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HVS Releases 2008 Cap Rate and Investment Trends Report

HVS, a global hospitality and hotel services firm, recently announced the publication of the HVS 2008 U.S. Cap Rate and Investment Trends Report.

HVS, a global hospitality and hotel services firm, recently announced the publication of the HVS 2008 U.S. Cap Rate and Investment Trends Report. The report presents an overview of U.S. capitalization rate and investment trends for the hotel sector over the course of calendar year 2007.

“This report not only surveys the hotel investment climate over the past twelve months, but provides insight on where we’re heading,” said HVS founder and President Steve Rushmore. “This is a key resource for industry players who are mindful of the market’s shifts.”

Capitalization is defined as the conversion of income into value and is executed by dividing income by the capitalization rate, or the cap rate. This survey provides an overview of average cap rates and investment trends that occurred during 2007, as well as a forecast of hotel investment parameters over the next three years. Also included in the report is a representative sample of 2007 Major U.S. Sales Transactions broken out by region and the cap rate ranges associated with each.

The following are among the report’s key insights:

  • Capitalization rates are rising as the result of changes in the lending environment over the past few years.
  • The third quarter 2007 had the highest average cap rate in the U.S. at 9.2%
  • The Southern region had the highest average cap rate in the U.S. at 8.4%.
  • Hotels with a sales price of $101 million and above noted the lowest average cap rate at 5.0%.

The HVS 2008 U.S. Cap Rate and Investment Trends Report gives context to the figures with an analysis of the market forces that determine them. The report also examines some of the contingent factors that can lead to different rates for individual properties.

The cost of the 2008 HVS Cap Rate and Investment Trends Report is $300USD. To purchase a copy, please visit our Bookstore page at http://www.hvs.com/Bookstore/ or e-mail Amy Beam at abeam@hvs.com or Erica Feurt at efeurt@hvs.com. To learn more about HVS and how we can put our experience to work for you, please visit http://www.hvs.com/Offices/Dallas.

Information within the HVS 2008 Cap Rate and Investment Trend Report was generated from a database that was developed by HVS to maintain hotel information, sales transactions, market studies, and company research pertaining to the hospitality industry. While HVS acts as conduit for the data within the survey, the firm does not assume responsibility or liability for the data accuracy, usability, confidentiality, or other matters related to this content.