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Truist Says 2025 Will Look a Lot Like 2024


Skift Take

Truist projects 2025 will closely resemble 2024’s hotel performance—with modest RevPAR growth, potential M&A, and continued cost pressures for REITs—while favoring Wyndham and Ryman Hospitality.

The markets surged and treasury yields fell with the news being everything from a tamer-than-expected CPI report to an agreement on a cease-fire in the Middle East. Whatever the combination, the DJIA jumped 703 points, Nasdaq was up 467, the S&P 500 rose 107 points, and the 10-year treasury yield dropped .14 to 4.05%. Lodging stocks were higher.

Morgan Stanley said they see 2025 as a cycle extension, not a new cycle, leading to sluggish overall growth but pockets of acceleration due to the new administration. They downgraded Choice Hotels and Sunstone Hotels to Underweight from Equal Weight while favoring Travel + Leisure. They remain overweight at HiltonMarriott, and Wyndham. The downgrade of SHO and CHH is after the rally in both stocks, as they see a more negative risk/reward from here.

Truist also said 2025 is shaping up like 2024 but warned to look out for unintended consequences. They are projecting RevPAR growth of 1%-3% for U.S. midscale and higher-end hotels but said 2%-4% could be possible. They see group finishing at or above the high end of the range, individual business at least at the mid-point, and leisure at the low end. On the international front, they see tough competition for Europe this summer, and China is getting a boost from stimulus. They are not ruling out possible Private Equity and/or company-to-company M&A, along with the possibility of more companies announcing sizable cost-cutting measures. Not including the tough hurricane comp in 4Q (CHH and WH), Truist believes 2025 will look like 2024, and that is a good thing. Wyndham is their favorite. They expect hotel REITs to continue to struggle to see flat same-store margins as cost growth is greater than revenue growth. Ryman Hospitality is their favorite.

On the timeshare side, Truist seems to be fascinated with Marriott VacationsVAC had a tough last couple of years, with Truist saying they stand out as a major underperformer. They said when looking at stocks with the greatest potential for upside in 2025, VAC stands out. They are not calling it their top idea; it is more like an idea stock with significant upside potential should management be able to execute and avoid operational pitfalls. Their conservative scenario has VAC as at least a 15% total return. A more realistic scenario is that EBITDA will grow at a 2024-2026 CAGR of 8% per year and a greater than 30% return with a price target of $108.

STR reported U.S. lodging data for the week ended January 11. U.S. hotel RevPAR was down -13.2% year over year, with rates down -5.9% and occupancy down -7.7%. Group RevPAR was down -33%.

MRA Group is moving forward with the groundbreaking of a Marriott Residence Inn, marking a significant development for the Chestnut Run Innovation & Science Park campus in Wilmington, Delaware. The new hotel, developed in partnership with Gulf Creek Hotels, will include food service, a full-service bar, meeting spaces, and outdoor patio areas. The construction of the hotel will be supported by D2 Capital Advisors, with financing provided by a group of lenders including WSFS BankNuveen Green Capital, and Sustainable Energy Utility Incorporated.

The Morongo Band of Mission IndiansMarnell Hospitality, and Tharaldson Hospitality have broken ground on a 200-room hotel alongside the Morongo Casino Resort & Spa in Cabazon, California. The dual-branded Hampton Inn and Home2 Suites hotel is scheduled to open in early 2026. The four-story property will include a resort-style pool and spa, a bar/lounge, dining, fitness center, two large meeting/conference rooms, and ample lobby and lounge areas.

Continental Hospitality Group has acquired the 124-key Hyatt Centric Old Town Alexandria located in Alexandria, VirginiaCHG will complete select property improvements in 2H 2025.

A real estate development company has bought two oceanfront parcels at Ko Olina Resort in Kapolei, Hawaii, and plans to move forward with long-delayed plans to develop a $2 billion Atlantis Resort on one of the properties, according to bizjournals.comNewage Ko Olina, an affiliate of Kam Sang Co. Inc., purchased the 43.55 acres fronting two of Ko Olina’s lagoons for a total of about $216 million from China Oceanwide. The total includes a $177 million purchase price, $25 million in unpaid real property taxes and association fees, and $15 million in back fees to The Resort GroupKo Olina Resort’s master developer. As part of the deal, Kam Sang Co. has agreed to develop the Atlantis Resort, which has long been planned for the 26.3-acre lagoon-front parcel. The company is also looking at other hotel and resort brands such as RegentMandarin OrientalSt. RegisWaldorf Astoria, and Fairmont for a 17.3-acre parcel. The Resort Group told Pacific Business News that the development timeline for building both hotels concurrently is about five years and will cost about $2.5 billion—$2 billion to build the Atlantis Resort, which would be the first in the United StatesAtlantis Resorts, which is owned by Kerzner International, has a 25-year hotel management agreement for the property. Atlantis will have about 500 hotel rooms and 500 vacation-stay or condominium units, while the second hotel will have about 250 hotel rooms and 250 vacation units for a total of 1,500 keys. Newage Ko Olina and Kam Sang Co. were represented by Powell & AucelloCBRE represented the seller.

Wyndham Hotels & Resorts and Reside announced the opening of two new Washington, D.C. properties under the “Reside, a Wyndham Residence” line. The two new properties, Reside Navy Yard and Reside NoMa, mark the latest milestone in the 10-year tie-up between Wyndham and ResideReside Navy Yard offers a mix of studio apartments and two-bedroom townhouses across 81 units. Reside NoMa offers 67 units. Both properties will have a fitness center.

