Unable to attend the 2021 NYU Conference? Check out hotelAVE Takeaways on NYU Conference!
hotelAVE Takeaway #1: GREEN SHOOTS DRIVING CONFIDENCE
STR forecasting nominal RevPAR recovery one year earlier – now
2023. Return of international travel, expected business and strong group
pace bodes well for 2022.
hotelAVE Takeaway #2: UNCERTAINTY IN UNDERWRITING RECOVERY AND INFLATION IMPACT
While leisure rates should hold, adding lower rated corporate and group
occupancy will reduce overall ADR. Can we continue to push rate to cover
inflation impact on wages and cost of goods? What are you underwriting?
hotelAVE Takeaway #3: TOO MUCH MONEY CHASING TOO FEW DEALS
Still a seller’s market. Select serve assets dominate at 56% of total
transaction volume (vs. 39% 2019 per HWE) with over 50% of transactions
concentrated in Florida, Texas and California. REITS remixing investment
allocations towards the “certainty” of leisure driven assets versus the
uncertain recovery of corporate and group driven assets. Is urban big box
the contrarian/value play?
hotelAVE Takeaway #4:DEBT MARKETS FOLLOWING TRANSACTION MARKETS
Lender confidence improving, taking cues from transaction markets. Banks
and insurance companies are coming back to the market as well as some
select CMBS issuance. Sources indicated some differentiation in pricing –
larger loans terms generally stronger than smaller loan terms and leading
markets (i.e. recovered/nearly recovered) preferred over lagging markets.
hotelAVE Takeaway #5: CAPITAL REINVESTMENT REQUIREMENTS MAY DRIVE MORE SALES
There is a capital void for upcoming renovation cycles and inflation is also
affecting renovation costs. Brands are supportive with modified
requirements, for now.
hotelAVE asset management and advisory teams are assisting owners and lenders
navigate through the ever changing COVID era landscape. Our projected shift in
segmentation in 2022 will demand different sales, marketing and revenue strategies
and tactics.
Contact us to discuss how we can help as an asset manager, receiver or advisor.
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