REITs Continue To Retreat from Hotels in 2012

CHICAGO-Since the summer setback for trusts, private equity and institutions have taken the place of REITs in hotel investment in North and South America. Transactions hit $15.2 billion in 2011, an increase of 24% over 2010. Like many of the property sectors, however, the market should remain flat this year, according to the Jones Lang LaSalle Hotel Investment Outlook Report.

Transaction volume will at least match 2011 levels, as fundamentals such as room rates improve and there’s an abundance of capital, according to Arthur Adler, managing director and CEO of the Americas for JLL Hotels. He said in a statement that the gates are opening for private equity and institutional buyers willing to take calculated risks in primary and secondary markets.