Hospitality Investing News - Southeast February 2025

While December 2024 was the best month of the year for all hotels, the US hotel industry is facing a challenging environment. Although 2024 saw a 1.8% increase in RevPAR, driven by ADR growth, when adjusted for inflation, hotels have declined compared to 2019. This lag between ADR growth and inflation, coupled with rising labor costs, is squeezing hotel profits. Further complicating the situation are the impacts of unpredictable weather events like wildfires and hurricanes, which disrupt travel and damage properties. The LA wildfires, for example, have already led to significant demand declines in the affected areas. Despite these challenges, the hotel industry shows signs of resilience, with no significant increase in loan delinquencies and a continued trend of high-end hotel transactions