Big City Hotels Make a Comeback!

Good morning,

Big city hotels make a comeback! NYC hotel rates likely to rise as Airbnb regulations take effect, and HEB reinvents grocery anchored retail. Let’s delve into today’s topics.

📈 Market Update

🏨 Big City Hotels Make a Comeback!

Major US city hotel markets are seeing a resurgence in 2023 after being hit hard by the COVID-19 pandemic. Key metrics like occupancy, average daily rate, and revenue per room are surging back compared to 2022. While demand and occupancy haven't fully recovered to pre-pandemic levels due to more competition from new hotel supply, the top 25 markets are projected to see stronger revenue growth over the next few years compared to smaller cities. Improving weekday and group travel demand, record transient bookings, and more compression nights point to a positive trajectory for big city hotels.

New York City hotel rates likely to rise as Airbnb regulations take effect:
With New York City implementing new regulations on short-term rental platforms like Airbnb, the city's already constrained hotel room supply is likely to get even tighter. Thousands of unlawful short-term rental listings are expected to be removed, while hotel room inventory has not fully rebounded to pre-pandemic levels despite new developments. With occupancy rates already near 90% and room rates up 8% this year, the new Airbnb rules will likely put further upward pressure on hotel pricing power and booking costs in New York City.

⚫️ HEB Reinvents Grocery Anchored Retail

HEB, the largest private company and employer in Texas, has used its regional focus and long-term approach to real estate to become a dominant force in the Texas grocery and retail landscape. By strategically acquiring and holding land, developing stores and strip malls around them, and now building "superstores" that incorporate whole shopping centers, HEB shapes the retail development of Texas cities and towns. After years of preparation, HEB recently expanded into the Dallas-Fort Worth area and continues aggressive growth across Texas, feared by competing grocers. With its deep connection to Texans, HEB represents the state's growth, flavors and trends.

✍️ Further Reading

• California Aims To Speed Up Affordable Housing Development With New Law (CS)

• $33B in Signature Bank Property Loans Up for Sale (GS)

• How Private Is This Community Off the Coast of Connecticut? No Comment (WSJ)

• Cities Need People, People Need Homes. Both Must Wait (BBG)

• In Harsh Environment for Lending, Commercial Real Estate Adapts (RD)

• Brookfield Mulls $2.5 Billion Sale of Atlantis in Bahamas (BBG)

• Elie Schwartz’s Nightingale in Settlement Talks with CrowdStreet Investors (RD)

📊 Chart of The Day