With transaction activity on the rise, the positive outlook exhibited in the recent Hotel Investors Gauge, a quarterly survey that serves to measure the attitudes of lenders, developers, investors and others involved in hotel real estate deals, is not surprising.
Based on the results shown in the pie chart below, more than half of the respondents expect hotel cash flows to re-stabilize by 2014.
A key factor to the recovery is the diminishing ;supply growth expected in 2011 and 2012. However, most respondents believe supply growth will return quickly. Nearly 18% of those surveyed expect supply to return to a normal level in 2013, while more than 41% anticipate room supply growth to rebound to a more typical level by 2014. Historically, the average annual growth in supply has been 1.9%.
Click here to access the full survey results. (Paid subscription to the Hotel Investment Barometer required.)