CBRE Projects U.S. RevPAR Growth of 2% This Year

The DJIA plunged 749 points on Friday, while the Nasdaq was down 438, the S&P 500 fell 104 points, and the 10-year treasury yield was down .08 to 4.42%. Lodging stocks were lower. The two earnings names, SHO and RHP, were down -6% and -5%, respectively, while ABNB gave back -6% of their recent gains.

Ryman Hospitality reported a rare miss, attributing the shortfall to a leisure slowdown in the last two weeks of December. They also gave lower-than-expected guidance. 2025 will include renovations at Opryland, Texan, and the Palms. The Gaylord Pacific Resort and Convention Center will have its grand opening on May 15. The $1.3 billion Chula Vista, California property will be the largest hotel on the West Coast at 1,600 rooms and the sixth hotel under the Gaylord Hotels brand.

Sunstone Hotels reported a better-than-expected 4Q with in-line guidance for 2025. They bought back 100,000 shares in 4Q for $900,000. SHO said the Andaz Miami Beach is expected to reopen in the next few weeks after significant renovations, which is expected to add nearly four points of growth.

CBRE issued a forecast that RevPAR will continue to grow steadily in 2025 as urban locations continue to outperform due to improved group and business travel and continued recovery of inbound international travel. CBRE forecasts a 2.0% increase in RevPAR growth in 2025, with occupancy improving by 23 bps and ADR increasing by 1.6%. This projected growth indicates the continued recovery of the lodging industry, with RevPAR expected to be 16.6% higher in 2025 compared with pre-pandemic levels in 2019.  CBRE’s baseline forecast includes a 2.4% GDP growth rate and average inflation of 2.5% for 2025.  Given the typically strong correlation between GDP and RevPAR growth, the relative strength of the economy will directly impact the lodging industry’s performance. 

JLL's U.S. Select-Service and Extended-Stay Hotel Outlook 2025 report is now live, providing an assessment of recent market trends, the sector's investment appeal, and evaluating its potential to remain a strong and attractive investment option in the coming years. Key findings include: Select-service hotels have demonstrated robust growth and resilience, with record-breaking RevPAR, near-full demand recovery, superior operational efficiency compared to full-service hotels and inflation-resistant profitability. The proliferation of brands and strategic moves such as M&A and conversions indicate a dynamic and competitive landscape, with major hotel groups adapting to market conditions and seeking net unit growth. The sector’s consistently higher yields and lower yield volatility compared to other main property sectors continue to attract diverse investors, from owner-operations to HNWIs and private equity firms. While portfolio transactions have seen a temporary decline due to high interest rates, this trend is expected to reverse, given recent reductions in rates and credit spreads. The lending landscape remains favorable, with a growing diversity of lenders showing confidence in the sector driven by a small check size and debt market clarity. 

According to CoStar's January 2025 data, the U.S. hotel industry reported a slight decrease in performance from the previous month. The occupancy rate in January 2025 stood at 52.5%, marking a 1.0% increase from January 2024. The ADR was $151.20, up by 3.4% from the previous year, while the REVPAR was $79.42, a 4.5% year-on-year increase. Among the top 25 Markets, Tampa saw the highest occupancy level at 79.9%, a significant 17.6% increase largely due to the impacts of Hurricanes Helene and Milton. In contrast, St. Louis and Minneapolis reported the lowest monthly occupancy rates at 42.9% and 43.1%, respectively.

Spark by Hilton is now open in Santa Nella, California. The Spark by Hilton Santa Nella offers a fitness center, outdoor pool, and free parking.

Tryon Riverfront Inn is now open in New Bern, North Carolina. The new 73-room boutique hotel is part of the Tapestry Collection by Hilton.

Newport, Kentucky's $1 billion Ovation development is now open, including a Homewood Suites by Hilton Newport Cincinnati. Corporex is the master developer of the property, while Commonwealth Hotels will oversee and manage hotel operations.

