The LWHA Q1 2024 Major U.S. Hotel Sales Survey includes 66 single asset sale transactions over $10 million which totaled nearly $2.5 billion and included approximately 10,700 hotel rooms with an average sale price per room of $230,000.

In comparison, the LWHA Q4 2023 Major U.S. Hotel Sales Survey included 86 sales that totaled just over $3.0 billion and included approximately 13,900 hotel rooms with an average sale price per room of $219,000. Comparing Q1 2024 with Q4 2023, the number of trades decreased approximately 23 percent while total dollar volume decreased roughly 18 percent and sale price per room increased 5 percent.

By further comparison, the LWHA Q1 2023 Major U.S. Hotel Sales Survey included 83 single asset sale transactions over $10 million which totaled $3.5 billion and included approximately 12,500 hotel rooms with an average sale price per room of $279,000. Comparing Q1 2024 with Q1 2023, the number of trades decreased approximately 20 percent while total dollar volume decreased 30 percent and sale price per room decreased by roughly 18 percent.

Continued relatively high cost of debt has thus far not eased widened bid/ask spreads and continues to damper U.S. hotel sale investment volume. Additional noteworthy Q1 2024 observations include:

Eight trades or roughly 12 percent of the national quarter total occurred in the State of Florida, followed by seven sales or 11 percent of the national quarter in New York. Six trades or roughly 9 percent of the national quarter total occurred in the State of California and five sales or 8 percent of the national quarter in Arizona. Combined, twenty-six trades or 39 percent of the national quarter total occurred in Florida, New York, California, and Arizona.

Five major hotel sale transactions in the State of Arizona represented a grand total of $768 million or 31 percent of Q1 2024 investment activity.

Three major hotel sale transactions in the State of Massachusetts represented $309 million or 13 percent of Q1 2024 investment activity.

Seven major hotel sale transactions in the State of New York represented $204 million or 8 percent of Q1 2024 investment activity.

Six major hotel sale transactions in the State of California represented $165 million or 7 percent of Q1 2024 investment activity.

Finally, eight major hotel sale transactions in the State of Florida represented $160 million or 7 percent of Q1 2024 investment activity.

Combined, twenty-nine trades in Arizona, Massachusetts, New York, California and Florida represented just over $1.6 billion or 66 percent of Q1 2024 investment activity.

Blackstone sold the 705 room Arizona Biltmore, A Waldorf Astoria Resort in Phoenix, AZ for $705 million, or one million dollars per unit to Henderson Park, a London-based private equity real estate manager. The transaction occurred nearly six years after Blackstone acquired the asset for roughly $400 million from Singaporean sovereign wealth fund GIC, and subsequently renovated the property for more than $150 million.

A joint venture between Certares and Belcourt Capital Partners acquired the 390 room Hilton Boston Back Bay in Boston, MA for $171 million, or $438,000 per unit from Ashford Hospitality Trust Inc.

RLJ Lodging Trust (NYSE: RLJ) purchased the 304 room Wyndham Boston Beacon Hill in Boston, MA for $125 million, or $411,000 per unit from Charles River Plaza Company. RLJ acquired the leased fee position which was previously subject to a ground lease set to expire in 2028.

Douglas Development sold the 234-room AC Hotel by Marriott Washington DC Convention Center in Washington DC for $116.8 million, or $499,000 per key to Apple Hospitality REIT, Inc. (NYSE: APLE).

The former 251 room Loews Minneapolis Hotel sold for $23.5 million or $93,625 per unit which represents a dramatic 65 percent decline from when the property last sold for $65 million in 2014, when it was named the Graves 601 Hotel.

Institutional investment platforms, several of whom are lodging centric, transacted during Q1 2024.

Examples of buyers include Cerates, Henderson Park, Peachtree Hotel Group, Pestana Hotel Group, RLJ Lodging Trust, and Marcus Hotels & Resorts.
Examples of sellers include Apple Hospitality REIT, Inc., Ashford Hospitality Trust, Inc., AVR Realty, Blackstone, Chatham Lodging Trust, Douglas Development, GFI Capital Resources Group, McSam Hotel Group, Highgate, MCR, Noble Investment Group, OTO Development, Starwood Real Estate Income Trust, Inc., Summit Hotel Properties Inc., and Westmont Hospitality Group.

A sale transaction not included in the LWHA Q1 2024 Major U.S. Hotel Sales Survey is Tishman Realty's $500 million sale of the 1,218 room Sheraton Grand Chicago Riverwalk in Chicago, IL. Marriott International (NASDAQ: MAR) acquired the property for $411,000 per room as the seller exercised a put option under the terms of a 2017 legal settlement surrounding MAR's acquisition of Starwood Hotels & Resorts Worldwide, Inc. (NYSE: HOT) in 2016. MAR paid $300 million for the property's leasehold and an additional $200 million to acquire the ground underneath the hotel based upon 2017 appraised values.

Instant Insights /

Hotel Investment Sales Post Quarterly Decline

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