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Hotel Pricing is Up but Volume is Down

While volume has been leaner this year, at about 75% versus 2016, pricing is up and the industry as a whole is somewhat in check in terms of healthy balance sheets and overall supply, according to a recent hotel panel.

Marriott at Legacy Town Center The Marriott at Legacy Town Center was completed in 2001 and includes 49 suites.

PLANO, TX—Hotel volume is down but pricing is up. So said a group of hotel financing experts at the Lodging Conference last week. Moderator Teague Hunter, president of Hunter Hotel Advisors led the discussion regarding $20 million-plus transactions among panelists, Peter Berk, president, PMZ Realty Capital LLC; Ben Brunt, principal and executive vice president, acquisitions and development, Noble Investment Group; Ian McAuley, president, American Hotel Income Properties REIT LP; and Rushi Shah, CEO and principal, Aries/Conlon Capital.

Brunt indicated that volume has been leaner this year, at about 75% versus 2016. Teague indicated that buyers aren’t seeing RevPar growth at this time and expense creep is a factor because of higher construction costs due to increased labor costs. However, Teague said he would argue that the industry is somewhat in check in terms of healthy balance sheets and overall supply.

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Lisa Brown

Lisa Brown

Lisa Brown is an editor for the south and west regions of GlobeSt.com. She has 25-plus years of real estate experience, with a regional PR role at Grubb & Ellis and a national communications position at MMI. Brown also spent 10 years as executive director at NAIOP San Francisco Bay Area chapter, where she led the organization to achieving its first national award honors and recognition on Capitol Hill. She has written extensively on commercial real estate topics and edited numerous pieces on the subject.

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