The skyline has changed in Rapid City, South Dakota, over the last couple of years since the Block 5 project began. As part of the $85 million project, the Hyatt Place Rapid City Downtown hotel would be the first hotel built in the downtown area in more than a decade and is making good progress.

Centurion Real Estate Partners announced the acquisition of the Mandarin Oriental Residences, Beverly Hills. Developed by SHVO, this property is Mandarin Oriental's first residential-only project on the U.S. West Coast.

Pendry is considering opening its first Nashville location in SomeraRoad's yet-to-be-built 30-story tower in the Gulch. The brand is considering opening The Pendry Nashville Hotel & Residences by Montage Hotels and Resorts in Paseo South Gulch project, one of the city’s largest developments. The tower would be the second ground-up building in the $1 billion development. According to documents, the hotel and condo tower will include 146 condo units and 180 hotel rooms. The hotel development is estimated to cost $364 million. Project details also include a restaurant, lobby bar/café, and 13,400 square feet of meeting and event space, including a ballroom, library, conference facilities, and more. Outdoor amenities include a hotel pool and bar lounge, as well as an exclusive condo pool. The 30^thfloor would serve as an exclusive amenity level for condo residents with a whiskey and billiards space, chef’s kitchen and outdoor lounge. The tower was scheduled to break ground by the end of 2024 and is expected to deliver in early 2027. Investment firm Trestle Studios and construction company JE Dunn are also partners in the project. 

Palace Modern, a new and different boutique hotel, is open in Santa Fe, New Mexico. The 16-room property is built on the footprint of the 1880s-era Palace Hotel. Palace Modern houses longstanding tenants and coming soon is a Mexican restaurant and tequila bar on the ground floor and a tasting room on its expansive second-floor terrace. The Palace Modern portfolio also includes two historic adobe residences offering additional options for weddings, groups, and multi-gen travelers looking for full or partial buyouts of the hotel and residences. 

Located at the intersection of SoHo, Hudson Square and New York City's Tribeca neighborhoods, the SoHo 54 Hotel is a boutique hotel with 160 guestrooms and suites. The 19-story property offers a restaurant space, with a lobby-level bar and lounge, and an outdoor rooftop terrace. Manga Hotels has converted the property to a TOOR Hotel, making it the first U.S. property under the TOOR Hotel Collection.

Lender Corten Real Estate Partners is threatening to show Ron Burkle the door at Soho House & Co.'s swanky The Line LA hotel in Koreatown, The Real Deal reported. RECP Sydell Wilshire, a Delaware shell company tied to the billionaire investor, defaulted on a $100 million loan backed by the 384-key hotel on Wilshire Boulevard last month.

Waldorf Astoria Costa Rica Punta Cacique, a luxury oceanfront resort, is now accepting reservations for stays beginning May 1, 2024. The resort is one of Hilton's most anticipated openings in the CALA, and is slated to join Hilton's portfolio of more than 280 hotels across the region this spring.

Personnel Move

EOS Hospitality has appointed Patrick Berwald as Senior Vice President of Food and Beverage. Patrick joins EOS Hospitality from Pyramid Global Hospitality, where he most recently served as Senior Vice President of Food and Beverage.

Europe Highlights

Hilton announced the upcoming expansion of its Athens portfolio, confirming franchise agreements with Aluma Greece IKE to open three new properties. The Adia AlA Aluma Athens, part of the Curio Collection by Hilton, is slated to open in 2025. Slated to open in 2026 is The Skylark Aluma Athens, under the Tapestry Collection by Hilton. The Anise Aluma Athens, also part of the Tapestry Collection by Hilton, will add 99 rooms to Hilton's portfolio. This new development will introduce the Tapestry brand to Evripidou Street, offering a restaurant, rooftop par and pool, a meeting room and a gym. 

CapMan Hotels II, a fund managed by CapMan Real Estate, has signed an agreement to acquire a portfolio of hotels from Midstar Fastigheter AB. The portfolio comprises 28 hotel properties, offering a total of 4,709 rooms. By 2027, through targeted value-enhancing initiatives, the capacity will be increased to 4,887 rooms.