Global Hospitality News: eHotelier Newsletter

RevPAR Decline Only Tells Part Of The Story; Drop In Hotel Profits Is the Real Concern

Hotel owners and operators across the U.S. are experiencing sharp declines in RevPAR (revenue per available room), but the real concern in 2002 should be the double-digit declines in profitability. As the RevPAR declines of 2001 continued into 2002, The Hospitality Research Group of PKF Consulting (HRG) decided to assess the extent of the declines in profitability and profile some of the changes managers have made to operating expenses.

HRG conducted a study of financial statements from full-service hotels in the U.S. for the periods of January through June in 2001 and 2002. The preliminary results show that the average U.S. full-service hotel suffered a 21.3 percent decline in profits during the first six months of 2002 compared to the same period in 2001. For this study, profits are defined as income before deductions for capital reserves, rent, interest, income taxes, depreciation, and amortization. Further discussion on our preliminary findings follows.

Profits margins have fallen over the past 18 months, but from a historical perspective, they remain healthy. Full-service hotel margins peaked in 2000 at 30.5 percent. In the first half of 2002, they have fallen to 26.2 percent. To place this in a historical perspective, full-service hotels in the U.S. averaged a 21.0 percent profit margin from 1960 through 2001. While hotel revenue has declined, the relatively high profit margin illustrates management’s effectiveness.

The full-service hotels in the HRG sample achieved an average RevPAR of $69.41 during the first half of 2002, compared to $80.25 during the first half of 2001. This represents a decline of 13.5 percent. With rooms revenue comprising 67 percent of total revenue at these full-service hotels, the decline in total hotel revenues was 12.7 percent during this same period.

In response to the double-digit declines in revenue, hotel managers continued to cut expenses following the extensive cuts made during 2001. Operating expenses at the average hotel in the sample were reduced 9.1 percent during the first half of 2002 from the dollars expended in the first half of 2001. In 2001, hotel managers cut their operating expenses 5.2 percent for the entire year in light of the 9.9 percent decline in total revenue. Although some of the declines can be attributed to the decrease in business volume, the study noted declines in some of the traditional “fixed” costs of hotel operations as well.

HRG is projecting full-service hotel RevPAR to increase 9.2 percent in 2003 and another 6.5 percent in 2004. In a separate study, HRG found that managers tend to increase their operating expenses fairly dramatically as the industry recovers. If hotel managers can continue to hold down costs, the hotel industry could see some dramatic improvements in profits over the next two years.

A historical analysis of full-service revenue and profit data from HRG’s Trends in the Hotel Industry database finds that profits tend to react with a greater degree of elasticity compared to movements in revenue. During periods of industry recovery, profit growth has outpaced increases in revenue. Conversely, when industry revenues have declined, profits have dropped an even greater extent.

Full-service hotels have historically spent approximately 45 percent of their operating budgets on labor. Thus, labor is typically the first place a hotel manager looks when it comes to cost reductions. This trend was evident in the first half of 2002, when 37.2 percent of all cost reductions were attributable to a combination of salary/bonus reductions, reduced hours for hourly staff, and some layoffs. On average, the typical hotel in the study sample reduced its payroll and related expenses from $14,290 per available room in the first half of 2001 to $13,243 per available room in the first half of 2002.

While all departments experienced cuts to their labor costs, the lowest percentage reduction in payroll occurred in the marketing department. This was in line with the trend observed in 2001. With such competitive market conditions, the need to maintain sales and marketing personnel continued to be of great importance for hotel management.

Since occupancy for the hotels in the survey sample declined, it follows that guest telephone revenue also would drop. From the first half of 2001 to the first half of 2002, the rooms occupied for the survey sample fell seven percent. At the same time, telephone revenue was off 28.3 percent. This represents the largest percentage decline of any hotel revenue source.

While hotel guests may be avoiding the phone, they don’t appear to be leaving the lounge as quickly. Like all other revenues, full-service beverage (alcohol) revenue dropped from the first half of 2001 to the first half of 2002. However, the 7.4 percent decline in beverage revenue was the lowest percentage decline of any hotel revenue source. The beverage department was the only operating department to have achieved a higher profit margin during this same period.

When analyzing the lodging industry, HRG frequently finds differences in performance among different groups of hotels, be they divided by geography, market orientation, size, or room rate categories. This underscores the notion that each individual hotel is typically driven by local market conditions.

