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Hotel Market Hits Its Peak

LOS ANGELES—At the opening ceremony of ALIS, research experts say that the hotel market is at the peak, but that we should expect to stay at the peak for some time.

By Kelsi Maree Borland | Updated on January 27, 2016
ALIS is held in Downtown Los Angeles. ALIS is held in Downtown Los Angeles.

LOS ANGELES—The hotel market has hit its peak after a phenomenal 2015, according to research experts on the Let the Numbers Speak—Where’s the Peak panel at the opening of ALIS this week. However, that wasn’t bad news. The experts—Arthur Adler, managing director and CEO Americas at JLL; Jan Freitag, SVP at STR; and Mark Woodworth, senior managing director at PKF-HR, a CBRE company—said that this peak is more like a mountain range, and we can expect to stay on top for some time.

“We are at the peak, but we are going to stay at the peak,” Woodworth said on the panel. “The outlook measures are terrific.”

While the sentiment is still strong, it is less bullish than it was even 90 days ago. In an earlier forecast, Freitag’s firm predicted 6.1% revPAR growth in 2016 and 5.8% revPAR growth in 2017. Three months later, at the conference, his prediction dropped to 5.5% revPAR growth in 2016 and 5.6% revPAR growth in 2017. The moderator, W. Edward Walter, president and CEO of Host Hotels & Resorts, questioned if a peak existed. Freitag said that mathematically, there has to be a peak. “The question is how long will we stay at the top?”

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