Per-suite hotel value rises 27% year-over-year

Colliers International third quarter hotel investment report shows a significant increase in sales activity in energy-reliant markets

By
Western Investor
November 15, 2017





hotel
Matrix Hotel in Edmonton was part of a three-hotel portfolio that also included Metterra Hotel on Whyte and Varscona Hotel on Whyte, sold for a total of $65.6 million this quarter.

 

Western Canada is seeing a rise in transaction activity, bolstered by a recovering energy market in Alberta.

A third quarter report on hotel investment by Colliers International shows a 27 per cent increase in per-room hotel value. The average price per room is sat at $161,200 this year. In total, national hotel investment volume hit $473 million this quarter.

Nearly $100 million in sales activity came out of Alberta.

“Hotel markets that are reliant on the energy sector have been through a difficult few years; however, the worst is now behind us. Lodging demand growth has returned and supply growth is moderating, providing the foundation for recovery,” the report states.

Alberta only saw $30 million in sales activity during the first half of 2017. In the third quarter, three boutique Edmonton hotels were sold for $65.6 million from Alberta-based property management company Westcorp to DSDL Canada Ltd.

The average deal size hit $21 million to-date this year, up 18 per cent from last year.

As Alberta begins to rebound from its energy recession, HVS Canada Vice-President Jason Wright suggests that now may be an opportune time to consider investing in energy-reliant hotel markets across Alberta and Saskatchewan.

“Financing [is] readily available and the performance of energy-driven hotel markets [is] improving,” he comments.


Tanya is Western Investor's web content and social media coordinator. She first joined the Western Investor team as a editorial assistant in 2016, after a summer spent freelancing at Glacier Media papers The Burnaby Now and New West Record. She is a graduate of Langara College's journalism program.
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