of today's technology, Guichardo believes the trend will develop relatively slowly."It's an investment, and owners have to consider the benefits and returns of digital concierge versus, for example, renovating a common space," she concludes. "If Amazon's partnership with Marriott is successful, however, it could prove a catalyst for mass adoption in relevant brands across the industry."

JLL China12: China's Cities Go Global

JLLH ·27 July 2018
This report for real estate investors examines how China's cities are shaping our future. The Chinese government's ambitious Belt and Road Initiative is transforming skylines, building new connections and redrawing city networks. This increased investment in the region is fuelling land sales, development, investment and leasing activity.Find out why cities across Asia Pacific are key targets for investment:Singapore has the strongest connections with China globally, ranking as the leading expansion point for China's globalising corporates.Sydney and Melbourne have attracted significant real estate investment from Chinese buyers, as Australia's cities become major hotspots for Chinese tourists, students and real estate developers.High-growth markets in South and Southeast Asia - including Jakarta, Bangkok, Kuala Lumpur and Delhi - are becoming key battlegrounds for multinational technology giants, with Chinese firms forming a key part of this competition.Find out which cities in Asia Pacific are the key targets for Chinese corporate expansion, development activity and real estate investment, what impact will China's Belt and Road Initiative have on the region's real estate market dynamics and emerging city futures?Download the full report

Transformational Real Estate Development Across New York Has a Major Influence on Lodging

JLLH ·29 June 2018
New York is a hot spot of major transformational real estate development that is rapidly changing the city's landscape and lodging environment, according to JLL's 2018 New York Hotel Market Report.Hudson Yards, situated in the Midtown West submarket, currently represents the largest private real estate development in the history of the United States and the largest development in New York since the Rockefeller Center. The Manhattan West District and Moynihan Station developments will also grace the Midtown West submarket and are targeted for delivery by 2022.Transformative redevelopments are also occurring in Midtown East and Downtown, all of which will elevate each respective neighborhood's profile. One Vanderbilt is underway in the Midtown East submarket--a 1.7 million gross square foot office skyscraper that will stand next to Grand Central Terminal. When complete, One Vanderbilt will represent the second tallest building in the city.Lower Manhattan is also being rejuvenated and with the expected delivery of 3 World Trade Center by year-end. The World Trade Center hub and memorial have recently been activated and millions of square feet of retail have been added, including Pier 17, a quaint boardwalk in the area.This unprecedented surge creates a dynamic where submarkets previously concerned with increasing hotel room supply may become under-supplied in the next five years. This is because the level of existing and anticipated Class A office space in the market will support rapid hotel room absorption. RevPAR performance to date suggests that new supply additions are slowing and being absorbed. Therefore, we expect RevPAR growth to become more pronounced in 2019 and 2020, as fewer rooms are anticipated for delivery over these two years than are projected to be delivered in 2018 alone.Opportunity to improve marginsIn an analysis of 90 P&L statements of New York City hotels from 2013 to 2017 by JLL, the data suggests that gross operating profit (GOP) performance bottomed in 2016. Performance in 2017 started trending upward and performance in 2018 is off to a promising start, driven by YTD May 2018 demand growth of 6.0 percent."Over the analyzed period, we noted that GOP is more sensitive to changes in RevPAR than supply. On average, when RevPAR shifts one percentage point (negative or positive direction), GOP will shift a corresponding three percentage points," said Gilda Perez-Alvarado, Managing Director, JLL. "As such, with sustained improvement in demand fundamentals and muted supply growth, the market will gain more rate integrity, resulting in positive RevPAR growth and stabilized margins at year-end."New York transaction volume to reach robust levels supported by acquisitions from private equity and New York centric owners/developersWith YTD June hotel sales of $2.3 billion, New York's hotel transaction volume is nearly five times the volume achieved during the same period in 2017. The drivers behind the exceptional level are the sale of Edition Times Square for $1.53 billion (inclusive of retail and signage) and the disposition of W Hotel New York for $190 million.Since 2017, capital in the market has primarily originated from domestic private equity and New York centric owners/development companies, accounting for 81.0 percent of acquisitions. However, over the past five years, foreign investors have acquired nearly $10 billion in New York hotels. As such, we expect cross-border investment to pick up throughout the remainder of the year as the product quality brought to market continues to improve.Opportune time to invest in New York hotelsReviewing the data on a per-room basis, hotel transaction values peaked in 2015. Today, the twelve-month moving average price per room is at approximately 80 percent of the level seen in early 2015, indicating that right now, hotels in New York are transacting at multi-year lows.Hot debt marketsThe hospitality debt markets are performing well and notwithstanding New York's elevated supply pipeline, lenders such as commercial banks, insurance companies, debt funds and CMBS, remain interested in financing New York hotels.Further, indicators suggest that the current economic expansion is only accelerating as the effects of the recently passed tax legislation have yet to be felt. This dynamic bodes well for the debt markets and as such, in the second half of 2018 we anticipate additional spread compression, greater liquidity available in the market, and more aggressive underwriting and loan structures.New York: a coveted hotel investment destinationNew York is one of the most coveted hotel investment destinations. Its unwavering economic strength and tourism appeal will help the market overcome current supply challenges, allowing the market to experience meaningful growth in the near future.From 2012 to YTD June 2018, New York has recorded $17.6 billion worth of single-asset sales, placing it ahead of other major gateway markets such as London ($12.9 billion), Paris ($5.8 billion) and Hong Kong ($3.1 billion) for the same period.For more insights on how New York's transformational real estate developments are impacting the lodging sector, download JLL's 2018 New York Hotel Market Report.JLL's Hotels & Hospitality Group has completed more transactions than any other hotels and hospitality real estate advisor over the last five years globally, totaling more than $77.5 billion worldwide. Between negotiating property deals, the group's 350-person global team also closed more than 5,300 advisory, valuation and asset management assignments. To find out more visit:

