Hotel Capitalization Rates Bottom Out - By Suzanne Mellen
2007-01-25
ReduHotel capitalization rates, defined in for purposes of this discussion as the ratio of a hotel's net income to its sales price, have bottomed out, as rates of return remain at record low levels and NOI upside has begun to subside.
This article updates hotel capitalization and discount data that was presented in a previous article on hotel capitalization ratesced interest rates and lower equity yield requirements have had a substantial positive impact on hotel values. Additional value gains are now being fueled by more aggressive deal underwriting, as discussed in this article.
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