Drop in Hotel Volume Seen as a Return to Normal

Reay: “The days of just buying a hotel and sitting back and letting the market push up appreciation are probably behind us.”

IRVINE, CA—The decline in dollar volume for hotel sales in 2016 is not really that significant since we were coming off a record-breaking year in 2015 and the decrease was anticipated, Atlas Hospitality’s president Alan Reay tells GlobeSt.com. According to the company’s 2016 YE California Hotel Sales Survey, the decline in total dollar volume that we saw in its mid-year report carried through to the end of the year.

California hotel sales volume was down over 54% for the year, while individual sales transactions were down 18%. These figures compare to a decline in hotel sales volume of 30% and individual transactions down 43% for the US overall (as reported by Real Capital Analytics). We spoke with Reay about the takeaways from the report and what they indicate about the hotel sector this year.