How Blockchain is taking hold across Asia Pacific - JLL Real Views

JLLH ·30 April 2018
Start-ups across Asia Pacific are increasingly testing the potential of Blockchain, a disruptive technology impacting industries from healthcare to real estate.Singapore's Suntec City building is setting itself up as a hub of blockchain players with several companies setting up shop in a 1,336sq feet co-working space. A similar project is being launched in Tokyo."Blockchain technology offers a means to improve transparency," says Christopher Clausen, Associate Director of Asia Pacific Research at JLL. "There's plenty of potential for use across industries, and real estate is another big area for blockchain application as investors are demanding, and expecting, ever-greater levels of transparency."In its simplest form, Blockchain is a distributed database. By recording and combining transactions into a de-centralized ledger system, it creates a "chain" of chronological data that no one party has control of. The value lies in the system's ability to authenticate and track transactions in real time without the use of a third party, such as a bank.Corporates are also taking note. HSBC Australia joined forces with start-up Moneycatcha last year to use its end-to-end blockchain-enabled platform for approving home loans automatically."A blockchain based registry would make it easier for existing owners to market their assets for sale while potential investors would find it easier to identify assets consistent with their investment strategy," Clausen says.Blockchain bodes well for Asia Pacific's bustling Proptech scene, where China and India are leading the way in fundraising, at US$2 billion and US$1.7 billion, respectively, according to JLL's Proptech report."Blockchain offers a new approach to asset securitization and ownership and holds the potential to reduce market liquidity risk," explains Clausen. "The key is really improving liquidity and enabling investors to more easily acquire and dispose of assets."While there is huge potential for blockchain start-ups in the real estate industry, companies will nevertheless require support from the governments in the countries that they operate. Start-ups who experience rigid governmental regulations towards their new business models will face the greatest challenges.So which country has the edge? Here's a closer look at the most promising Blockchain and Proptech developments around the region.ChinaDespite regulating its financial markets tightly with a ban on initial coin offerings, China is still encouraging firms to research blockchain, considering it "a good technology."China-based , a real estate blockchain cloud platform, secured US$30 million in January for its seeding round. The start-up's investors include Draper Venture, the largest venture capital fund in the blockchain sector.Blockchain platform developer Ruizhuoxitou announced a deal in February with China-based NYSE-listed company Xinyuan Real Estate. Ruizhuoxitou provides blockchain-based services such as asset digitisation, rights verification and information authentication. Their blockchain platform had previously been applied in the financial services and insurance industries.IndiaIndia has the largest number of proptech start-ups with 77 of 179 funded in Asia. But many are still in the seed and angel-funding stages. In 2016, India's blockchain start-ups received US$1.7 billion in funding. India's government is also collaborating with corporates to further blockchain's development within the country. The Bengaluru-based start-up PropertyShare and the Pune-based competitor RealX both provide blockchain platforms that allow buyers to purchase fractional ownership of real estate. PropertyShare claims to manage US$11 million in commercial assets with a portfolio of 20 properties across four cities in India. Backed by Japan's Asuka, Pravega Ventures and the Singapore-based Beenext, PropertyShare is eyeing expansion into overseas markets in 2018.JapanJapan is another leader in blockchain. The country legalized Bitcoin and is considered the most advanced country in the crypto field globally.Bitproperty is the major player. Started in Japan, the blockchain driven platform that uses "tokens" for real estate investments is now expanding globally. It recently partnered with two companies to strengthen its offering. Nikken Housing, a Japanese real estate development company to make some of its projects available to Bitproperty investors. And Alphabit, a digital currency fund.SingaporeSingaporean start-ups are also adopting blockchain to tokenize property. FundPlace and Reidao are both using the platforms to create tokens backed by real estate that investors can buy. FundPlaces announced in January 2018 that it had raised US$1.5 million from a Singapore-based investor and has completed several proof of concept transactions in Singapore and New Zealand using their platform.AustraliaAustralia's scene is heating up. Besides the HSBC-Moneycatcha tie-up, there are the likes of Propify, a start-up behind the first real estate Blockchain platform to securely market property via social media and search engines.The country is also ahead of the game in terms of digitalising property ownership. Many point to the success of Property Exchange Australia Ltd (PEXA), a three-year-old company digitalizing the process of land ownership valued at A$800 million and growing fast, which demonstrates an industry ripe for blockchain-based solutions.Article by Claire Slattery

