A wave of hotels is expected to be taken over by banks and other lenders in the coming months, and some hospitality industry players are looking to build up management arms in hopes of operating those properties for their new owners.
Hotel management companies are getting ready to see a wave of foreclosures and new business for them.
Highgate Hotels, Chesapeake Hospitality and Hospitality Ventures Management Group are among the firms ramping up hiring in anticipation of an influx of hotel management contracts by banks and CMBS bondholders.
“We’re spending time with banks and we’re in active dialogue around a number of different opportunities,” Highgate principal Richard Russo said. “We certainly are anticipating that volume to increase.”
Hotel owners have faced an extreme drop in business due to the coronavirus pandemic and various lockdown orders around the world. U.S. hotel occupancy fell from an average of 66% in 2019 to 42% last year, according to STR. The average revenue per available room — the hotel industry’s leading performance indicator — dropped from $86.67 to $43.76 year-over-year.
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