The Southeast is the hottest part of the country for sales of single-asset hotel properties, according to the most recent data from Real Capital Analytics (RCA).
Over the 12-month period ending in September of this year, sales in the Southeast region represented more than a quarter of U.S. single-asset transactions in the hotel sector. Acquisition volume in the Southeast grew to $7 billion for the year ending this past September — a 55% increase compared to the prior 12 months.
That’s important news for the hospitality sector because, according to recent numbers from the Mortgage Bankers Association, hotel-property transactions fell by 20% year over year in third-quarter 2019. And, unlike the other regions of the country, sales prices are rising in the Southeast. The average price per unit in the Southeast rose 49% during that same period, RCA reported, whereas prices in the West, Southwest and Northeast either declined or stayed flat.
Year to date, the two largest hotel deals in the U.S. have been in the Southeast — more specifically, in Florida. The Waldorf Astoria Boca Raton was sold this past June to MSD Partners for $875 million, while 1 Hotel South Beach in Miami switched ownership to Host Hotels and Resorts this past February for $610 million.
Developers have joined investors in keying on the region. In the 12-month period ending this past September, four of the top 10 hotel-construction markets in the nation were in the Southeast: Nashville, Miami, Orlando and Atlanta.
