A CENTURY 21 Commercial Publication

Vol. II, Issue 12

Greetings

I am pleased to present you with The Real Estate Investment Journal®, a Century 21 electronic newsletter publication!  Delivered to commercial investors, consumers and sellers of investment property on a bi-monthly basis, this electronic newsletter is designed to give you the commercial real estate information that is important to you.  In each issue, you will find practical tips and articles related to investing in, selling, leasing or owning commercial properties, as well as the latest news on trends in the commercial real estate industry.  I hope that you enjoy this issue of The Real Estate Investment Journal®.  If I can be of any assistance, please do not hesitate to contact me.

Feature

Hotel Construction Mounts A Strong Comeback

By Ryan Chittum
Provided by RealEstateJournal.com

After several years of restraint, hotel building is coming back.

With travel soaring as the economy recovered from recession and worries about terrorism and war, developers mostly shunned building hotels for other types of property even as the industry has accumulated record profits. Much of available capital has flowed to residential buildings, particularly condos. Rising construction costs have also kept a lid on hotel construction.

PricewaterhouseCoopers projects hotel-room starts will jump 45% to 120,000 in 2006 after a relatively anemic 82,100 last year. The 2006 number is higher than any since 2000 and well above the 20-year average of 96,000 starts a year.

Hotel construction will outpace all other commercial sectors this year, predicts Robert Murray, vice president for economic affairs at McGraw-Hill Construction,

a unit of McGraw-Hill Cos. of New York. With the housing boom showing signs of pulling back, hotels keep churning out profits as travelers fill up more rooms, allowing hotels to increase room rates.

The past three years have been the best for the hotel business in more than two decades. Revenue per available room jumped 8.4% last year, the biggest increase since 1984, according to Smith Travel Research of Hendersonville, Tenn. Bjorn Hanson, a partner in PricewaterhouseCoopers lodging practice, projects the key industry measure will increase 7.6% this year.

And more rooms are in the pipeline. Lodging Econometrics, a Portsmouth, N.H., lodging-analysis firm, says its measure of hotels under construction or in the planning stages is at its highest point since 2000. As of February, there were more than 428,000 rooms in the pipeline, compared with about 322,000 a year earlier.
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