U.S. hotel industry to remain stagnant for 6 to 8 months
The U.S. hotel industry is virtually frozen by the uncertain state of the global economy. As the credit crisis continues to dominate headlines and water-cooler conversations, reality has set in within the hotel industry in the form of an unknown and impossible to predict short term future. While there’s not a lot of optimism for the immediate future, there are some indicators that make the long-term picture a bit brighter. Let’s start with the supply-and-demand equation. Right now, with supply growing and demand declining you have both of these key indicators trending in the wrong directions, as far as lodging performance is concerned. However, if there is one silver lining to all of the financial chaos going on right now, it’s that the supply pipeline is slowing, and will continue to slow. It seems likely that it will take several years to see the same pipeline activity that we saw during the past three years.