Hotel deal volumes rocketed 50% to $85 billion in 2015, boosted by a record proportion of cross-border capital and single asset transactions.
In all, 53 hotels sold for over $600,000 per room last year, which reflects the high levels of confidence and capital in the hospitality sector. Activity in 2016 will be more measured, with fewer headline-grabbing 'trophy' properties on the market.
Hotel values will continue to rise, with secondary markets providing the most fertile investment landscape. RevPAR is projected to grow by 4-5% globally this year. Consolidation, single assets, and secondary markets are set to be the big stories in 2016.
Global Anticipated Hotel Transaction Volume
- Global hotel transactions rose nearly 50%, to $85 billion in 2015 – the second-highest year ever.
- We also saw the highest ever volume of single-asset transactions at $47 billion.
- Hotel values will continue to rise in 2016, with the highest value increases expected across secondary markets.
- Cross-border activity will remain strong, and the big targets will be assets in Japan and across Western Europe.
- We expect to see more mergers and acquisitions in 2016.
- Consolidation, single assets, and secondary markets to be the big stories.
