Expect a Hotel Dealmaking Deluge This Year
Skift Take
With the two-year anniversary of the pandemic just around the corner, hotel companies are going to be eager to buy and sell around the premise the travel industry is settling into a new normal.
Early Check-In
Editor’s Note: Skift Senior Hospitality Editor Sean O’Neill brings readers exclusive reporting and insights into hotel deals and development, and how those trends are making an impact across the travel industry.Hotel mergers and acquisitions may have been lighter than some would have expected from a downturn like the pandemic, but that’s almost certain to change this year.
Even with the rise of the Omicron variant toward the end of 2021, there is a general sense the worst of the pandemic is behind the hotel industry. Executives homed in on durable revenue streams like leisure travel and business travel from small- and medium-sized companies. That shot all the major companies to back to profitability by year’s end.
Lenders are likely to be less flexible with loan terms, and central governments are unlikely to enact more of the kind of stimulus seen over the last 21 months. That alone could spur an extraordinary level of transactions as owners have to make do with current demand levels to make ends meet. Analysts felt stimulus and lender flexibility was largely holding transaction volume back at the beginning of the pandemic.
Major dealmaking across the hotel industry in the nearly two years since the World Health Organization declared the coronavirus a pandemic has centered mainly on big-ticket properties or smaller brands. Las Vegas was home to several major sales, like the $6.25 billion sale of The Venetian and Sands Expo Center or Blackstone’s $5.6 billion deal to sell the Cosmopolitan.
Now it’s time to recalibrate for what a hotel comp