Sonesta International Hotels Corporation announced the opening of Sonesta Essential Baton Rouge. The 77-room, upper-midscale hotel is located in Baton Rouge, Louisiana, and is owned by Rohit Sangwan.

CoralTree Hospitality announced the addition of Black Desert Resort and Red Mountain Resort in southwest Utah to its growing management portfolio. The two properties, owned by Reef Capital Partners, are located in Greater Zion. The new Black Desert Resort, developed by Reef, is a 600-acre resort and entertainment complex spanning three communities: IvinsSanta Clara, and St. George. The first phase of the development features nearly 800 rooms, including hotel rooms, private homes, a 45,000-square-foot convention center, a spa, an infinity pool, and cabanas, as well as seven restaurants and bars. The centerpiece of the first phase of development is the 19-hole Black Desert Resort Golf Course. The resort is currently open and will celebrate its grand opening later this year.

The long-term vision for the Black Desert Resort calls for additional rooms and residences, a pedestrian-only boardwalk with over 80,000 square feet of restaurant and retail space, a pickleball complex, and a water park. Guests and residents will also enjoy more than six miles of public hiking trails throughout more than 200 acres of preserved land. Red Mountain Resort is located adjacent to the iconic Snow Canyon State Park and provides access to all of the outdoor adventures found throughout Greater Zion. The 130-room resort offers daily morning hikes, healthy dining, the Sagestone Spa, a fitness and recreation center, and an unlimited list of daily adventure and fitness offerings.

Pier Sixty-Six, in Fort Lauderdale, Florida, has reopened following a major renovation. The new and improved Pier Sixty-Six has 325 rooms and suites. The resort will have 12 restaurants, three pools, including one for adults, Zenova Spa & Wellness (to open in March), 40,000 square feet of indoor and outdoor event space, and a 164-slip marina. The property is owned by Tavistock and is managed by CoralTree Hospitality. The original 17-story landmark tower with the rotating lounge was renovated and has 110 rooms. A new adjacent hotel tower, with 189 rooms, was added, as were 26 one-bedroom villas built on the harbor. Pier Sixty-Six has residences for sale.

Kasa announced the opening of Kasa Little Italy, the company‘s second property in San Diego, California. The property features an indoor and outdoor fitness center, yoga and Pilates studios, a sauna, a cold plunge, a massage room, an open-air deck with cozy gathering spaces, and, early this year, an outdoor pool is slated to open.

Ripple Hospitality Partners announced its official launch. Ripple is a hospitality investment and development firm dedicated to creating exceptional hospitality assets that generate long-term value. Founded by Andy Stormont and Clayton RandleRipple Hospitality Partners leverages decades of expertise in hospitality investments, private equity, and structured finance to deliver superior returns through market cycles. Ripple is headquartered in Atlanta, Georgia.

Driftwood Capital secured a total of $207 million in senior construction financing and C-PACE financing for its signature Westin Cocoa Beach Resort & Spa on Florida’s Space Coast. The $420 million, 502-key resort is scheduled to open in 2027. City National Bank of Florida provided $70 million in construction financing at a competitive interest rate, with Bayview PACE, a division of Silver Hill Funding, LLC, providing $137 million in C-PACE financing. Driftwood also secured a $50 million credit facility from Amerant Bank at the holding company/fund level (Driftwood Florida Space Coast Portfolio). The Westin Cocoa Beach Resort & Spa will feature 11 food and beverage venues, a spa, a surfing wave pool, multiple swimming pools, tennis and pickleball courts, a fitness center, multiple retail options, and a multi-story parking garage for up to about 800 vehicles. The resort will offer 72,000 square feet of open-air venues complemented by 51,500 square feet of indoor space.

MMI Dining Systems rebranded as Zest Culinary Services, signaling a step forward in aligning its identity with its mission to deliver vibrant, innovative, and personalized dining experiences. Zest Culinary Services is part of MMI Hospitality Group.

Hamilton Princess & Beach Club announced the $15 million renovation of its Bermudiana Wing. The project began on November 18, 2024, to upgrade all 113 rooms in this extension of the property, with completion expected in early Spring 2025. Following construction, six one-bedroom suites will be available that can be converted into two-bedroom suites.

Blue Diamond Resorts unveiled the $32 million transformation of Royalton Punta Cana, An Autograph Collection All-Inclusive Resort & Casino, and its neighboring Hideaway at Royalton Punta Cana, An Autograph Collection All-Inclusive Resort & Casino - Adults OnlyRoyalton Punta Cana offers redesigned rooms and suites and upgraded common areas, including the lobby, Diamond Club lounge, and a Convention Center. Hideaway at Royalton Punta Cana reopened with newly enhanced rooms and serene public spaces. Guests will find a renewed culinary experience across the properties, with notable renovations across the food and beverage outlets.

Europe Highlights

Four Seasons will operate The Park Gstaad Hotel in Switzerland once the property reopens following extensive renovations, which are already underway. Owned by Dona Bertarelli, the property is undergoing a full-scale refurbishment led by Squircle Capital. The property is anticipated to reopen as The Park Gstaad, A Four Seasons Hotel in time for the 2026-2027 winter season.

Forrest Hotels has taken over the Campanile Hotel building and the North Rotunda in Glasgow and is turning them into a new hotel and an event venue. The group has chosen Glasgow for the first Prize-branded hotel in the UK and is set to begin work to transform the old hotel. The new hotel will have 163 bedrooms and a bar and restaurant space. The group also plans to turn the North Rotunda into a multi-event and leisure venue, including weddings. Plans are to open the new facilities in 2026 before the Commonwealth Games in the city.

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