The great recession appears to have been harder on hotel spa operations than on hotels themselves. According to a new study released by PKF Consulting USA (PKFC), hotel spas experienced deeper declines in revenues and profits than did hotels, as measured by RevPAR, in 2008 and 2009 and also are taking longer to recover. While the hotel industry began to improve in the second quarter of 2010, hotel spas did not show signs of a rebound until 2011. The good news is that spa revenues are expected to continue to grow and even outpace hotel RevPAR changes over the next few years as the economy improves and personal income levels begin to rise.

Because hotel spa services are often perceived as a luxury, the changes in hotel spa revenue since 2006 are not surprising. In the prosperous years of 2006 and 2007, the annual change in unit-level hotel spa revenue was comparable to the changes in RevPAR. However, concurrent with the economic recession, spa revenue declined at a greater pace than other hotel revenue sources in 2008 and 2009, and did not post a year-over-year increase in 2010 as was observed for RevPAR.

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Mark Woodworth, President of PKF Hospitality Research, and Jack Corgel Ph.D., Senior Advisor to PKF Hospitality Research and Robert C. Baker Professor of Real Estate at Cornell University, discuss five reasons for optimism in 2012.

The owners of 382 acres in Port Royal have requested five more years to develop their property under an agreement with the town, citing the slow economy and uncertainty about future land-use rules.

Approved in 2001 and called the Trask Development Agreement because of the surnames of most of the owners, the original 10-year agreement includes land near Shell Point Elementary and by Robert Smalls Parkway. The agreement also includes an option for five-year extensions, with Town Council approval.

The land was part of the dozens of properties annexed into Port Royal in the early 2000s, according to town planner Linda Bridges. Only two significant residential developments have been built on the property: Ashton Point, completed in 2007 with 240 apartments; and Shadow Moss, begun in 2006 and moving forward in phases, Bridges said. She did not know how many homes have been completed in Shadow Moss.

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Equity One Inc. entered into an agreement to sell 36 shopping centers for $473.1 million to Blackstone Real Estate Partners VII.

Three shopping centers are located in South Carolina with two in Bluffton and one in Greenville. In Bluffton, the shopping centers sold are the Belfair Towne Village and Belfair II where Kroger and Stein Mart are the anchor tenants. The Milestone Plaza, in Greenville, also will, be sold in the deal.

Equity One intends to use the proceeds from the sale to reduce debt, fund its redevelopment pipeline and use it in future acquisitions. Closing is expected to occur in the fourth quarter of 2011.

Equity One estimates the transaction will result in a net impairment loss of approximately $32 million to $36 million in the third quarter of 2011, which includes about $17 million related to unamortized debt discount costs on mortgages to be assumed by the buyer.

The supermarket chain Winn-Dixie is being sold for $560 million to Bi-Lo LLC.

The combined company will have about 690 stores and 63,000 workers in eight states in the southern U.S. Winn-Dixie Stores Inc. will become a privately held subsidiary and its ticker will be removed from the Nasdaq. Each Winn-Dixie stockholder gets $9.50 per share in cash, a 75 percent premium to the Jacksonville, Fla. company’s Friday closing stock price.

Bi-Lo, based in Greenville, S.C., runs 207 supermarkets in North Carolina, South Carolina, Georgia and Tennessee.

Winn-Dixie runs about 480 grocery stores, including approximately 380 in-store pharmacies, in Florida, Alabama, Louisiana, Georgia and Mississippi. It has about 46,000 employees.

The companies said Monday that no store closings are expected and the name Winn-Dixie will remain.

Five Points Plaza, a 57,000-square-foot shopping center anchored by Food Lion, has sold for approximately $6 million. The 97 percent-leased center includes a Family Dollar, additional shop space and two outparcels. Drew Fleming and Mark Joines of Cassidy Turley’s Atlanta office represented the buyer, a North Carolina-based private equity group, and Marlene Spritzer of Durham, N.C.-based Spritzer Commercial Properties, LLC represented the seller, a North Carolina-based developer.

From the listing sheet:

• 57,485 SF retail center with room to expand on 8.94 acres
• Anchor tenants include Food Lion and Family Dollar store
• Additional tenants: Andy’s Pizza, Chen’s, Domino’s Pizza, Star Beauty, Sunset Wireless, and Southeast Family Pharmacy
• 100% occupied, and Built in 2000
• Two outparcels 1.11 and 1.24 acres (seller estimated $600,000 value)
• Offered at a 9.8% CAP Rate based upon $6.15 million asking price
• Current financing to be assumed 6.25%
• NOI is $550,890 based on 100% occupancy

On a conference call yesterday, I was asked why I maintain this website. Well, the original intent was to generate some appraisal/consulting assignments, which it has done. It has also helped with general networking, as I routinely hear “you are the one that does the news website right?” Last week, I interviewed an impressive soon-to-be college graduate. Why did he decide to contact me? His father is a real estate professional and subscriber to SCREnews (Thanks Randy). Maintaining the website also forces me to stay on top of what is happening all across the Palmetto State. Brokers and lenders also send me their press releases on closed deals – as an appraiser, I can’t get data any more current than that. So, let’s see….the three to five hours a week help in the following areas:

• Business development
• Networking
• Employee recruitment
• Statewide market knowledge
• Recent sale comparable data

The return on investment far outweighs the time commitment….

I am curious though – how do you use this website? Are you a subscriber to the daily e-mail updates? Do you feel like this website saves you time in researching?  Please give me some feedback, either as a comment below this post, or to the e-mail address below. Constructive criticism is welcomed as well.

Michael Dodds, MAI, CCIM    mdodds@irr.com

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Closings on residential real estate increased by 29% for July compared to 2010, according to preliminary data from the Charleston Trident Association of Realtors.

For the month, 829 homes sold; the median price was $180,000, about 8% lower than the median for July 2010. In 2010, 643 homes sold at a median price of $196,573. The report said the reduction in price is likely because of the increased number of foreclosed properties being sold.

“As expected, the distressed inventory continues to affect our market,” said Rob Woodul, president of the Realtors association. “Year to date, sales volume is slightly ahead of last year. We are encouraged by this slight but steady growth — it means we’re moving slowly in the right direction.”

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South Carolina is the state that is 11th most heavily dependent on its manufacturing sector.

An On Numbers analysis of new federal data indicates that 16.4 percent of SC’s gross state product (GSP) is generated by manufacturing.

The third most dependent state is North Carolina, whose manufacturing sector is responsible for 19.3 percent of its total GSP.

The database at the end of this story has 2010 figures for all 50 states and the District of Columbia. The raw data were originally published by the U.S. Bureau of Economic Analysis.

Gross state product is the total output of goods and services within a given state — in essence, a smaller-scale version of the nation’s gross domestic product. The manufacturing sector generates 11.8 percent of a typical state’s GSP.

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