Why France's hotel sector is on the road to recovery - JLL Real Views

JLLH ·30 April 2018
Just under 89 million tourists visited France in 2017, according to French government figures, a five to six percent year-on-year rise that puts the country back on track to reach its ambitious 100 million target by 2020. It's a welcome turnaround from the previous year, when tourist numbers in the worst-hit region of Greater Paris fell by 1.5 million in the wake of a spate of terrorist attacks. By September 2016, hotel RevPAR (revenue per available room) was down almost 16 percent on the previous year.Gwenola Donet, JLL's Head of France for the Hotels & Hospitality Group, says the recovery is expected to accelerate in 2018 thanks to a wide range of positive factors."There are signs that the world has learned to live with terrorist attacks. We've seen this in Barcelona, where only a couple of weeks after the August 2017 attack tourism returned to normal levels," she explains."What's more, people are viewing France in a more positive light following Emmanuel Macron's win in the presidential election, along with other positive news such as Paris being chosen to host the 2024 Olympics. This not only helps with tourism, but also creates hope that Macron's reforms will make France easier to do business in from a tax and labour law perspective."U.S. tourists prove good for businessThe more favourable climate has resulted in U.S. tourists returning to France. Romain Semmel, Senior Vice President, European Transactions at JLL Hotels and Hospitality, explains that a rise in visitors from the U.S. tends to push prices up, which should help hotel rates recover. This, in turn, is helping to revive investor interest in the country."There is a more positive sentiment among investors and, although it is too early to make a firm assessment, it is likely that with the UK being blocked because of Brexit and Germany's difficult economic situation, France's more stabilized economy will make it even more appealing," Semmel adds.Paris is attracting the lion's share of investor interest but the regions, which have stayed fairly resilient over the past few years, could also see some notable deals.High net worth individuals are seeking trophy assets in the French Riviera, while the Alps has opened up to external investors after being largely confined to deals between families. Club Med, meanwhile, has announced plans to open one new resort each year in the Alps.Limited supply fuels an innovation boomIn Paris, the recovery is being helped by the fact that French cities, including the capital, are relatively small and so do not have the same capacity to increase hotel supply like other cities like London and New York.This is not only helping to lift rates, but is also encouraging hotel operators to be innovative in how they attract tourists.Donet says operators are looking at new forms of accommodation that offer "affordable luxury" and that provide a place to sleep and have fun in. The flexibility of hotel management models is also increasing - a sign, Donet says, of a mature market."In Germany you will find lots of leased hotels, whereas in the UK hotels are mainly managed or franchised. In France, investors can find a range of models to suit their profile, whether it's managed, franchised, non-branded or business-only," she explains. "Hotel operators are very flexible and will adapt their model to suit investors' requirements; we've especially seen this in Paris, where operators have designed very specific, bespoke hotel management agreements."Meeting the needs of the modern travelerOne of the biggest challenges for France's hotel market will be ensuring it stays up-to-speed with the tastes of modern travelers who are increasingly keen for unique features and memorable experiences.Donet says that France still has some hotels that are aging and in need of renovation. A major catalyst could be Accor's Booster project, which aims to free up funds to improve its properties in the country. "Accor is a massive player in France so this initiative is likely to accelerate the trend of innovation," she says.And the brightening picture for the hotels market could well reward hotels that refurbish in line with the times or come up with creative new accommodation concepts. Donet expects Paris to be back to its pre-2016 RevPAR growth levels by the end of the year and to continue strongly in 2019."This is the right moment for investors to enter the market because they can still benefit from the capital's recovery," she says. "It is the first time in a long time that all the KPIs (key performance indicators) are looking positive."

