The Hotel Times - March 2008 - (Page 26)

BROKERS UPDATE Overseas tourism into the U.S. was up 10 percent in 2007, compared to 2006, according to CB Richard Ellis Hotels’ Craig Millward. International interest E M I LY H A N N A , A S S O C I AT E E D I TO R CB RICHARD ELLIS HOTELS A s the U.S. dollar plummets and tourism expands to new regions, the lure of other countries draws buyers outside their home countries. Making big sales in 2007 The largest single-asset transaction brokered by Christie + Co. during 2007 was the sale of St David’s Hotel & Spa [above] in Cardiff, Wales, on behalf of Rocco Forte Hotels. Principal Hotels purchased the 132-room hotel from Rocco Forte Hotels for £32.5 million. “After four years of record pricing, the North American hotel market is expected to return to more normal levels. This is a huge window of opportunity for investors to capitalize on current market conditions,” said Craig Millward, director, CB Richard Ellis Hotels EMEA, citing a falling cost of borrowing, increased overseas tourism to the U.S. and solid revenue per available room growth in major cities. Eric Belfrage, v.p. of CB Richard Ellis Hotels The Americas in Columbus, Ohio, said that overseas investors will play a big role in the U.S. market in 2008, focusing mostly on coastal and major metro markets. “With the value of the dollar, it’s like stuff’s on sale,” he said. Additionally, investors are breaking into the booming markets all over Asia. “More entrepreneurial investors are prepared to take on development risk which, for example, is fueling the growth CBRE Hotels, under instruction by Whitehall, sold a portfolio of 46 hotels in France, Belgium and Italy to The Blackstone Group. markets of the [United Arab Emirates], India and China,” Millward said. Large growth in these markets could offset smaller gains that occur in other regions, however. “In the long term, softening yields and further likely cuts in base rates are likely to restore deal activity and potential for capital growth,” Millward said. “Clearly, this is contingent on conditions in the USA not deteriorating any further, which would prolong the recovery. This may, however, be offset by gains elsewhere—for instance, whilst the [International Monetary Fund] is forecasting growth of only 1.5 percent in the USA in 2008, it projects growth of 10 percent in China.” CHRISTIE + CO. Europe’s three largest major portfolio transactions in 2007 Hilton Hotels Corp. Location: Global No. of hotels: 2,896 Sale price (m): US$26,000 Purchaser: The Blackstone Group Seller: Hilton Hotels Corp. 47 Marriott hotels Location: UK No. of hotels: 47 Sale price (m): US$2,160 Purchaser: Quinlan Private/ Igal Ahouvi Group Seller: Royal Bank of Scotland Jurys Inn Group Location: UK No. of hotels: 20 Sale price (m): US$1,557 Purchaser: Quinlan Private Jurys Seller: Doyle Group Source: Christie + Co. 26 The Hotel Times March 2008 www.TheHotelTimes.com http://www.TheHotelTimes.com

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The Hotel Times - March 2008 Business Outlook Editorial Outlook Contents Conference Preview Capital Outlook What's Driving Growth? European Outlook Development Outlook Fractional Outlook Branding Source List Insurance Outlook Brokers Update Brokerage Outlook Lodging's Balancing Act Transactional Facts Lending Outlook Lenders Source List In Closing

The Hotel Times - March 2008

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