Canada’s hotels sector is attracting investors as the revenue generated by rooms increases.
A report from real estate firm CBRE reveals that in 2017, hotel investment volume reached $3.4 billion, which was down from $4.1 billion in 2016 but both years were heightened by significant entity-level/M&A deals that had not been a factor for over a decade. Removing that factor shows investment of $2.3 billion rivalling the highs of 2015 and 2016.
“The major components of the Canadian hotel market are synchronized and this positive momentum is carrying through to 2018,” commented Bill Stone, Executive Vice President of CBRE Hotels Capital Markets Group in Canada.
Among the largest deals in the sector last year was the sale of the Sheraton Centre Hotel in Toronto for $335 million, the largest ever single hotel transaction in Canada.
Revenue per available room is forecast to grow across all major regions of Canada with Central Canada leading with a 4.6% rise to $115. In terms of profits, Western Canada will lead the pack with an increase of 7.3% to $16,100 per room.