Amusement parks jump to the front of the line with green energy - JLL Real Views

JLLH · 6 April 2018
Solar-charged rollercoasters, wind-powered Ferris wheels and other renewable-powered attractions could become business as usual for the amusement parks of the future.Already, a handful of major theme park companies are embracing green energy, from California and New York to the United Kingdom.Most recently, Six Flags Entertainment Corporation committed to powering two of its California parks almost entirely with energy from the sun. Beginning later this year, Six Flags will generate at least 7 megawatts (MW) of electricity with solar panels strategically located over the parking lot of its Discovery Kingdom in Vallejo, California. A second system at Magic Mountain, near Los Angeles, will have capacity for nearly 15 MW, making it the largest solar carport in North America.And over in New Jersey, Six Flags is transforming one of its existing sites into the world's biggest theme park to be completely powered by solar energy, preventing as much as 1.5 million tons of carbon particles from going into the atmosphere each year.The bright side of solar-powered amusement parksIt's not just the environment that stands to benefit; renewable energy can be incredibly cost-effective, according to Kyle Goehring, Executive Vice President and Head of Clean Energy Solutions, JLL."Amusement parks need a lot of energy to power rides, concessions and offices," says Goehring. During the peak summer season, attendance reaches its highest levels and rides tend to be at their busiest in the middle of the the afternoon, when the sun is the brightest. This means they can generate the most power when they are consuming the most energy.That's a big deal in California, which has some of the most expensive utility rates in the country. "By transitioning to solar power, Six Flags expects to save several hundreds of thousands of dollars in the first year alone--and even more as electricity prices go up in the future," says Goehring, who acted as lead agent for Six Flags on the project.Plus, Goehring says that by bringing in solar energy, amusement parks can provide extremely visible evidence of corporate responsibility commitments and even improve the guest experience. "Shaded parking is always an advantage in sunny Southern California, and solar carports make it easier to provide the infrastructure of charging stations for electric vehicles that are increasing in number," he points out.Yet amusements parks don't need to go through huge renovations to become more environmentally friendly and energy efficient."Solar carports, like the ones being developed at Six Flags, have a lot of potential because they're free-standing structures that don't require additional land," says Goehring. "But there are several other ways theme parks can take advantage of renewables, from installing solar on the roof of a ticket booth or over a walkway, to purchasing green power from an offsite provider."For example, California's Great America plans to power its 100-acre park with 100 percent wind energypurchased from an offsite provider. In Florida, meanwhile, Disney World has built a large ground-based solar array shaped like Mickey ears.At Hersheypark in New York an 80-foot wind turbine both produces power and promotes renewable energy to visitors. And across the Atlantic, in Wales, Green Wood Forest Park is 100 percent powered by renewable energy--mostly the sun but also people power, in the case of its Green Dragon roller coaster.Is an all-renewable future possible?While renewable power is becoming more common, there's no one-size-fits-all formula for theme parks. "Every park will have its own set of considerations around renewable energy depending on its location, its revenue and its attractions," says Goehring. "It's important to look at the individual long-term business plan, and analyze whether on-site generation makes economic sense given the growth projections."Goehring also points to the importance of engaging stakeholders at the outset. "A successful project depends on buy-in from the on-site park management team, local utility and community. They need to be involved as early as possible," he advises.And as the economic case gets stronger, green energy may have more supporters. Indeed, with many U.S. states still offering substantial incentives for renewable energy projects, and the cost of solar panels coming down while electricity prices go up, more theme parks are likely to find they too can get on board with green power.

Casablanca is largely dependent on business travellers with limited luxury hotels

