Corporate rates negotiated for 2012 at Starwood Hotels &
Resorts Worldwide increased by mid-to-high single-digit percentages year over
year, the company reported in its fourth-quarter earnings call.
President and CEO Frits van Paasschen projected business
travel demand at Starwood properties to increase this year and said that, despite
sluggish economic growth in the United States and a potential economic crisis
in Europe, he is "bullish about long-term growth" for the company.
"I have yet to see a big [corporate] customer who
expects to travel less this year," van Paasschen said. He added that
outside of a major global event, 2012 "might surprise us on the upside."
Group rates also increased at Starwood, he said. Group
business booked last year for this year had rates up by the mid-single digit
percentages, and rates for group business in 2013 and 2014 are up by double-digit
percentages, according to van Paasschen.
Overall rate increases at Starwood properties during the
fourth quarter were more modest. Rates at Starwood properties worldwide were up
year over year 3.6 percent on average, including a 3.9 percent increase at
North American properties, 2.5 percent in the Asia/Pacific region and a 9.2
percent increase in Latin America.
Rates in Europe were flat during the quarter. Van Paasschen
said demand in European gateway markets from travelers outside the region would
buoy decreased demand to resorts and other properties typically used more by
European travelers.
"Overall internal demand in Europe has hit something of
a pause as we got into the fourth quarter, but it certainly hasn't dropped off
in a significant way," van Paasschen said.
By brand, Westin, W and Four Points by Sheraton had the
largest rate increases during the quarter, all up more than 4 percent year over
year. Rates were nearly flat at Le Meridien properties.
Global occupancy in the fourth quarter increased by 1.4
percentage points to 66.2 percent and increased across all regions except the
Middle East and Africa.
Starwood's net income for the quarter was $167 million, down
about half from $339 million in the fourth quarter of 2010. Earnings in 2010
included a $73 million legal settlement, which skews the comparison, according
to Starwood.