How U.S. Hotels Are Faring | Forbes.com

The holidays may be over, but for the U.S. hotel and motel industry, the good times could continue into 2014.

Privately held hotels and motels saw their third year of solid sales and profit growth, according to recent data from Sageworks, a financial information company, and net profit margins have turned nicely positive in recent years as tourism and business travel continue to improve from the depths of the recession.

Meanwhile, the hotel industry is seeing some turnover in investors. Private equity firm Blackstone Group has announced or executed initial public offerings for three of its hotel chains within the last six months, and sale and purchase transaction volume is growing. Indeed, industry consultants STR Analytics expect hotel-industry transaction activity to top $18 billion in 2014.

Looking at private-company financial statements filed during the 12 months ended Dec. 4, hotels and motels (NAICS 721110) generated nearly 8 percent annual growth, on average, according to Sageworks’ data. That’s in line with sales growth rates in 2012 and 2011 and above the 5-year average growth rate of about 4 percent. The growth rate is also noteworthy because privately held companies across all industries have seen slower sales growth over the last 12 months than in 2012.

“Hotels are consistently growing,” said Sageworks analyst Brad Schaefer. “In our data, we have seen some industries, like the retail sector, take a hit in sales growth but so far, hotel industry sales are still growing healthily and haven’t shown signs of stopping yet.”