[BISNOW] Investors Want To Buy Into Boston’s Improving Hotel Market, But Deals Are Still Scarce
As the weather warms, Boston is drawing not only flocks of tourists but also a host of hotel investors.
Boston was ranked the fifth-most-attractive hotel investment market in the nation for 2024, behind New York City, Miami, San Francisco and Charleston, South Carolina, according to CBRE’s Global Hotel Investor Intentions Survey. However, high interest rates and a lack of supply have held the city’s investment sales market from reaching its potential.
Hotel researchers and brokers tell Bisnow that although the macroeconomic environment is slowing sales and construction for now, it may benefit Boston’s competitiveness in the long term.
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BU SHA’s associate professor and director of the real estate program, Kaushik Vardharajan, said that although investment has slowed in the market, there are still bright spots because bigger players are confident in the city.
“These are institutional investors who are extremely sharp,” Vardharajan said. “You’re seeing them coming in and buy ahead of the curve in Boston. So that’s key and it gives me a greater level of comfort.”
While leisure demand has normalized from its revenge travel trend of 2022, business and convention travel have grown, with both of Boston’s major convention centers seeing strong advanced bookings.