From our preliminary results, we did not observe any significant differences in performance from 2001 to 2002 among the various descriptive categories. It would seem, then, that the extreme and unique factors that caused this industry recession have affected full-service hotels uniformly.

Hotel managers tend to look at RevPAR as an indicator of the fiscal health of their properties. However, for owners and investors, the bottom-line is what really counts. Instead of looking at RevPAR to assess the operator’s effectiveness and ownership’s wealth, HRG believes profit per available room (ProfPAR) is a more accurate indicator. This statistic, in conjunction with profit as a percentage of revenue (profit margin), provides a clearer picture of a hotel’s bottom line and operating performance.

Alexander Feneck is a Research Coordinator with The Hospitality Research Group, the research affiliate of PKF Consulting. Robert Mandelbaum, Director of Research Information Services, assisted with the article.

To purchase a copy of PKF Consulting’s 2002 Mid-Year Trends Survey, please contact Alexander Feneck at (404) 842-1150 Ext. 241 or visit www.hrgonline.com .

In 2002 the total Hotel Development Pipeline declined for the 4thconsecutive year, down 49.7% from the 1998 peak of 530,592 rooms and down 15.1%compared to 2001, Lodging Econometrics (LE) reported in its Guidance Memo to Wall Street analysts and corporate clients.

The Total Development Pipeline at 1,919 Projects and 266,712 Rooms decreased by 35Projects and 5,819 Rooms in 4Q 02, a 2.1% quarter over quarter decline. It is the 12thconsecutive quarterly decline and the 16th out of the last 18.

In the 4th quarter, there were 260 new projects announced while 132 completed projects opened and exited the Pipeline. Reflecting the sluggish economy and the growing threat of war, developers cancelled or postponed 167 projects and another 50 fell backwards into a later stage of development as developers slowed their pace of activity and lengthened their timelines. Together 217, or one of every 9 projects in the 3Q Pipeline, became inactive or had timelines extended by up to a year.

At 4Q 02:

• Rooms Under Construction were down 24.8% for the year and 1.8% for the quarter.

• Starts in the Next 12 Months were down 16.1% for the year and 8.5 % for the quarter.

• Early Planning increased quarter over quarter by 4,461 rooms. This is not of significance, according to LE, because 2,000 rooms were attributed to a single resort planned by Opryl and in suburban Washington, DC, and to 40 projects that fell back from Starts in the Next 12 Months to Early Planning. Year over Year room totals were down 2.5%.

As LE accurately predicted in previous Guidance Memos, 753 hotels opened in 2002with 86,488 rooms, a supply increase of 2% prior to removals. LE forecasts 71,000 new rooms for 03 for a 1.7% increase. If 2003 finishes with the expected demand growth of2.5%, the Supply/Demand imbalances of the last two years will have ended. A more favorable growth trend—of rising demand over declining supply—will begin, lasting for at least 3 – 4 years.

LE foresees a modest lodging recovery ahead followed by a modest development upswing.

Industry occupancy for 02 will once again finish below 60%, and Average Daily Rate will have declined for two years in a row. LE noted that, speaking historically, it is a deep downtrend from which to bounce back, and LE does not expect developers to be outright bullish for awhile.

The early beginnings of the Development turn will likely be seen in late 03 or early 04,and it will start in the Upscale and Limited Service segments. Early activities will begin along the Sunbelt, in the Southwest up to Las Vegas and in the South Atlantic region . For the most part, there should be few new announcements of significant size in CBDs or destination resorts in the early part of the Development recovery. Major market activity from the tail end of the last development cycle is still flowing through the Pipeline.

Nineteen of the Top 25 markets had supply growth in excess of declining demand in 02.Nine more are expected to have supply growth in excess of the 2.5% demand growth benchmark in 03, and 8 more in 04. In the next two years, Orlando, San Diego, Houston, Boston, Detroit, Miami, St. Louis and Seattle are the cities with the most rooms coming on line as a percentage of existing supply.

The Total Pipeline will continue to decline for 2 – 3 more quarters guaranteeing new openings will be well below 2% in the next three years, giving rising demand and rates a much needed window for consolidation so the recovery can begin.

Lodging Econometrics (LE), of Portsmouth, NH, the industry authority for hotel real-estate, monitors 177 Markets and 579 Sub-markets throughout the country, continuously reporting and updating development activity—projects, room counts and percentage growth rates—analyzing absorption three years backward and forecasting supply growth-three years forward. In addition to the Development Pipeline, it reports on Conversion/Re-flaggings, announced Renovation programs, the Census of Open and Operating Hotels, and the Sale and Transfer of all Hotel Real Estate. LE reports can be customized for any company, portfolio or market.