JLLH ·23 March 2018
Occupancy rates recovered in 2017 from 62% in 2016 to 66% in 2017, owing to the performance of the 4-star hotel segment catering to conferences and exhibitions across the city.Earlier this year, the Moroccan Central Bank (Bank Al-Maghrib) introduced the gradual floatation of the Moroccan Dirham, providing more flexibility to real estate investors and paving the way for a more buoyant real estate market in the year ahead.According to JLL's Morocco 2018 report, the bank widened the official band within which the dirham may fluctuate to 5 percent, with a maximum daily move of 2.5 percent above or below the official rate. As part of a broader monetary reform, this move is intended to bolster the competitiveness of Morocco's economy and will potentially position the country as a regional economic hub, and the gateway to Africa.The Moroccan economy is expected to record real growth of 4% in 2018, primarily driven by increased domestic consumption and public investment, highlights the report. The economy has attracted increased levels of FDI yearly since 2005 (with the exception of 2015) with real estate attracting around half of the total FDI.The significant increase in FDI aligns with the Moroccan government's Vision 2020 outlining Morocco's goals of becoming one of the world's 20 leading tourist destinations by 2020. Almost 40% of foreign investment is from the GCC region, with a significant proportion of this total being invested into the real estate sector. "The reforms introduced by the Moroccan government, will have a ripple effect on the real estate sector, as investors across all sectors now have the opportunity to be more flexible in their decision making," said Craig Plumb, Head of Research, JLL MENA."If the currency softens against the USD and the Euro, this will effectively make Moroccan property cheaper for investors from markets denominated in these currencies and attract further FDI into the real estate sector across Morocco and most specifically into Casablanca," he added.Another factor likely to result in additional investment into the real estate sector is the launch of REIT's, that will reduce the level of investment required to own real estate and therefore expand the market to a wider range of investors.Although there are no listed REITs on the Moroccan stock exchange as of yet, the merger of VLV and Petra in 2017 resulted in the creation of a new commercial real estate platform comprising of 27 assets (with a total GLA of more than 215,000 sq m) across 15 cities in Morocco.Grit real estate income group (previously known as Mara Delta) has also announced plans to list its Moroccan assets separately as a REIT (with Anfa Place being a prime asset in its portfolio)."REITs will boost the demand for investment in the office market.Casablanca is Morocco's main commercial centre, and has a significantly bigger office market than the capital Rabat. With many national and international companies located in the city there is a growing need for modern office space in Casablanca," said Craig Plumb.The retail market in Casablanca is largely dependent on street retail, however organised retail malls are becoming increasingly preferred, reflected in the high footfall levels across major centres such as Morocco Mall and Anfa Place Shopping centre. "The continued move towards retail malls will create future opportunities for both developers and investors" said Plumb.Casablanca's hospitality market is largely dependent on business travellers, and has relatively limited hotels in the luxury segment. Occupancy rates recovered in 2017 from 62% in 2016 to 66% in 2017, owing to the performance of the 4-start hotel segment catering to conferences and exhibitions across the city."With the government's vision 2020 of converting Morocco into one of the world's hottest tourist destinations by 2020, occupancy rates seem to be growing positively. We look forward to seeing strong results in the hospitality market this year as performance shows an upward trajectory," he added.Being the gateway location between Europe and Africa, Morocco has attracted a number of major international manufacturers such as Renault Nissan investing into the key industrial areas. The government launched an industrial acceleration program in 2014, which is designed to generate half a million jobs in the industrial sector that will in turn significantly increase Morocco's GDP as well as providing further opportunities for real estate developers and investors.For further information, please download the full report here.

Can Saudi Arabia become the Middle East's new entertainment hub?

JLLH ·15 March 2018
Saudi Arabia is aiming to ring in a new chapter in its history with a range of developments to position it as a leisure destination for residents and overseas visitors.The kingdom is planning to invest $64 billion in its entertainment industry over the coming decade as part of an ambitious program of social and economic reform, known as Vision 2030, to reduce its dependency on oil.Mohamd Alkhateeb, Analyst at JLL in Saudi Arabia, says: "The goal of the entertainment fund is to build Saudi Arabia's much-needed tourism infrastructure. The government is providing financial backing, but there are many opportunities for the private sector to get involved in the development and operation of new leisure facilities - whether that's opera houses, concert halls, cinemas or museums."Building an entertainment industrySaudi Arabia has already taken steps to make its entertainment ambitions a reality. Last year, it revealed plans to build a 334 square kilometer "entertainment city" to the south of Riyadh, featuring sports, cultural and recreational facilities such as a safari and a Six Flags theme park. Riyadh will also become home to two major malls, including the Mall of Saudi with 300,000 square meters of retail and entertainment space.Meanwhile, companies are lining up to open cinemas after Saudi Arabia decided to lift its 35-year ban. More than 350 cinemas could open by 2030, including 30 multiplexes from UK operator Vue International, and more from US-based AMC Entertainment, which has signed a provisional agreement with PIF - Saudi Arabia's sovereign wealth fund. The first of these new cinemas are likely to be very different from those in the western world, with separate viewing areas for families and single men, as well as strict censorship.Foreign companies are also keen to tap into the flourishing events scene in Saudi Arabia, which recently hosted its first ever jazz festival. Almost eight million visitors attended 2,200 events in 2017, and this is expected to rise to 15 million visitors across 5,500 events in 2018.The vast majority of these visitors are local residents and it will take time for Saudi to build its reputation beyond its own borders. "International events enjoy high demand among Saudi Arabia's young population," says Alkhateeb. "Yet Saudi's entertainment and leisure sectors still need time to develop before Saudi is recognised as an international leisure destination."Creating an audience closer to homeMuch of the development aims to establish Saudi Arabia as a holiday destination among domestic tourists, who are currently drawn to the Middle Eastern hotspots of Dubai and Bahrain. About one million Saudis visited Dubai in 2017 and the Saudi government hopes the entertainment fund will encourage them to spend more of their holidays closer to home, particularly given the added pressure on household spending resulting from the higher cost of living.Alkhateeb believes it could work: "The shorter term impact will be softer demand for leisure and entertainment in Bahrain and Dubai from Saudi households as entertainment options increase locally."Longer-term, Vision 2030 aims to double the share of domestic household spending that goes on Saudi entertainment to six percent by 2030.Foreign tourists, meanwhile, are being enticed by the relaxation of tourist visa requirements for certain nationalities - and the prospect of more international visitors is fuelling the hotel room pipeline. According to STR, there are more than 64,000 additional guestrooms under development across the kingdom, marking a 76 percent increase in the current room inventory of the 84,500.Apart from job creation, the focus on entertainment could deliver other economic benefits, Alkhateeb explains. "With more people likely to spend their vacation domestically, retail sales could remain more stable year-round as opposed to the historic trend of sharp declines during the holiday season. Hospitality may witness growth as leisure tourism could offset the decline in corporate demand, which followed the slump in energy prices," he says.For investors, the move by the Saudi government offers opportunities in the entertainment, sports and cultural sectors. Alkhateeb says theme parks, opera houses, museums and concert spaces all require a wide range of real estate and architecture expertise through from design to leasing and maintenance.Yet conditions differ from many other markets. "A lack of local benchmarking and transparency could pose a challenge to investors looking to operate in the kingdom. However, the strong political will to grow Saudi's entertainment industry means we should see regulations and guidelines become increasingly clearer to support this growth," he concludes.Article by Emily Perryman

