The number of new hotel rooms opened during 2003 declined by 8.3% on a year-to-year basis to 1,331 rooms in Orange County and plunged by 71% to 286 rooms in Los Angeles County, according to the Atlas study. The number of new rooms dropped by 64% to 259 in Riverside County but rose by 15.4% to 245 in San Bernardino County, which Atlas president Alan Reay described as an anomaly.
San Diego County held its position as the state's leader in terms of new hotel supply by adding not only the largest hotel to open in the market in 2003, the 750-room Hyatt Regency in Downtown San Diego, but it also led the state in terms of number of new rooms opened, with 2,402. It marked the second consecutive year in which San Diego has led the state in terms of number of new rooms added. Orange County claimed the second largest hotel project to open in California in 2003 with the 520-room Hyatt Regency in Huntington Beach.
In general, financing is easier to come by for hotels today, according to Reay, who says the availability of capital has changed dramatically from a year to 18 months ago, when only the very best quality properties with 40% to 50% equity investments could secure funding. Lenders are generally more upbeat about the industry's prospects today, Reay says, and higher-end limited hotels in particular are in favor with lenders.
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