According to Jones Lang LaSalle Hotels, a hotel investment firm, Miami area hotel investing is about to take off[1]. Over the past 12 months the hotel industry has begun to show signs of recovery in many areas around the country, with real estate investment trusts (REITs) and foreign investors showing renewed interest in the industry. Now, Jones Lang LaSalle predicts that “deal volume in the area could reach $750 million in 2011.” This would be a 250 percent increase over the previous year.

While not everywhere in the country is projected to experience such a dramatic comeback as Miami, executive vice president of Jones Lang LaSalle Hotels Fernando Garcia-Chacon predicts that Miami is definitely going to be a hot spot because of the high number of distressed properties currently controlled by lenders and “ripe for investment” in the area. Garcia-Chacon predicts that not only are investors ready to take advantage of low prices – and to snap up deals in a market that is not currently producing new-hotel construction – but that brand hotels like Marriott will also be looking to buy up previously-private properties and convert them. Short sales on hotels, already somewhat common in the area, could rise as well, showing that “these hotel experts do have a lot of confidence in South Beach,” he said.

Last year, many experts predicted that the hotel industry might not recover until late 2011 or even 2012 and beyond. Do you think news like this indicates that they were wrong, or is Miami an isolated example of resort property recovery?

Thank you for reading REJournalOnline’s Commercial Real Estate Letter.

Let us know if you plan to invest in hotels or other resort property in 2011 by leaving a comment below.

---

[1] http://www.miamiherald.com/2011/02/24/2084083/increase-in-hotel-investment-expected.html