Record-breaking Q4 2017 real estate investment volumes in Asia Pacific sound a positive note for 2018

JLLH ·13 March 2018
SINGAPORE -- Investment volumes in the last quarter of 2017 reached a new high of US$52 billion in Asia Pacific, up 16 per cent compared to the same period in 2016, according to new data from real estate consultant JLL.Traditional favourites Hong Kong, Australia and Japan all saw an increase in transaction volumes, with Hong Kong's red-hot market leading the way. Its Q4 transaction volumes reached US$7.4 billion, a 171 per cent year-on-year increase driven by mega-deals such as the US$1.15 billion sale of Wheelock's 8 Bay East in Kwun Tong. Australia (+40 per cent) and Japan (+31 per cent) followed behind Hong Kong. The Hong Kong figures exclude the US$5.2 billion sale of The Centre, which will close in early 2018.Hong Kong capital values climb"The sale of The Centre makes it the most expensive office building in Hong Kong and the biggest property transaction in Hong Kong's history, ahead of the US$2.98 billion sale of the Murray Road site in Central in May. Capital values of Grade A offices surged by 17.5 per cent in 2017, the strongest growth among all real estate sectors," says Joseph Tsang, Managing Director and Head of Capital Markets at JLL Hong Kong. "While the limited supply of Grade A office assets available for sale may hinder investment activity in 2018, we believe that there is still sufficient demand for capital values to rise a further 10 per cent."Institutional investors and sovereign wealth funds from Singapore and Hong Kong made up US$2.9 billion and US$2.2 billion of total Q4 transaction volumes in Asia Pacific respectively, continuing the trend of increasing portfolio allocations to real estate.Across the region, the office sector made up half of all transaction volumes in Q4 2017. Retail bounced back to account for a quarter of Q4 volumes, supported by the growth in the retail sector in Hong Kong which saw retail sales record the strongest growth (7.5 per cent year-on-year) in nearly three years.Investor interest in Australia moves beyond usual suspects Sydney and MelbourneAustralia remains a top pick for investors with its comparatively higher yields, strong rental growth prospects in Sydney and Melbourne, and position as one of the world's most transparent real estate markets. Investment volumes in Australia reached US$7.2 billion in Q4 2017, compared to US$5.2 billion in Q4 2016."Investors from Singapore, Hong Kong, Japan, the United States and Canada continue to focus on prime properties despite a lack of available stock. While Sydney and Melbourne remain the favoured investment destinations, tighter pricing and a shortage of opportunities have resulted in increased activity in Brisbane, Perth, Adelaide and Canberra. Brisbane commercial property markets accounted for more investment activity during the quarter (US$1.9 billion) than Melbourne did (US$1.1 billion)," says Andrew Ballantyne, Head of Research, JLL Australia.Foreign investors remain active in Japan Transaction volumes in Japan reached US$10.5 billion in Q4 2017, up 31 per cent year-on-year, with foreign investors remaining active. Norges Bank Investment Management, the Norwegian pension fund, made their first Asia Pacific real estate investment in Tokyo in December. The joint venture with Tokyu Land saw them scoop a portfolio of five prime retail assets."Japan remains one of the core markets in the region for investors due to its low cost of debt and deal availability. Robust foreign trade has helped fuel the longest economic expansion in nearly two decades and will remain a key driver of growth in the short term. Tokyo remains top of the investor list, accounting for 45.5 per cent of total Q4 transaction volumes. Investors have also been looking beyond Tokyo at the surrounding prefectures of Chiba, Kanagawa and Saitama, which accounted for 22.2 per cent of total investment volumes in Q4. Some of the largest deals of 2017 have been heavily concentrated in the outer areas of metropolitan Tokyo, in particular Yokohama," says Takeshi Akagi, Head of Research, JLL Japan.For more information, download our "Global Capital Flows" report.

