Atlas in the news

The Real Deal 04/02/20 CA Hotel Industry Sees 3,600 Job Cuts Amid COVID-19 Crisis 3,600 workers laid off over 4-day period in March By Matthew Blake https://therealdeal.com/la/2020/04/02/expedited-layoffs-mean-thousands-of-hotel-job-cuts/ A little noticed executive order by CA Gov. Gavin Newsom has accelerated layoffs in the state’s hotel industry — with pink slips issued recently to nearly 3,600 workers in March. The job cuts, which for now are officially reported as temporary layoffs, are perhaps the most tangible sign yet of California’s hotel industry in freefall amid the coronavirus crisis. Newsom announced on March 17 a partial suspension of the state’s Worker Adjustment Retraining and Notification Act, better known as the WARN law, which normally compels employers to give workers and the public 60-days notice before carrying out layoffs of 50 or more employees. Under the governor’s order, employers must still report mass layoffs to the state’s Employment Development Department. But companies can enact the layoffs immediately if the pink slips are the result of measures taken in response to the coronavirus, a new rule hotels were quick to utilize. “In my lifetime I have never seen damage as swift to the industry, plus with such an unknown end,” said Peter Hillan, spokesman for…

Santa Cruz Sentinel 03/30/20 Coronavirus: Bay Area Hotel Layoffs Might Just Be Start of Job Losses By George Avalos Coronavirus: Bay area hotel layoffs might just be start of job losses SAN MARTIN — At least 1,400 hotel workers in Northern California have lost jobs or been shoved into indefinite furloughs amid the coronavirus fallout, but these might be just a grim vanguard of further economic reductions. Hotel worker layoffs in the Bay Area and nearby regions total at least 1,431, according to new estimates by state labor officials, but several experts warn that the newly announced cutbacks are merely the beginning of widespread economic devastation in California’s crucial lodging and travel sectors. “This is only the start of the hotel layoffs,” said Alan Reay, president of Irvine-based Atlas Hospitality Group, which tracks the California lodging market. “The majority of hotels in California and nationwide are reducing operations or closing temporarily.” More than 400,000 jobs supported by the hotel sector or directly connected to hotel operations are expected to be cut in California, according to an Oxford Economics study released by the American Hotel & Lodging Association. “Those numbers may be conservative,” Reay said. Roughly 414,000 jobs, or a staggering…

Sacramento Business Journal 03/27/20 Coronavirus Fallout May Test Commercial Real Estate Industry’s ‘Extend and Pretend’ Limits Emily Hamann & Ben van der Meer https://www.bizjournals.com/sacramento/news/2020/03/27/coronavirus-fallout-may-testcommercial-real-estate.html The last time the U.S. economy was in crisis, terms such as “jingle mail” and “extend and pretend” became commonspeak among the thousands of men and women earning their keep in the commercial real estate sector. What’s unfolding today in the age of the coronavirus undoubtedly will add to that insider vocabulary, and then some. A Business Journals analysis of the commercial real estate market identified 4,600 properties securing $30 billion in commercial mortgage-backed securities, or CMBS, debt coming due in the next six months. With the global economy in a tailspin and nary a sign of it stabilizing, the likelihood those loans will be paid in full — whether through refinancing or property sales that can satisfy lenders — is slim. The shrapnel from this ticking time bomb will be absorbed in virtually every major metropolitan area in the country. In Washington, D.C., some $1.8 billion in CMBS debt secured by 67 properties is coming due by Sept. 30. In Los Angeles and Boston, the totals are $1.46 billion and $1.31 billion, respectively, and the…

San Diego Business Journal 03/17/20 2019 Was Solid Year for Hotel Sales By Tom York https://www.sdbj.com/news/2020/mar/17/2019-was-solid-year-hotel-sales/ San Diego’s hotel industry has been rolling along for the past decade. But how long will the good times last? Well, it depends, says Alan Reay, president of the Atlas Hospitality Group, which brokers hotel sales. The industry could be in for a rough night. “The clouds are on the horizon,” he said. Reay recently released Atlas’ annual 2019 Year-End California Hotel Sales Survey, which covers hotel property sales region by region in the state and touches upon the economics of the industry in the process. Overall 2019 was a solid year for hotel property sales, the report from the Irvine-based Atlas notes. Sales based on the price per room dipped 2.6 percent compared with 2018. “It’s obviously still a robust market,” he said. “But the question on a lot of owners’ minds is this: If we’re not at the peak, how close are we to it?” Reay said. Some of the other findings of Reay’s annual report: • Atlas’ annual survey found that total sales for San Diego hotel properties dropped to 20 from 27 in 2019, through the dollar amount jumped 82%….

