Hotels in Western and Southern States Lead the Rest of the U.S. – Winston Rowe and Associates

Investor appetite in hospitality properties in Western and Southern U.S. is growing due to economic growth, healthy occupancy and rising tourism.
By: Winston Rowe and Associates
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DALLAS - April 29, 2019 - PRLog -- Counties in the South and the West lead the nation in population growth, according to the U.S. Census Bureau.

Texas counties take four of the top 10 spots in population growth in the U.S., while a number of other secondary and tertiary markets take the other spots.

This is occurring at the same time as corporate occupiers are expanding away from primary metros.

The hotel industry tends to be reactive and hotels do better in areas with good population growth, which dovetails with good economic growth.

Texas will add the most hotel rooms in the U.S.  this year, with around 25,500 rooms underway.

Nashville, Tenn. has increased its hotel inventory by 19 percent in the past five years, the biggest five-year inventory changes in the United States.

Six of the top 10 states with most rooms underway as a percent of existing stock are located in the West or the South.

New York and Indiana are the only states not in the South or West in the top five for rooms underway as a percent of stock.

Southern and Western markets with low supply pipelines and low cost of entry, including Florida, Idaho and Washington, will likely attract investors, according to industry sources.

Northwest has rooms under construction that total only 2.5 percent of existing stock, while Florida's under-construction inventory as a percentage of stock has stayed the same since December, at 4.1 percent. In comparison, New York leads the rest of the U.S. in rooms underway as a percent of stock with 7.1 percent.

New regulations on short-term rentals in Seattle will also likely dissuade homeowners from renting out their properties through sites like Airbnb, further benefiting the hospitality sector there.

The hotel sector as a whole remains relatively under supplied compared to historical data, however.

This adds to an already favorable environment for hotel developers. Pre-2008 crash, the percentage of growth in new hotels came to about 4.6 percent of total inventory.

Today, new supply, on a nationwide scale, represents around 1.8 percent of existing stock.

Annual occupancy rate for hotels nationwide is forecast to climb to 66.5 percent this year, a more than 30-year record high.

Winston Rowe and Associates published this article, they are a national consulting firm. You can contact them at

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