NEW YORK, JULY 14, 2010 – Jones Lang LaSalle Hotels announced today that the volume of United States hotel transactions for the first six months of 2010 eclipsed $2.2 billion, increasing 153 percent from the same period in 2009. This is according to Jones Lang LaSalle Hotels’ proprietary database, which tracks true asset transactions $10 million and above, and excludes note sales, recapitalizations and foreclosures.
“The uptick in investment volume gained considerable momentum in the second quarter of 2010, with transaction volume totaling $1.4 billion, following the $814 million of hotels which traded in the first quarter. Improving lodging fundamentals, along with investors’ more congruous understanding of values and slowly increasing market liquidity, is driving the boost in investment volume,” said Arthur Adler, managing director and CEO-Americas for Jones Lang LaSalle Hotels.
“Portfolio transactions, largely absent in 2009, represented a greatly increased 34 percent of deal volume in the first six months of 2010 as some liquidity returned to the market,” said John Strauss, a managing director for Jones Lang LaSalle Hotels. “Having raised substantial amounts of capital, REITs were the single most acquisitive group in the first half of 2010, accounting for a staggering 51 percent of hotel purchases by volume.”
Investments in 2009 were predominately driven by domestic buyers. In the first half of 2010, however, 10 percent of acquisitions volume stemmed from Asian-based capital sources, evidencing that foreign investors are aggressively pursuing favorably priced high-quality hotel assets in the United States.
“Deal volumes marked a rise for three consecutive quarters and the outlook for hotel transactions is increasingly favorable. For full-year 2010, based on the amount of assets currently on the market, we re-forecast U.S. transaction volume to total between $4 and $4.5 billion, up from our previous forecast of $3.5 billion,” said Adler. This figure excludes the estimated $4 billion eventual closing of the Extended Stay America transaction expected to be completed in 2010.
“Hotel investor sentiment is improving more quickly than anticipated. Strengthening fundamentals across gateway cities and the U.S. as a whole and the high number of equity-rich acquisitive groups such as REITs, private equity funds and off-shore investors are the underlying forces for our increased 2010 transaction volume forecast,” said Adler.
About Jones Lang LaSalle Hotels
Jones Lang LaSalle Hotels, the first and leading global hotel investment services firm, is uniquely positioned to provide the depth and breadth of advice required by hotel investor and operator clients, through a robust and integrated local network. In 2009, Jones Lang LaSalle Hotels provided sale, purchase and financing advice on over $1.6 billion worth of transactions globally. In addition, advisory and valuation services were provided on nearly 800 assignments. The global team comprises over 200 hotel specialists, operating from 36 offices in 19 countries. The firm's advice is supported by a dedicated global research team, which produced 80 publications in 2009 in addition to client research. Jones Lang LaSalle Hotels' services span the hospitality spectrum; from luxury single assets and large portfolios to select service and budget hotels, resorts and pubs. Services include investment sales, mergers and acquisitions, capital raising, valuation and appraisal, asset management, strategic planning, operator selection, management contract negotiation, consulting, industry research and project development services. Jones Lang LaSalle Hotels' clients have access to the resources of its parent company, Jones Lang LaSalle (NYSE: JLL). www.joneslanglasallehotels.com.
Contact: Kristina Paider 312.498.5807 / kristina.paider@am.jll.com
