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Hotels Bouncing Back From Tough Times With U.S. Lodging Outlook

Green Street recently expanded our suite of products to include comprehensive Sector Outlook reports and market-level data covering the lodging industry. Clients are now able to access unique insights and data solutions covering the top 50 markets in the U.S. and top 30 markets in Europe. The hospitality industry employs 1 in every 10 individuals in the U.S. Given the industry’s vast profile, the significant level of capital allocated to the space, and variety of constituents (e.g., investors, operators, partner brands), we are now offering insights and data that dives deeper than ever before into the sector.

If you want to learn more about this new offering you can keep reading or watch the video below to see our Head of U.S. Lodging, Chris Darling, speak about the product himself. 

Having emerged from a period of unprecedented distress catalyzed by the Covid-19 pandemic, U.S. lodging fundamentals are on firm footing with several tailwinds that suggest upside may lie ahead. Green Street expects that the industry’s next leg of growth will be driven by improving group and international inbound travel, supplemented by a favorable supply backdrop. From a valuation standpoint, hotel asset values have held up far better in a higher interest rate backdrop than most other commercial real estate property sectors. While other sectors have experienced a ~15-30% decline in asset values since recent peak pricing in early ’22, lodging asset values have only fallen by ~5% (see our Commercial Property Pricing Index).

Green Street’s new U.S. Lodging Outlook will provide insights on the above and far more. Each report will provide:

  1. Overviews and Sector 101s for Lodging
  2. Key Takeaways for Trending Insights
  3. Nominal Cap Rate Time Series
  4. Commercial Property Price Indices (CPPIs)
  5. Current Market IRRs and Build Ups
  6. The Primary Supply Landscape for the Lodging Sector
  7. Promising and Worrisome Ares of Investment
  8. The Green Street Methodology for Lodging

Adopting this Green Street data into your business and investment strategy will help empower your decisions by leveraging insight, not just information, to act on cutting-edge trends impacting the lodging space. Due to its tight correlation with macroeconomic swings, the U.S. Lodging sector is often “first to react” to changing investment and/or operating conditions, which often provides valuable insight as it relates to other commercial property sectors. In an economy where superior data and due diligence lead to the best possible business outcomes, finding the right data to lean on can make all the difference.

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Looking to the remainder of 2024, we envision an uneven growth trajectory as certain markets are still emerging from an elongated post-Covid recovery, while others are experiencing a reversion to normalized demand levels. While the industry, in aggregate, is on an upward path, identifying the best-positioned markets can help drive optimal investment outcomes. While there’s plenty to be optimistic about concerning the trajectory of the lodging industry, it’s important to take a sober

approach towards factors negatively impacting the sector such rising operating costs and an uncertain backdrop for consumer spending.

Make sure you aren’t just keeping up but acting on cutting edge data and insights. Green Street is waiting to transform your CRE data for better decision-making with just a click of a button – what are you waiting for?

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