The per key valuation of recent hotel transactions are starting to look interesting (for buyers).
We've got a pretty extensive database of hotel transactions over the past several years. We can make that available to interested clients. The chart below provides a look at the price per key trends. We've presented it on a rolling basis and have excluded trophy assets to smooth it out. Included are transactions ranging from economy to upper upscale where prices were disclosed.
The declining values are instructive. While clearly not a positive for the sellers, the industry as a whole may benefit from a more liquid transaction market. Transfers of ownership to buyers with lower costs of capital and better balance sheets is a natural and efficient outcome of a severe demand downturn.
