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NEW YORK CITY-Stronger competition and lower demand during a time of negative supply growth are among the factors that have caused full-service, mid-price hotels to rack up most of the delinquent hotel loans within the CMBS pools rated by Standard & Poor’s, according to a new report from the company.

This segment of the market is made up of two groups: those that offer food and beverages (full service) and those that don’t (limited service). Although hotels with loans that are over 60 days past due represent a minuscule 1.4% of the CMBS-rated hotel collateral, full-service facilities account for approximately 55% of that total, according to the report, “CMBS Quarterly Insights: Property Market Trends Parallel Those of the US Economy.”

This sector is burdened with older properties, brands that have lost their market vitality as well as by competition from new limited-service hotels that have opened in the last few years. On top of that, full-service hotels are now having to cope with a slowing economy, which has led many people on smaller travel budgets to stay at limited-service hotels.

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