The Pacific Northwest Hospitality Market
The Pacific Northwest region remains strong and attractive for hotel buyers. While some metro locations (I’m looking at you, Portland and Seattle!) continue to suffer from the poor reputation, which only strengthened throughout the pandemic, secondary and tertiary markets in Oregon and Washington are robust, and there is high demand for well-priced properties. Montana and Idaho metro locations are booming. Anything within reach of a National Park or other outdoor tourist draw generates good interest, and secondary/tertiary markets in those states continue to support their pricing via solid cash flow.
Joseph Kennedy, Certified Hotel Broker and President of Crystal Investment Property, asserts, “Cash flow is KING, and regardless of the overall stability of our economy and relatively moderate outlook climatologically, today’s sector is all about covering debt and looking at future asset appreciation.”
Fall 2023 Industry Outlook From Hospitality Asset Managers
The Hospitality Asset Managers Association conducted its Fall 2023 Industry Outlook Survey, which included the opinions of nearly 80 hotel asset managers, focusing on budgetary predictions and industry concerns.
- Concerns that arose during COVID-19, such as supply chain delays, have subsided.
- 61% of respondents predict RevPAR increases in 2023 compared to pre-pandemic 2019.
- The top three concerns for hotel asset managers are wage increases, demand, and labor availability.
- Nearly two-thirds (63.64%) of participants believe the country will avoid a recession over the next two years.
The Travel Industry Is Seeing The End Of Pent-Up Travel Demand
Post-pandemic travel showed a marked rise in hospitality demand after months of quarantine and COVID-19 restrictions. Here we are, four and a half years later, and travel trends are beginning to show a decline in what has been called “revenge travel.” Although the decline has yet to be felt in the United States, a report by Morning Consult shows an 11% drop in travel intentions in France and a 6% drop in Germany since 2022. Although prices remain bullish, it is believed that consumers in advanced economies, particularly the U.S., will likely moderate their spending plans in the face of an uncertain economic environment.
Consumers Are Splurging On Experiences Again
According to the latest 5WPR survey, one of the largest independently-owned P.R. Firms in the U.S., consumers are splurging on travel experiences again after years of saving. Censuswide conducted the research with 1,003 respondents aged 18+ across the USA, giving some worthwhile insights into the latest travel and tourism spending habits.
- 51% of American consumers now tend to splurge on travel and experiences, up from 38% in 2022.
- There has been a 13% increase in consumer interest in splurging on travel and experiences since Q4 2022.
- Word-of-mouth is the top channel for discovering travel destinations (46%) and researching trips (40%).
- Social media platforms like YouTube (41%), Instagram (31%), and TikTok (29%) are also crucial for travel discovery.
- YouTube (37%) remains the favored platform for research, followed by Tourism Board Websites (28%) and Travel Publications (26%).
- Six months to one year in advance is the ideal timeframe for consumers to start researching a destination.
- 54% of consumers spend more than four hours, up to eight, researching a destination before their trip.
- Inflation has impacted 78% of respondents’ choices of travel destinations, with 43% significantly affected.
- Hospitality Asset Managers Association (HAMA) Releases Fall 2023 Conference Industry Outlook Survey Results
- Is the party over? New data suggests revenge travel may be ending soon
- Hotel Online: Survey Reveals Consumers Are Splurging on Travel and Experiences Again After Years of Saving
- Photo by Liz Lauren