British Hospitality Association (BHA) And Restaurant Association (RA) agreement reached

The Restaurant Association (RA), the dedicated voice of the restaurant industry, has reached an agreement to join forces with the British Hospitality Association (BHA), the national trade association of the hospitality, catering and leisure industry.

With immediate effect, the RA is merging its government lobbying interests into those of the BHA, which will now carry out this work for both associations. Simultaneously, the BHA's Restaurant Panel will be merged into the Restaurant Association's National Committee. Under the new structure the RA will take up two places on the BHA National Executive.

"The BHA has had a wealth of experience and success in lobbying on behalf of the industry and it makes common sense for the two associations to work together much more closely in this area", said Nick Scade, chairman of the Restaurant Association. "The government had also made it clear that it felt that there were too many disparate groups lobbying individually and that they would prefer to be dealing with one body that could speak for the whole hospitality industry".

Because of these new arrangements, and as the RA's office lease at Africa House in Kingsway is about to expire, the two organisations will now share accommodation at BHA's offices located in Queens House, 55/56 Lincoln's Inn Fields, London WC2 3BH. This move will be completed by 8 January 2003.

RA member benefits and publications, patron suppliers, events and competitions will be unaffected by the outcome of this closer co-operation.

About The Restaurant Association - Established in 1967, The Restaurant Association ( www.ragb.co.uk ) is a not-for-profit organisation representing almost 3,000 businesses, including large national high street brands and most well-known independent operators in Great Britain. The Restaurant Association's mission is to inform, educate and represent restaurateurs. It is the only national trade association exclusively dedicated to protecting and promoting the interests of restaurant businesses, irrespective of size, location and ethnic origin.

About the BHA - The BHA ( www.bha-online.org.uk ) is nearly 100 years old and is the national trade association of the hotel, catering and leisure industry, with over 35,000 establishments in membership, employing some 450,000 staff. Its principal objective is to lobby local, regional and national governments, as well as Brussels, on behalf of the industry. It also aims to support its members in the day-to-day operation of their business by means of legal and other advice. It is the lead association in establishing the Best Practice Forum which aims to improve productivity in the industry

Reed Travel Exhibitions (RTE) has urged travel agents who have meetings, incentives, conferences and exhibition clients, to support the industry by attending AIME 2003 in Melbourne, Australia next month.

610 exhibitors from 65 destinations will showcase their products and services at AIME 2003, the southern hemisphere's most significant event for the incentive and business travel industry.

AIME Exhibition Director, David Crooke was quick to ensure exhibitors and potential visitors that travel warnings regarding Asia following the Bali bombing have had no impact on AIME 2003, which will be held on 18 & 19 February.

"AIME is strongly supported by the industry and we have had no cancellations. Bali is still exhibiting at AIME and we are assisting them in whatever way we can," he said.

"Exhibitor numbers are expected to top the 610 mark and in terms of floorspace, we expect the exhibition to be 10% larger than AIME 2002," David Crooke said.

65 destinations will be represented at AIME 2003 including Argentina, Australia, Austria, Bali, Bangkok, Bintan Island, Bora Bora, Borneo, Brunei, California, Cambodia, Canada, Chiangmai, China, Czech Republic, Dubai, Egypt, Fiji, France, French Polynesia, Germany, Hawaii, Hong Kong, Hungary, Iceland, India, Indonesia, Ireland, Italy, Japan, Korea, Laos, Las Vegas, Macau, Malaysia, Mauritius, Melaka, Moscow, Myanmar, Nepal, New Caledonia, New York, New Zealand, Osaka, Pattaya, Phuket, Russia, Sarawak, Selangor, Singapore, South Africa, Spain, Sri Lanka, St Petersberg, Sultanate of Oman, Switzerland, Tahiti, Thailand, Tokyo, Turkey, United Kingdom, the USA, Vietnam, Yokohama and Zimbabwe.

"Our Hosted Buyer program is on track to deliver 330 key decision makers from the United States, Europe, the Middle East, Asia and New Zealand, as well as Australian buyers. In addition we expect another 2200 trade visitors to attend AIME," Mr Crooke said.

"While we can not predict world events, we believe this is a time for the business travel industry to work together to tell the world about the benefits of business travel for meetings and events. There is nothing that can replace personal contact. That's why companies exhibit at AIME and visitors attend AIME," Mr Crooke said.

