How to Determine a Hotel’s Feasibility and Land Value in 60 Seconds
Several times a month, I get a call that usually goes like this:
By Stephen Rushmore, Hotel Valuation Expert and Founder of HVS, Hotel Valuation Software
Opinion Articles
Understanding the Current State of the U.S. Hotel Transaction Market
The hotel transaction market continues to face significant headwinds. Investors are still concerned about the prohibitive cost of debt, and with the chances of a summer rate cut from the Fed becoming slimmer, expensive debt may remain for the foreseeable future. Additional challenges to getting deals done are the bid-ask spread, rising operational costs, and extensive change-of-ownership property improvement plans (PIPs). As ownership groups consider placing their hotel assets on the market, they should consider how these headwinds are affecting buyer underwriting so that they have realistic pricing expectations.
By Eric Guerrero and Josh Williams
Streamline Hotel Budgeting: Why Hoteliers Should Adopt Budgeting Software Now
Effective financial management is paramount for the success of a hotel business. One of the critical aspects of financial management is budgeting, a process that traditionally involves significant time, effort, and coordination among various departments within a hotel organization. However, with the advent and adoption of modern budgeting technology, hoteliers can streamline their annual financial budgeting processes and dedicate fewer resources toward building an accurate budget.
By Jason Q. Freed, Hospitality Data Evangelist, Otelier
5 Reasons to Celebrate Your Night Auditor on May 18
On May 18, Otelier is once again asking hotel leaders to come together to shine a spotlight on the dedicated overnight crews that keep our establishments running seamlessly through the night. We have several ways you can recognize their hard work this year, including nominating exceptional team members for 2024 Night Auditor of the Year.
By Jason Q. Freed, Hospitality Data Evangelist, Otelier
Luxury is growing, and so are we
Luxury hospitality epitomizes excellence in every facet of its operation, striving for unparalleled superiority in design aesthetics, offering incomparably attentive service, presenting the most exquisite culinary delights, and providing an exceptionally rejuvenating spa experience.
By Alex Sogno, CEO, Global Asset Solutions
A New Approach to Estimate the Return on the Equity in the Mortgage-Equity Valuation Technique
In my previous newsletters, I describe the virtues of utilizing the mortgage-equity technique when valuing hotels and other types of income properties. This newsletter will explain how to determine the return on the equity component which is based more on the transaction market rather than the financial market. My approach will probably surprise you.
By Stephen Rushmore, Hotel Valuation Expert and Founder of HVS, Hotel Valuation Software
Telecom Compliance in Hotels
A Certificate of Occupancy (C.O.) is a vital requirement prior to opening your hotel after a new build/renovation (without it you’re subject to massive, compounding fines!). Because of the necessity of this certification, you’ll want to work it in to your construction plans from the very beginning to avoid any project delays.
By Clarisa James, Business Development Manager, Kings III Emergency Communications
LW Hospitality Advisors (LWHA) Q4 2023 Select Major U.S. Hotel Sales Survey
At the dawn of 2024, a U.S presidential election looms amidst numerous geopolitical challenges including two major ongoing wars in Europe and the Middle East which threaten global economic growth. The good news is, thus far it appears the U.S. economy has avoided recession with many now perceiving continued growth, albeit subdued. Inflation has cooled, the economy continues to add jobs, interest rates appear to have peaked and are anticipated to gradually decline for the next two years. Furthermore, a roaring stock market continues to fuel American consumer expenditures resulting in strong demand for travel including lodging.
By Daniel Lesser, President & CEO, LW Hospitality Advisors LLC (LWHA)
Downtown Baltimore Is Poised for Comeback
According to STR, average hotel rates in the Baltimore Central Business District through year-to-date September 2023 have surpassed 2019 levels by nearly $18, caused by stable demand levels and the impact of inflation. Occupancy has yet to rebound to pre-pandemic levels, but the return-to-office efforts and investment in leisure demand generators should support the ongoing recovery. Although the city is currently in a transitional phase, financial commitments and plans from stakeholders, as described below, should position Baltimore for a resurgence as a destination to live and visit.
By Caroline Dioso, Project Manager, Washington, D.C, HVS
Econ 101 Drives Hotel Value - CBRE Market Perspective
Statistically, this challenging period in the hotel market is summarized below:
By Robert J. Webster, Vice Chairman, President CBRE Hotels Investment Properties, CBRE Hotels
Notable Resort Developments in Telluride
Over the past decade, Telluride has gained popularity as a secluded resort destination during both the summer and winter months. However, when compared to other mountain resort destinations throughout the region, Telluride has few luxury-resort lodging options.
