Namely, more hotels were selling outside of the top 25 markets especially in New York, San Francisco and Miami, part of a general move from the downtown urban hotels to the suburban hotel sales. There were also fewer hotel sales in the luxury category, he said.

Also, according to Hannah Smith, STR consultant, portfolio transactions were a key factor in the decline, as properties sold within a portfolio represented 21% of all of the hotels sold last year.

On the other hand even though there was a decline in the price per room, STR also noted that there was a big increase in capital expenditures right after the sales transaction. “That shows you that a lot of the hotels that were sold were purchased with the idea of undergoing a major renovation,” Rael said. Specifically, the amount of additional capital infused into hotels following acquisition rose significantly to $37,000. This was the highest level of additional capital per room since 2012 and the second highest since 2000.

Other key findings from the Hotel Transaction Almanac 2018 include:

• The Alohilani Resort Waikiki Beach (formerly the Pacific Beach Hotel) in Hawaii garnered the highest acquisition price at $515 million with Commerz Real Investment as the buyer. Overall, four of the top 10 most expensive transactions tracked by STR in 2017 were made in Hawaii.
• The Hotel Yountville in Yountville, California, generated the highest price per room transaction at $1,206,250 with Ashford Hospitality Prime as the buyer.
• Overall, there were five properties sold with a price per room of at least $1 million.
• The New York City market was once again well represented on the list of transactions with 10 hotels sold at a price per room of more than $400,000.
• Independent hotels continue to sell at a higher price per room, representing almost half of the top 30 transactions tracked by STR in 2017.
• REITs and foreign investors were the primary purchases of the top transactions.