The Orange County Register 03/09/20 How Coronavirus Burst California’s Tourism Bubble By Jonathan Lansner How coronavirus burst California’s tourism bubble California’s tourism bubble has burst, an economic victim of the coronavirus outbreak. It’s hard to chat about commerce when the key issue is the largely unknown scope and impact of a killer virus. But when financial markets are tanking, as they did again on Monday, and travel is slowing to a crawl, the monetary fallout seems fair game. Look at what’s at stake: A globe’s worth of folks come to California for pleasure and work. The rush created surprising and outsized business opportunities in and around tourism, an industry that was hammered by the Great Recession. Tourism, both statewide and globally, made a quick and strong rebound from the financial debacle of the late 2000s. Industry insiders and analysts alike certainly didn’t see the new consumer fervor for travel “experiences” coming. Also missed by the gurus was a solid revival in business travel, corporate expenditures once perceived as a dinosaur at risk in a modern age of communications. This stunning tourism turnabout flooded the industry with opportunities that were met with hard cash: Billions were spent on everything from new…

The Mercury News 03/05/20 Downtown San Jose Hotel Eyed Near Google Village, SAP Center, Henry’s By George Avalos Downtown San Jose hotel eyed near Google village, SAP Center, Henry’s SAN JOSE — A new hotel could sprout in downtown San Jose near Google’s proposed transit village, the SAP Center, and Henry’s World Famous Hi-Life restaurant, according to preliminary proposals being shown to city officials. The proposal for a hotel on West St. John Street near North Almaden Boulevard is being circulated by BPR Properties, a family-run company founded in 1973 that develops and manages hotels. Palo Alto-based BPR Properties envisions the development of a six-story hotel that would replace three houses located in the River Street Historic District in downtown San Jose. “The hotel would have 105 guest rooms and 41 parking spaces utilizing mechanical parking lifts to maximize the number of parking spaces,” BPR Properties stated in a document that was submitted for the city staff’s for early review and initial assessments. It’s possible that the project would require a historical preservation permit and a historic report, according to Laura Meiners, a San Jose city planner. A hotel at this location would appear to be well-suited for guests who…

San Francisco Business Times 03/04/20 The Coronavirus Has Already Cost the City 150,000 Hotel Nights By Alex Barreira https://www.bizjournals.com/sanfrancisco/news/2020/03/04/the-coronavirus-has-already-cost-the-city-150-000.html   Coronavirus-related cancellations at the Moscone Center have already cost hotels in the city about 150,000 room nights, according to convention officials and Business Times estimates. At least six large scheduled meetings have been canceled at the city’s convention center, with some meeting organizers opting to hold virtual conferences so attendees do not have to travel and congregate in large groups. Officials say it’s too early to quantify the economic impact so far, but the loss of those tens of thousands of attendees is expected to have a ripple effect across the city, with restaurants and other tourist-related businesses expected to suffer revenue declines and potentially smaller profits. “It’s going to be very, very painful,” said Laurie Thomas, executive director of the Golden Gate Restaurant Association, whose membership includes hundreds of eateries in the city. She said food businesses she’s spoken with have lost “easily over $1 million” just in the week since event cancellations began to gather pace. “I thought I’d never have to plan for this.” As of Wednesday night, those cancellations include the Game Developers Conference, Google Cloud…

HotelNewsNow 03/06/20 California Hotel Sales Increased in Second Half of 2019 Though the year was off to a slow start, hotel owners showed more interest in making deals in California thanks to continuing favorable conditions. By Bryan Wroten http://www.hotelnewsnow.com/Articles/300643/California-hotel-sales-increased-in-second-half-of-2019 REPORT FROM THE U.S.—California hotel sales increased during the second half of 2019 after a forecasted economic recession never materialized and demand continued to grow in the state. Atlas Hospitality Group’s California Hotel Sales Survey 2019 Year-End reports that while the number of sales in 2019 fell below the running five-year average of 331, its total of 297 sales was a 6% increase over 2018. The median sales price per room dipped by 2.6% year over year, but it was still the second-highest median price per room on record. Total dollar volume grew 7.4% year over year, coming in at the fourth highest on record. Many people were forecasting a slowdown in the economy or even a recession, so many people took a wait-and-see attitude in the first half of the year to see what would happen with the market, Atlas Hospitality Group President Alan Reay said. However, revenue per available room grew in California, and it grew at a higher…

