Overall trading activity in Canada has been healthy through the first half of 2014 with 64 hotel transactions amounting to approximately $570 million in volume. While below the pace recorded mid-year 2013, we continue to see increased momentum in the market as there is a broad appetite for hotels across all segments by a variety of capital sources. This year’s mid-year transaction report includes our Hotel Pulse, covering significant headlines in the Canadian lodging industry.
YTD 2014 transaction market highlights include:
- There were three portfolio transactions in the first half of the year totaling 1,294 rooms and approximately $53 million in transaction volume (10% of total volume).
- Top transactions included historic properties such as the 477-room Fairmont Empress Hotel in Victoria, British Columbia and the 224-room Radisson Plaza Hotel Saskatchewan in Regina, Saskatchewan.
- Average deal size for lodging transactions was $8.9 million with an active component of the market being limited-service assets. As such, 39% of transaction volume was acquired by private investors YTD 2014.
The majority of hotels transacting this quarter were limited service assets in tertiary markets with Eastern Canada leading the country on volume. The strong pipeline of hotel product on the market which is being met by a diverse buyer group in an overall healthy operating environment will help to drive more activity in the remaining three quarters of 2014.
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