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US hotel occupancy down in Q3; WeWork files for Chapter 11 protection


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US hotel occupancy down in Q3; WeWork files for Chapter 11 protection

S&P Global Market Intelligence offers our top picks of real estate news stories published throughout the week.

The US hotel sector saw a 1% year-over-year drop in occupancy in the third quarter on the back of a slight decrease in demand and an incremental increase in supply, according to a report by real estate services company CBRE Group Inc.

Consumer spending remained strong, although competition from other lodging sources like short-term rentals and cruise lines, as well as increased outbound international travel, curbed hotel demand and pricing power in the third quarter.

Revenue per available room slid 0.3% year over year, as the modest decline in occupancy was partially offset by the rise in average daily rate, which grew 0.6% in the June through September period.

Occupancy rates for all location types in the third quarter were still below 2019 levels. Hotel occupancy in town locations were the closest to 2019 levels, at 97%, followed by occupancy in urban locations at 92%.

CHART OF THE WEEK: 6 US REITs report WeWork as among top tenants

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⮞ Six US equity real estate investment trusts this week reported that WeWork Inc., which filed for bankruptcy Nov. 6, was one of their top tenants.

⮞ Armada Hoffler Properties Inc. disclosed two leases with WeWork, with annual base rent totaling $3.7 million as of Sept. 30, equal to 1.8% of Armada's portfolio.

⮞ Boston Properties Inc.'s annual base rent from WeWork equate to about 1.2% of its portfolio.

WeWork reorganizes

– WeWork filed for protection under Chapter 11 of the US Bankruptcy Code, though the filing excludes the company's locations outside the US and Canada. It identified 69 sites in North America where it aims to reject leases as part of the filing, The Business Journals reported. Forty of the identified locations are in New York City.


– Hilton Grand Vacations Inc. agreed to acquire Bluegreen Vacations Holding Corp. in a $75-per-share all-cash transaction for total consideration of approximately $1.5 billion, including net debt. The transaction is expected to close during the first half of 2024, subject to customary closing conditions and regulatory approvals.

– Weinstein Properties acquired the 315-unit Alexan Summerhill apartments in Atlanta, the Atlanta Business Chronicle reported, citing Fulton County property deeds. PGIM Real Estate sold the asset for $94 million.

See key people moves in North America real estate.

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