My interest in Starwood Hotels financial statements is a search for information on hotel properties and average room rates. I simply want to assess trends of where room rates are increasing, how many hotels are in each brand, and how hotels are geographically distributed for the Starwood Hotels chain. I am not an investor and the company profits are little interest to me.
Starwood Hotels first quarter financials show significant occupancy increases for early 2010 coming off the devastating hotel conditions of the first quarter 2009. The good news for travelers is rates are down significantly in the USA from a year ago. Starwood is often cited as a pricey hotel chain and the average daily rate numbers for the different brands confirm this fact.
Starwood has nine hotel brands: St. Regis, Luxury Collection, W Hotels, Le Meridien, Westin, Sheraton, Four Points, Aloft, and Element. Four Points is the only real midscale brand and the only brand reported with average daily rates under $100 per night.
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The dreams of a few years back of 500 Aloft hotels by 2012 appear to have been washed away by the economic tide that engulfed the worldwide hotel industry. There were only 39 aloft hotels as of March 31, 2010.
Asia is a bright spot for Starwood in 2010 while the majority share of USA properties in Starwood Hotels, as in other major hotel chains, drags down the overall financials of the company. Starwood may be in better shape than competitors Marriott, IHG, and Hilton due to a lower proportion of North American properties at just under 54% of its global hotel portfolio.
The trends show that luxury hotel rates dropped quite a bit in the US over the past year while occupancy has jumped the most for Starwood’s luxury brands. St. Regis/Luxury Collection average rates in the USA dropped by 13.4% accompanied by occupancy increase of nearly 10%. Remember that the AIG convention in fall 2009 that led to the backlash against luxury hotel stays for business meetings was a meeting held at the St. Regis Monarch Beach in Orange County, California. That hotel subsequently was foreclosed and changed ownership, yet still remains a Starwood Hotel as the St. Regis Monarch Beach.
Many travelers recognize the value opportunity to get luxury on the cheap in 2010. As occupancy rates increase we can probably see a move to push room rates higher in 2010.
Sheraton and Four Points comprise over half of all Starwood Hotels and their numbers are still looking weak on the occupancy front while hovering around 60%, so loyalty promotions can be expected to continue to try and prop up these hotel brand laggards.
Starwood Hotels shows 999 hotels according to the first quarter financials, but the company made a press release on March 31, 2010 announcing the Sheraton Qiandao Lake Resort in China as its 1,000th hotel globally.
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