AIME 2003 is at the Melbourne Exhibition Centre on 18 & 19 February. To register to attend AIME visit the AIME website at www.aime.com.au.

The Dubai Department of Tourism and Commerce Marketing (DTCM) will have its largest ever delegation at International Confex 2003. 20 Dubai-based organisations will exhibit on the DTCM stand (Y230) at International Confex 2003 which is being held from 25 to 27 February 2003 at London's Earls Court. Among the Dubai-based delegates will be a range of MICE industry specialists, including supplier organisations such as hotels and destination management companies.

During the exhibition, the DTCM will be informing visitors about the latest developments including Dubai 2003; and the forthcoming opening of Dubai International Convention Centre and several private sector developments

A major showcase for Dubai as a meetings venue will occur at the end of September 2003 when over 10,000 delegates are expected to visit the emirate for Dubai 2003 to attend the annual meetings of the World Bank and the International Monetary Fund. This will be the first time these important meetings have been held in theMiddle East.

The major structural development for Dubai's MICE market in 2003 will be the opening of the Dubai International Convention Centre (DICC) in March. The emirate's existing 120,000 square metres of varied conference and exhibition space in purpose-built as well as hotel-based venues will expand considerably with the opening of the DICC. It will be the region's largest convention centre, with seating capacity of 6,000 in the main auditorium and 44 breakout rooms. In addition, part of the DICC development will be the 412-room Novotel and 210-room Ibis Hotel which will significantly increase Dubai's hotel capacity.

The completion of numerous other private sector developments will also further expand and enhance Dubai's product proposition to meet an anticipated steep increase for future demand. Important plans for the conference and incentive market include the Grand Hyatt which is due to open in early 2003. The new property will feature 674 rooms, 186 apartments, 4,340 square metres of conference space and state-of-the-art meetings facilities.

A new, purpose-built 9,000 square metre conference centre as part of the future Madinat Jumeirah resort development is also underway. The first phase of which will be the 300-room Mina Al Salam due to open in September 2003.

Incorporating the region's culture and traditions, a unique resort will be the Hatta Heritage Village located in the spectacular Hajar mountains an hour's drive from the city. With the opening scheduled for 2003, the resort will cater for small incentive groups and meetings.

For incentive organisers, summer 2003 will see the completion of a highly anticipated development in Dubai; the first Formula One standard race track in the United Arab Emirates. The Dubai Autodrome will consist of a five kilometre circuit designed to F1 specifications complete with grandstand, hospitality suites, retail shops and a F1-themed refreshment outlet.

Year-round business and leisure travel to Dubai is growing constantly from the UK and Ireland. In 2001 the destination had 15 per cent more British and Irish hotel guests than the year before, totalling 355,542 and similar growth rates are expected for 2002, once the figures for the whole year become available. Long-term worldwide visitor targets are equally ambitious - 15 million visitors by 2010, compared to 3.6 million visitors last year.

(BUSINESS WIRE)--Jan. 20, 2003--Choice Hotels International, Inc., (NYSE:CHH) will conduct a conference call on Thursday, February 13, 2003 at 9 a.m. Eastern time to discuss the company's fourth quarter and year-end 2002 earnings. The company will release its earnings after the close of trading on the New York Stock Exchange on Wednesday, February 12.

The call-in number to listen to the call is 1-888-273-9890. The conference call also will be Webcast simultaneously via the company's Web site, www.choicehotels.com. Interested investors and other parties wishing to access the call on the Web should go to the Web site, click on the Corporate Information link and then the Investor Info link. The Investor Info page will feature a conference call microphone icon to access the call.

The audio of the call will be archived and available on www.choicehotels.com for those unable to listen to the call on February 13. It also will be archived and available for replay until March 6 by calling 1-800-475-6701. The access code for the replay is: 671783.

Choice Hotels International is one of the world's largest lodging franchisors, marketing more than 5,000 hotels open or under development in 46 countries under the Comfort Inn, Comfort Suites, Quality, Clarion, Sleep Inn, Econo Lodge, MainStay Suites and Rodeway Inn brand names. For more information on Choice, visit the company's web site at www.choicehotels.com.

Choice Hotels, Choice Hotels International, Comfort Inn, Comfort Suites, Quality, Clarion, Sleep Inn, Econo Lodge, MainStay Suites, Rodeway Inn, and The Power of Being There. Go are proprietary trademarks and service marks of Choice Hotels International.