Hotel Management 02/25/20 Total Dollar Volume for California Hotel Sales Grows in 2019 By Alicia Hoisington https://www.hotelmanagement.net/transactions/total-dollar-volume-for-california-hotel-sales-grows-2019 Total dollar volume for hotel sales in California as of year-end 2019 was up 7.4 percent compared to 2018, according to Atlas Hospitality Group’s “California Hotel Sales Survey: 2019 Year-End.” That was also the fourth-highest growth on record. During the year, 297 hotels in the state changed hands, a 6 percent increase over 2018 but still below the running five-year average of 331 deals, according to the report. Meanwhile, the median sales price per room dropped 2.6 percent from the record set in 2018. However, it was still the second highest median price per room since data has been recorded, and the figure has increased more than 120 percent over the past 10 years. Additionally, a new record high sales price per room was set with the sale of the Montage Hotel Beverly Hills at just under $2.1 million per room. This was 21.3 percent higher than the previous record set by the Malibu Beach Inn in 2015. Following are some notable figures and sales from the report. Growth Counties Orange County experienced the highest jump in total dollar volume growth, rising 188…

Kamla Hotels Sells Anaheim Hotel for $13.7 Million Investor Buys 94 Room Hospitality Property in Orange County By Jason Kuyper https://product.costar.com/home/news/shared/1383771004 Tri-lin Holdings LLC acquired the 94-room Capri Suites Anaheim Convention Center hospitality building at 2141 S. Harbor Blvd. in Anaheim, California, for $13.65 million, or about $145,000 per door, from Kamla Hotels. The four-story, 47,014-square-foot hotel property, formerly a Ramada by Wyndham, was constructed in 1962 in Orange County. Robert Feist with Atlas Hospitality Group represented the seller. Oliver Shah, also with Atlas, represented the buyer.

The San Diego Union-Tribune 02/24/20 Value of San Diego Hotels Sold in 2019 Surges More Than 80 Percent Hyatt Regency hotels on Mission Bay and at the Aventine were the priciest sales last year By Lori Weisberg https://www.sandiegouniontribune.com/business/tourism/story/2020-02-24/value-of-san-diego-hotels-sold-in-2019-surges-more-than-80-percent San Diego’s hotel real estate market, defying predictions of a slowdown a year ago, remains strong following a more than 80 percent increase last year in the total dollar volume of sales transactions. In all, 20 hotels, accounting for more than 4,100 rooms, changed hands in 2019, according to a year-end report prepared by Orange County-based Atlas Hospitality Group, which tracks the California hotel market. While there were seven fewer transactions last year than in 2018, the total number of rooms encompassed by the sales was double the number of a year earlier. Leading the sales last year in San Diego, by total number of rooms, were the 1,053-room Sheraton San Diego Hotel & Marina on Harbor Island, the 438-room Hyatt Regency Mission Bay, and the 417-room Hyatt Regency La Jolla at Aventine. Even with the relatively robust sales volume, it was still far off the last decade’s peak, in 2011, when more than 40 hotels sold for a collective value of…

Bisnow 02/20/20 Buyers Continue to Show Strong Interest in California Hotel Investments By Joseph Pimental https://www.bisnow.com/orange-county/news/hotel/buyers-continue-to-show-strong-interest-in-california-hotel-investments-103071 Nearly 300 hotels worth more than a combined $6B traded in the Golden State last year, a 6% increase in transactions and a 7.4% jump in total dollar volume from the previous year, according to a new report. Atlas Hospitality Group’s California Hotel Sales Survey 2019 year-end report released Wednesday found that 157 hotels sold for $3.4B overall in Southern California last year. Northern California had 140 hotels change hands in deals totaling $2.6B. “California saw a rebound in the number of individual transactions in 2019,” according to the report. “Buyers continued to show strong interest in Golden State hotel investments.” In a follow up email to Bisnow, Atlas Hospitality President Alan Reay said several factors contributed to the increase in sales transactions and the rise in total dollar volume in the state. Record low-interest rates, foreign buyers, and alternative-use buyers and investors converting hotels to low-income housing were among several factors that led to the increase in hotel acquisitions in the state last year, Reay said. “We have seen deals being financed on the CMBS side at sub 4% rates, when typically the…