Jones Lang Upbeat on U.S. Hotel Market - Analyst Blog

According to a report published by Jones Lang LaSalle Incorporated (JLL), a leading real estate investment trust (REIT), hotel sales and acquisitions would increase to the tune of 25% in 2011 in the Americas with investors vying for premium assets. Jones Lang further anticipates that transaction volume would total approximately $13.0 billion in 2011, significantly up from about $10.5 billion in the previous year.

The report cites that a healthy rebound in the U.S. business and leisure travel has attracted a wide array of investors in the hotel industry, including investors from the Middle East. According to Smith Travel Research Inc., an independent research company in the lodging industry, hotel revenue per available room (RevPAR) in the top 25 U.S. markets rose to $76.61 during the first 11 months of 2010 from $71.55 in the year-ago period.

Jones Lang expects REITs to be the dominant buyers in 2011, with private equity groups and institutional investors increasingly joining the party as leverage levels and terms pick up with improving market fundamentals.

In one of the such noteworthy transactions in the industry, Host Hotels & Resorts Inc. (HST), the largest lodging REIT in the U.S., acquired 7 hotels in New Zealand in December 2010 for $143 million. Host Hotels purchased 6 hotels from the affiliates of Tourism Asset Holdings Ltd. – the largest owner of hotels in Australia and New Zealand, while the remaining hotel was acquired from an affiliate of Accor – the world's leading hotel manager and market leader in Europe. The properties with over 1,200 rooms are spread across Auckland, Christchurch, Queenstown and Wellington.

The Jones Lang report provides valuable insights to the hotel industry and envisions the U.S. as one of the most active global markets in 2010. Jones Lang continually invests in industry-leading research to identify emerging trends and anticipate future conditions to respond to the shifting market and business trends of its clients.

This enables the company to develop new investment products and services tailored to the specific investment goals and objectives of its clients, thereby maintaining profitable long-term relationships during challenging market conditions.

Jones Lang provides corporate, financial and investment management services to corporations and other real estate owners, users and investors worldwide. The company operates as a single-source provider of real estate solutions with a broad range of real estate product and services, and an extensive knowledge of domestic and international real estate markets. We maintain our Neutral' rating on Jones Lang, which presently has a Zacks #3 Rank translating into a short-term Hold recommendation.

 
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