Shandong Province, one of China's east coast economic powerhouses, received 96.71 million tourists last year, a figure that exceeds its total population, said a local tourism official.

Zhu Limin, deputy head of the Shandong provincial tourism administration, said domestic tourists accounted for 95.73 million, up 18 percent from 2001, and foreign tourists totaled 976,800, up 17.88 percent. The tourism industry generated revenue of 61.08 billion yuan (7.36 billion US dollars) in 2002, up 23 percent year-on-year and equivalent to 5.75 percent of the province's gross domestic product (GDP), according to Zhu.

Of the total earnings, domestic tourism contributed 57.15 billion yuan (6.89 billion US dollars) to the total, while foreign tourists generated 473 million US dollars. The tourism official attributed the province's booming tourism industry to Shandong's development of tourism resources and its construction of new scenic sites. The province now has more than 700 scenic sites.

In the meantime, Shandong has made active efforts to explore additional markets for new tourist sources. In addition to hosting a number of cultural activities in collaboration with organizations such as the United Nations Educational and Scientific and Cultural Organization (UNESCO), the province has organized promotional missions overseas.

Cambodia is gearing up for the official opening of the 22nd ASEAN Tourism Forum (ATF) this Friday and major hotels in the capital are bracing themselves for the unprecedented influx of visitors.

The kingdom is staking hopes that the annual regional event will go a long towards changing previous negative perceptions of its image, due to its past political legacy.

"People still have a very negative view of Cambodia – that it's not safe and backward with absolutely no infrastructure – but actually it's a lot safer than other parts of the region. We have had no major upheavals since 1997-8," said Edwin Bucher, general manager of InterContinental Phnom Penh.

Bucher said he hoped the ATF would help to dispel that negative image, as overseas buyers got their first taste of what the country had to offer, in particular, Phnom Penh, where hotels were struggling to compete against the increasingly more popular destination Siem Reap, home to the famous Khmer temples of the Angkor Empire.

"The Open sky policy has also meant that tourists can now fly direct to Siem Reap and bypass Phnom Penh, which has had an effect on business," said Bucher.

In an attempt to boost occupancy rates, the InterContinental Phnom Penh recently changed its strategy, focusing on group tours and lowering its rates to remain competitive.

"We really went after that (group) market which we would never have done before and we've adjusted our rates accordingly," said Bucher.

In addition to its new focus, the hotel is putting its support behind the recently formed Phnom Penh Hotel Association's, new website which will be launched next month – linking together Phnom Penh's four- and five-star hotels.

"One has to remember that very few hotels here have had advertising or marketing exposure internationally, so the website is an important step in that process," said Bucher.

Coinciding with 'Visit Cambodia Year 2003', the 22nd ATF will play host to some 1,500 delegates and invited guests.

Prime Minister Hun Sen will preside over the official ceremony with a 'Party By the Mekong' hosted by Hotel Cambodiana and TTG Asia Media.

21 January 2002: Accor has announced the strategic addition of a second Novotel in Japan, with the rebranding of The Hotel Yokohama to TheYokohama Novotel. Accor is scheduled to assume management of the hotel (fondly referred to as "The Yoko") in July and will rebrand it to a Novotel once a significant refurbishment program is completed by the owners in September.

The centrally located 166-room hotel is situated opposite Yamashita Park, facing directly onto Yokohama Harbour and the historic Port of Yokohama.

Occupying a site where the former US Consulate was located, the hotel Is owned by K.K.The Hotel Yokohama.

"Yokohama, as Japan's second largest city and major international port was a natural choice for our next Novotel in Japan," said Mr David Baffsky, Chairman of Accor Asia Pacific. "It is the right time to concentrate on growth in Japan. The country is an important part of Accor's expansion and visibility and our next objective will be to bring Novotel to Tokyo.

strong international brand recognition, helping to attract more overseas visitors, particularly from North Asia. From just one hotel twelve months ago, Accor now has seven hotels in Japan, with plans to announce more in the near future." Close to the city's main business district, shopping, entertainment

And nightlife, The Yokohama Novotel is perfectly positioned for both the corporate and leisure markets. It provides easy access to the ultra

Modern new waterfront development of Minato Mirai 21 with office, convention, museum, dining and shopping facilities including the Yokohama Art Museum, Landmark Tower, Queens Square shopping malls, the Cosmo World amusement park, a pier and a waterfront park. The hotel is also next to bustling Chinatown.