By Katy Black and Ryan Mark
Shining in Today’s New Normal: Key Takeaways from CHICOS 2023
The 2023 edition of the Caribbean Hotel Investment Conference & Operations Summit (CHICOS) brought over 300 attendees to the Westin Beach Resort & Spa St. Thomas, USVI, for several days of networking and industry insights from key stakeholders in the region. This article provides k
By Kristina M. D'Amico, Senior Vice President - Director, Caribbean Region, Miami, HVS
Q3 2023 Major U.S. Hotel Sales Survey
Notwithstanding a persistent jittery economic environment and rising global geopolitical concerns, market conditions in the U.S. appear simultaneously shaky and resilient. National lodging sector metrics, particularly average room rates and RevPAR, continue to achieve exceptional results as demand for travel and lodging remains robust. Although overall leisure patronage is trailing off from pandemic highs, due in part to Americans opting for international travel, domestic corporate individual and group meeting business continues to rebound to pre Covid-19 levels. Additionally, inbound international travel to the U.S. continues to recover.
By Daniel Lesser, President & CEO, LW Hospitality Advisors LLC (LWHA)
Staying Within Budget in 2024: The eProcurement Advantage
Hoteliers know that guest experiences drive revenue. In recent years, leading hoteliers have responded to the pressure to leverage data to deliver more personalised, streamlined stays for their guests. But while hoteliers have been busy moving towards digital customer-facing solutions, they haven’t put as much energy into back-of-house (BOH) transformation. Accenture reports that 95 percent of travel companies are only focused on digital transformation in some parts of their business, but not all of them.
By Johannes Vocke, Chief Financial Officer, FutureLog AG
Navigating the hotel transaction market: Not all assets are created equal
While commercial real estate as a whole continues to navigate uncertainty, the hotel property market is experiencing a unique set of challenges and opportunities. Hotel owners and operators currently face a significant divergence in hotel operations performance across different locations and sectors. Meanwhile, potential buyers and sellers are grappling with how to accurately value hotel properties and manage rising debt costs and interest rates, leading to a complex and depressed deal market for hospitality properties.
By Ryan McAndrew, Real Estate Senior Analyst, Senior Manager, RSM US LLP, RSM
What Hoteliers Need to Know about Rising Insurance Costs: Leave No Stone Unturned
Just as ensuring hotel safety requires leaving no asset or process unexamined, the quest for affordable property coverage requires casting a wide net.
By Terri Stanganelli, Senior Director of Risk Management/Telecommunications, Meyer Jabara
The Shifting Landscape of Boutique Hotel Investment
The shifting landscape of boutique hotel investments has sparked discussions about the challenges and opportunities that lie ahead. Amidst these conversations, BLLA’s industry experts have expressed optimism and resilience, showcasing the adaptability and creativity that define the boutique hotel sector.
By Ariela Goharik Kiradjian, Partner & COO, BLLA
Navigating the Current Hospitality Real Estate Investment Market: 14 Tips for Investors
The theme for the Future Hospitality Summit (FHS) 2023, taking place from 25-27 September at Hilton Abu Dhabi Yas Island in Abu Dhabi, is ‘Focus on investment’. The conference programme will comprise several content tracks under the main theme, including Investment, Operating Models, Innovation, the Future of Tourism and ESG. In the lead up to the event we asked several industry partners about their focus on investment in 2023 and beyond.
By Elie Milky, Vice President Development, Middle East, Cyprus, Greece, and Pakistan, Radisson Hotel Group
Focus on Investment and Innovation within Abu Dhabi’s Leisure and Entertainment Industry
The theme for the Future Hospitality Summit (FHS) 2023, taking place from 25-27 September at Hilton Abu Dhabi Yas Island in Abu Dhabi, is ‘Focus on investment’. The conference programme will comprise several content tracks under the main theme, including Investment, Operating Models, Innovation, the Future of Tourism and ESG. In the lead up to the event we asked several industry partners about their focus on investment in 2023 and beyond.
By Taghrid Alsaeed, Executive Director – Group Communications and Destination Marketing, The Bench
Inside the Decline of Hotel Transactions in Q2
Defying the expectations of many, the U.S economy has demonstrated resilience driven in part by a solid employment report with stronger than expected wage growth during June, along with continued healthy levels of consumer spending. With this said, the U.S. economy has been slowed by the Federal Reserve’s aggressive drive to tame inflation through a series of interest rate hikes that began early last year. Although trending downward, with inflation remaining above its two percent target, the Federal Reserve is on track to raise interest rates again this month and mull another hike as soon as September. Despite elevated inflation, which is now easing, and ongoing fears of impending economic recession, unemployment rates remain low, and Americans continue to spend money on goods, services, and experiences.
By Daniel Lesser, President & CEO, LW Hospitality Advisors LLC (LWHA)