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US hotel transactions dip
Jones Lang LaSalle Hotels has announced that hotel transactions in the US have dramatically fallen from a record US$45bn (£30.7bn) in 2007 to just US$8.5bn (£5.8bn) last year.
“The first quarter of 2008 was the strongest, with transactions amounting to US$3.2bn (£2.2bn), slowing to US$684m (£467m) in the fourth quarter.
“Despite marking a precipitous fall, transaction volumes in 2008 still exceeded the volumes realised during the trough years of 2001 to 2003,” said Arthur Adler, CEO for the company’s Americas branch.
The most significant decline in hotel investment was in portfolio deals — down 88 per cent to US$3.8bn (£2.6bn) in 2008, while difficulty in obtaining financing caused the average single-asset transaction size to fall by one fifth.
However, investments in hotels by private REITs increased by one third.
Transactions are expected to pick up later this year, with hotel owners suffering from cash flow shortfalls selling their assets.
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