As part of the rebranding, the hotel will undergo a renovation and refurbishment program. After refurbishment is complete in September, The Yokohama Novotel will feature an extensive range of business, leisure and function facilities including two restaurants, a street-level café, bar, beauty salon, conference facilities, undercover parking and a new chapel and wedding facilities. The Yokohama Novotel joins a network of more than 370 Novotel hotels and resorts in more than 61 countries. It will be the second Novotel in Japan, joining the Novotel Koshien Osaka West, as well as other Accor hotels - Sofitel Tokyo, Sofitel The Cypress Nagoya, Mercure Narita (opening mid-2003), Formule 1 Numazu and Formule 1 Isesaki.

With 147,000 associates in 140 countries, Accor is the European leader and one of the world's largest groups in travel, tourism and corporate services, with two major international activities:

* hotels: 3,800 hotels (425,000 rooms) in 90 countries, casinos, travel agencies, and restaurants;

* services to corporate clients and public institutions: each day, 13 million people in 32 countries use a broad range of services (food vouchers, people care and services, incentive, loyalty programs, events) engineered and managed by Accor.

Starwood Makes Its Entry Into Vietnam With the Sheraton Saigon Hotel & Towers Slated to Open in May 2003

(BUSINESS WIRE)--Starwood Hotels & Resorts Worldwide, Inc. (NYSE:HOT) announces its entry into Vietnam with the opening of the Sheraton Saigon Hotel & Towers in May 2003.

The opening of the Sheraton Saigon Hotel & Towers in Ho Chi Minh City will usher in a new level of upscale world-class hotel accommodations in Vietnam.

The Sheraton Saigon Hotel & Towers and Executive Residences are strategically located in the heart of Ho Chi Minh City's vibrant business and entertainment district on Dong Khoi, the city's primary thoroughfare. The 23-story Sheraton Saigon Hotel & Towers offers unequalled business, recreation, retail, residential and entertainment options. Appealing to cutting-edge corporate and leisure travelers, the hotel will introduce the highest standard of personalized service, at the most prestigious address in the city. The Sheraton Saigon Hotel & Towers' opening is a timely event as it coincides with Vietnam's growing popularity and the subsequent demand for upscale hotel accommodations.

Featuring 382 deluxe rooms and suites, with an average room size of 430 square feet, the Sheraton Saigon Hotel & Towers will boast floor-to-ceiling marble bathrooms, separate bath and invigorating massage style Visy shower with overhead and mid-level jets.

Meetings and gala events in Ho Chi Minh City are also set to grow to a larger and grander scale as the Sheraton Saigon Hotel & Towers will provide the city with its largest grand ballroom (8,169 square feet) featuring state-of-the-art audio visual options and equipment. With more than 19,000 square feet of comprehensive meeting and function space on the second and third floors, the Sheraton Saigon Hotel & Towers is set to assume the mantle of the leading "events" hotel in Ho Chi Minh City.

Housed within the grand lobby of the hotel are the finest upscale designer boutiques including Versace, Armani and Gucci. Within the lobby, shoppers and guests can unwind at "The Lounge" to the soothing tones of the resident pianist in elegant surroundings.

The Sheraton Saigon Hotel & Towers, Executive Residences opened in February 2002. This residential development of 92 units, consisting of one, two and three bedroom Residences, is offered as part of the Sheraton Saigon Hotel & Towers. The integration of a world-class hotel facility with luxury residential living provides the perfect blend for the modern city dweller in this emerging city.

The hotel will mix Asian and International cuisine to create a fusion unique to the Far East with contemporary dining options. The rooftop wine bar and nightspot, "Level 23", will enable guests to dance the night away to live entertainment, enjoy an outstanding wine selection and view panoramic sights of the city.

Designed by Hirsch Bedner Associates, the world's first and foremost hospitality and interior design firm, the Sheraton Saigon Hotel & Towers promises to delight the most seasoned traveler, offering a myriad of options with unparalleled fitness facilities, including tennis, squash and an international Day Spa and Health Club.

Starwood Hotels & Resorts Worldwide, Inc. is one of the leading hotel and leisure companies in the world with 750 properties in more than 80 countries and 110,000 employees at its owned and managed properties. With internationally renowned brands, Starwood is a fully integrated owner, operator and franchiser of hotels and resorts including: St. Regis, The Luxury Collection, Sheraton, Westin, Four Points by Sheraton, W brands, as well as Starwood Vacation Ownership, Inc., one of the premier developers and operators of high quality vacation interval ownership resorts. For more information, please visit www.starwood.com .

Newsletter - January 23, 2003