News for the Hospitality Executive
Investment in Miami Remains Hot: Statistics Illustrate Fort Lauderdale,
October 2012 - The stage was set in Andy Reed’s Summer 2011 edition of HVS Miami’s quarterly Florida Hotel Trends newsletter, Miami’s Hotel Performance and Values are Set to Heat Up. Now, Reed has again weighed in on the factors contributing to the area’s strong tourism trends and hotel market. Instead of only focusing on the dynamic Miami hotel landscape as most expressed in most current literature, Reed also brings to light investment alternatives that exist in South Florida. That said, given the strength of Miami, a good portion of the article relates to and supports the strength of Miami as a hotel investment destination.
According to Reed, “Statistics show that Miami is not the only hotel market in South Florida illustrating strong performance indicators. Investors could benefit from widening their ‘gateway city myopia’. We would encourage investors to explore alternative South Florida markets such as the Florida Keys, Fort Lauderdale, and West Palm Beach.”
Reed continues, “The South Florida region displays strong tourism growth potential, with Fort Lauderdale set to capture Miami’s overflow, as the area’s international visitation continues to grow and international airlift to Fort Lauderdale continues to expand.” West Palm Beach is also brought to the forefront; noting HVS’ U.S. Hotel Valuation Index (HVI), the city’s hotels lost 77% of their value from 2006 through 2010. Upside exists and a favorable outlook for the area is projected. The most recent HVI states that hotel values in West Palm Beach grew 37% from 2010 to 2011 and will continue to grow by nearly $90,000 per room, from now through 2016.
Reed concludes by advising investors to “anticipate that local hotel operators will achieve strong ADR growth in the [South Florida] region’s primary markets, likely at the expense of occupancy in the mid-term (being displaced to secondary submarkets), until the development financing bottleneck is relieved, and developers are able to bring new hotels on line (already underway in downtown Miami and more so in Miami Beach).”
One can download a complimentary copy of the Fall 2012 Florida Newsletter, titled “Hotel Investment in Miami Still Hot: Opportunities in Fort Lauderdale and Florida Keys Upcoming” by clicking here.
HVS is the world’s leading consulting and services organization focused on the hotel, restaurant, shared ownership, gaming, and leisure industries. Founded in 1980, the company performs more than 2,000 assignments each year for virtually every major industry participant. HVS principals are regarded as the leading professionals in their respective regions of the globe. HVS is client-driven, entrepreneurial, and dedicated to providing the best advice and services in a timely and cost-efficient manner. Through a worldwide network of more than 30 offices and 400 seasoned industry professionals around the world, HVS provides and unparalleled range of complementary services for the hospitality industry.
Leora Halpern Lanz