The Coming Horizons for U.S. Hotels

HVS Report – Five Key Takeaways from ALIS Conference The Americas Lodging Investment Summit – By Tanya J. Pierson

Presentations and conversations at the 2015 ALIS conference touched on everything from new brands and supply to how falling oil prices, a rising dollar, and stability in the capital markets are affecting prospects for U.S. hotels.
The Coming Horizons for U.S. Hotels
The U.S. hotel industry stands on solid ground as we enter 2015, and this year’s Americas Lodging Investment Summit (ALIS) engendered confidence that the strong performance should carry on well into next year. Beyond that, however, questions remain, and nearly everyone in attendance was concerned with how long this performance, which has been supported by a variety of factors, will last. Fortunately, several key signs suggest the positive trend is poised to continue well past the near term.
A presentation by John Silvia, PhD, Managing Director and Chief Economist at Wells Fargo, touched on the current industry cycle and revealed that there is no sign of a recession on the horizon, with GDP expected to grow by 2.5% over the next two years. Furthermore, trends of prior cycles indicate that RevPAR growth typically peaks mid-cycle, and such a peak, per Dr. Silvia’s analysis, is something we’ve yet to see in the current cycle. This insight comes as very encouraging news for the industry, and the sentiment echoed throughout the conference.
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