Inside Track: Bankruptcy Court To Review Delta Exit Plan

Delta Air Lines last week said its creditors showed "overwhelming support" for its reorganization plan. Delta said unofficial results of a vote showed more than 95 percent "of ballots cast and claims value voting were in favor of the plan." The next milestone comes Wednesday, when the federal bankruptcy court is scheduled to review and perhaps confirm the plan. The carrier is seeking a Chapter 11 exit within the next month. Meanwhile, Delta said creditors also voted "in similar numbers" to favor regional subsidiary Comair's reorganization plan.

Zoom Preparing June JFK-Gatwick Takeoff
Canada-based Zoom Airlines said it would launch service between London Gatwick and New York JFK on June 21. Zoom is casting itself as a "low-fares, full-service" alternative to entrenched transatlantic carriers. The carrier said, "Zoom will operate an EasyJet-style booking service with flexible one-way fares and the New York flights will offer economy and premium economy services with designated seating, meals service and plenty of frills." The carrier for three years has operated flights between Canada and the United Kingdom.

Air Analyst: Domestic Demand Deteriorating
Although American, Continental and Southwest—the three major domestic carriers that have announced earnings for the first quarter of 2007—posted profits in the first leg of the year, one airline analyst cited evidence that domestic demand is declining. J.P. Morgan airline analyst Jamie Baker said, "Let's not stick our heads in the sand.There is a growing body of evidence that domestic demand is deteriorating, further calling into question the likelihood of 2008 results anywhere near the level implied by consensus." Baker said, "International trends remain robust," but noted that strong international performance "is unlikely to carry airlines to the finish line currently implied by consensus."Baker said "$50 crude or healthy consolidation could potentially keep the equity dream alive, though we're not modeling for either."

Marriott Lowers Revenue Growth Expectations
Marriott International softened its revenue projections for the year in its first-quarter earnings report last week, stirring a buzz about a potential slowdown in the barreling hotel industry. The company reported North American revenue per available room was up 5.2 percent for the quarter compared with last year, slightly less than its earlier growth predictions. In addition, Marriott dropped its forecast RevPAR growth for 2007 from the 7 percent to 9 percent range to the 6 percent to 8 percent range. The company, however, said the numbers do not represent an overall industry trend. "We are not calling a macro change in the RevPAR growth rate in the industry," Marriott CFO Arne Sorensen told investors late last week. "When we look at the first-quarter results, we do not see that as an indication of a significant shift down."

Real Estate Firm To Buy Extended Stay Hotels
Private real estate giant The Lightstone Group has agreed to acquire Extended Stay Hotels for $8 billion from The Blackstone Group in a deal it expects to close in about two months. Pending closure, the Lakewood, N.J.-based firm, one of the largest privately held real estate companies in the United States, would then control the largest domestic midprice extended stay portfolio. Extended Stay Hotels operates five brands—Extended Stay Deluxe, Extended Stay America, Homestead Studio Suites, StudioPlus and Crossland—that comprise 683 properties and 76,000 rooms in the United States and Canada.

Hyatt Luxury Brand To Debut In London, New York
Global Hyatt Corp. will open the first hotel under its new luxury brand Andaz later this year in London, with properties slated to follow in New York and several other international gateway cities. Hyatt is renovating the Great Eastern Hotel in London and will rebrand it following the completion of that work, which is expected by September. The company plans eventually to open another Andaz on recently purchased property at Fifth Ave. and 41st St. in midtown Manhattan.

Little Rock Selects Clear For Registered Traveler Lanes
Registered Traveler provider Verified Identity Pass, which operates the only functioning RT program in the United States, added Little Rock Municipal Airport to its roster of airports providing its expedited security screening lanes. The company last week said enrollment for its Clear program would begin within 30 days "once a contract has been executed," with lanes to follow. As part of its Little Rock program, the provider entered into a co-marketing partnership with the airport's valet provider, Valet Solutions.