Hotels Lure Investors as Lodging Surpasses U.S. Offices, Retail
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Palm trees grow below the Royal Palm Crowne Plaza in Miami Beach. Photographer: Joe Raedle/Getty Images)
Hotel purchases are increasing faster than deals for office buildings, shopping centers or any other type of U.S. commercial property as rising occupancies and room rates boost the lodging industry.
A rebound in business and leisure travel is helping the U.S. lodging industry recover after last year’s recession sent occupancies to a 30-year low. Hotels can boost rates quickly to take advantage of economic growth, while tenants at offices and retail properties tend to sign multiyear leases.
“Hotels have already absorbed the downturn,” said Richard Jones, executive vice president of acquisitions and operations at Atlanta-based developer Portman Holdings LLC. “It’s not as evident what exactly the impact of this downturn is going to be for other commercial real estate.”