Mexico Hotel Destinations - 2018

JLLH ·13 March 2018
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How restaurants are serving up entertainment like never before

JLLH · 6 March 2018
From the jazz quartet belting out crowd-pleasing covers to cabaret performers high-kicking their way across the stage, food and entertainment have long gone hand-in-hand to make for a memorable meal out.Now a new generation of eating establishments is adding its own twists to the concept of 'dinertainment' to stand out from the crowd and pull in diners who want more than just music and cocktails alongside their main course. And they're expanding quickly in big cities.Take Swingers, which combines street food with cocktail bars and indoor crazy golf; it's opening its second site in London. In Paris, luxury bus-restaurant Bustronome shuttles guests between the city's top sights as they dine while in Dubai, Inked curates one-off dining experiences from a surrealist Dali-inspired feast to monochromatic meals.Even cinemas are focusing more on offering higher-end dining options as they look to revitalise the experience of a night at the movies. Cine de Chef, for example, has branches in Seoul, South Korea and Kathmandu, Nepal while Alamo Drafthouse has outlets across the US where movie-goers can order chef-cooked meals while watching a film."The genre is being re-invented now that there is more competition in the eating out market and consumers need more to persuade them to leave the house rather than order in," says Florence Graham-Dixon, Associate Director in JLL's Foodservice team. "When food collides with art, gaming, theatre or technology, it gives people the opportunity to try something different while socialising with their friends. And of course, these locations make great backdrops for social media posts."Technology takes dining to a new levelNew technology is offering many different - and novel - ways to spice up the dining experience. "More restaurants are incorporating virtual reality into their operations because it allows them to create unique experiences that people want to be a part of - and then tell their friends about," says Graham-Dixon. "The most extreme example I've heard of is apocalypse-themed restaurant Mad Rex in Philadelphia where diners are given VR headsets to experience an apocalyptic video game while they eat."Similarly, several pioneering bars now serve cocktails with VR headsets that take them through the provenance of the drink; order an Origin from the menu at the One Aldwych Hotel in London and the waiter prepares the cocktail as the headset whisks the wearer off to the Scottish Highlands."As VR technology is getting cheaper it represents a great way for food service brands to connect with customers in a more profound way," says Graham-Dixon. "Some of these new concepts are genuinely innovative and exciting, bringing new ways for people to socialise or learn about what they are consuming."Big-name brands are also experimenting with their own tech offerings; Starbucks, for example, is launching an in-store Augmented Reality experience for Chinese customers where they can take a virtual tour of the coffee roasting process through the app.Other restaurants opt for lower-tech but equally creative approaches. French restaurant Le Petit Chef in Berlin, for example, projects a miniature chef cartoon onto diner's plate who illustrates how the dishes are made before they are presented. Similarly, Tokyo Artist Collective Teamlab created an interactive restaurant interior that takes diners on a journey through the seasons using digital screens on the walls and table, as corresponding seasonal dishes are served.Location, locationFor retailers, the appeal of offering something unique has to be balanced against space and cost requirements. "Tech can easily be installed in smaller spaces to help drive PR and footfall for the restaurants yet there will be a significant initial outlay," say Graham-Dixon. "Consumers quickly tire of gimmicks so restaurants with dinertainment ambitions need to come up with something quirky and different that still has longevity."Other dinertainment set-ups such as Swingers or bar-and-restaurant-meets-ping-pong center, Bounce, need bigger spaces that come with different challenges. "They will only work in specific locations with significant footfall to make up for the higher rents or up-and-coming areas with a gravitational pull that means people are prepared to make the journey," Graham-Dixon adds.She believes that brands with a unique selling point could be a good fit for developers looking to build modern genuine lifestyle hubs rather than traditional shopping centers, especially those that appeal to a large target audience.Yet it's not just about the entertainment; the food still needs to be good quality and reasonably priced - especially if it's not included in the entrance price.While there are plenty of new dinertainment set-ups opening for business in cities around the world, demand for dining with a difference remains strong. "Experiences are the new status signifiers, so concepts that embrace this will do well," Graham-Dixon says. "Consumers are continuing to spend more on leisure activities than retail - food service brands are well aware of this and so it's likely we'll see more growth and more creativity in the dinertainment space. Unexpected, immersive and impressive experiences will capture consumers' scarcest resource - their attention."

