ATLANTA—Atlanta hotel transactions in 2015 will probably break records even as investors in greater Atlanta's lodging industry are reaping record returns. So says the latest research from Hospitality Real Estate Counselors (HREC).

The high-profile hotel deals just keep coming. There's the newly-built 228-room Hilton Garden Inn and Homewood Suites dual-branded hotel in Midtown by Carey Watermark Investors. There's also the upcoming sale of the Downtown Atlanta 128-room Home2 Suites by Hilton to Apple Hospitality REIT when construction is complete in September.

Beyond new development, several Downtown Atlanta hotels are reportedly deep into the sales process including, the 1,200-room Hilton Atlanta, W Atlanta Midtown, W Atlanta Downtown, Twelve Hotel Centennial Park, and the Twelve Hotel Atlantic Station. 2015 could be a truly record breaking year for hotel sales if the ink dries on all these deals.

All told, over 50 hotels transacted in metro Atlanta between March 2014 and March 2015. That's over 25% more than the previous year. The total dollar value of hotels sold in the past 12 months nearly reached $750 million, an 85% increase over the previous year. 

The question is why. Why do so many hotel investors want to grab assets in Atlanta?

“On a macro level, we believe metro Atlanta is a highly desirable market for achieving strong returns from lodging investments,” says Jeffrey S. Brown, senior vice president and East Coast valuation practice leader at HREC. “New large scale commercial developments are underway catalyzing job creation; the tourism infrastructure and leisure demand generators are expanding; and the pace of new housing starts is accelerating.”

HREC offers several highlights, including Mercedes-Benz USA relocating its headquarters to Atlanta this summer, a move that will create about 1,000 jobs.

In Dunwoody, a 2.2-million-square-foot mixed-use project anchored by State Farm Insurance is one of the largest corporate office developments in metro Atlanta's history. State Farm will add 3,000 employees over the next 10 years to the campus, eventually housing about 8,000 workers.

What's more, $1.5 billion in new hospitality products, including new attractions, hotel development and improved services for visitors opened in 2014 and beyond. 

HREC points to SunTrust Park in Cobb County, the future home of the Atlanta Braves baseball team opening in time for the 2017 season and the New Atlanta Stadium for the Falcons football team, also opening in 2017.

“Overall, the metropolitan Atlanta lodging market is thriving,” says Brown. “According to STR, in 2014 metro Atlanta ranked number one for the highest growth rate in hotel occupancy among the top 25 US markets jumping more than 8 percentage points last year, and eclipsing top performing cities including Nashville, Dallas, Houston, Boston, Chicago and New York City.”

From 2009 through 2014, RevPAR for the Atlanta market registered compound annual growth of 7.4%, compared to the national RevPAR compound annual growth of 6.8% over the same period. Looking forward, STR forecasts RevPAR growth of over 5% in 2015.

“Still not a premium MSA on radar screens, but improving dramatically relative to currently preferred coastal gateway US cities, Atlanta is assisted by the ease of access for investors provided by Hartsfield–Jackson Atlanta International Airport,” Brown says. “Average cap rates reflected by Atlanta hotel sales have declined by over 100 basis points in the past 12 months falling to 7.8%. This is a level below the US hotel market as a whole and reflects both the desirability of the Atlanta market from an investor stand point as well as the expectation by buyers of continued improvements in Atlanta hotel's operating performance.”