Bringing experiential travel to the Americas

JLLH · 1 March 2018
From sharing a yurt with a nomadic family to sleeping among the monkeys in jungle treehouses, today's travelers are increasingly on the lookout for authentic experiences and exotic adventures.This shift has created and fueled demand for experiential travel - a form of tourism where people focus on experiencing a destination by connecting to its nature and landscapes, culture, residents and way of life.Experiential travel first took off - and is still most prevalent - in Africa. Think luxury tents on the Serengeti plains of Tanzania or a safari in the wilderness of the Okavango Delta in Botswana. Now, hoteliers believe it's time for experiential travel to take hold in the Americas."The majority of the demand for experiential travel in Africa is coming from the U.S. and Canada," explains Luca Franco, President and CEO of Luxury Frontiers. "Right now, supply is limited in the Americas, so the growth potential is enormous."A new way of experiencing the AmericasWith its multitude of natural attractions - and no shortage of space - the Americas offer plenty of development opportunities for experiential travel sites.Patagonia, the Amazon, Argentina and Peru are prime candidates in South America: they have the land needed for development and are home to incredibly popular tourist attractions from majestic national parks to well-preserved historical sites. Guided tours provide the accessibility tourists need as well as local familiarity that helps keep the experience genuine, while helping supplement the limited public transportation of the region."These locations are perfect for experiential travel as they're easily accessible, and their residents generally speak one of two languages: English and Spanish," notes Franco. "South America has so many beautiful, natural places that are ripe for development."In the continental U.S., opportunities are abound in Montana, Colorado and the Southwest, especially California, Arizona and Utah, where a plethora of national parks already draw in millions of visitors a year. British Columbia is on developers' short list in Canada, as well as remote areas of Manitoba and Quebec.What's the catch?Finding open land and developing a unique experience isn't all it takes to succeed in the experiential travel sector."Experiential travel must be consumer-driven," says Franco. "You have to start with what the consumer wants and then create a product or an experience that exceeds their expectations. Experiential travelers are looking beyond the walls of a hotel or simple sightseeing. They want to collect life-defining memories. These travelers are looking for moments that stay with them long after the vacation is over. Projects that are engaging and designed to continue attracting guests for three, five years down the road are the ones that will succeed in the long term."So what do consumers want from their experience-based travel? "Travelers want to feel immersed in local culture. They want to embrace a destination's climate, heritage and cultural norms - they want to feel like they're a part of the community," says Dan Fenton, Executive Vice President, Tourism, with JLL's Hotels & Hospitality Group.Consumers also want to discover their destinations through educational or physical adventures, and they seek connection to their environments, their companions and themselves via spiritual and inspirational moments during their travels."Sustainability is also key as younger generations become more aware of their impact on the world around them and actively choose experiences and accommodation options that are socially and environmentally responsible," says Fenton.According to a report, 68 percent of travelers are more likely to choose a particular accommodation if has eco-friendly credentials. And more resorts are taking note, says Fenton, from using recycled materials to effectively managing energy consumption and waste management to limit their impact on the environment.Creating experiential travel for tomorrowWhile experiential travel may be in its infancy in the Americas, it's nevertheless a fast-evolving concept within the wider travel industry. "Right now, the market is attracted to luxury tents and luxury treehouses," Franco explains. He predicts that floating rooms - a tent or cabin built on a deck that can float on a lake or other body of water - will be the next trend to shake up experiential travel."The opportunities for experiential travel are endless. You can rent an entire island in the Maldives," says Franco. "Destinations and developers have to think big about how they'll create memorable and unique experiences and adventure-based travel that will attract tourists from around the world."Yet many travelers are keen to fit in numerous experiences on a single trip. As such, Franco notes that itinerary-based travel will be at the top of travelers' to-do lists. This system gives consumers the opportunity to enjoy different cities, experiences and cultures within a relatively short time frame.Indeed, as more consumers become more ambitious in their vacation plans, experiential travel is set to make a lasting impact on America's hospitality industry. "The opportunity is tremendous. The market is here, the demand for outdoor adventure and eco-friendly tourism is here - now it's down to America's hospitality industry to create and deliver the experiences," concludes Franco.


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