JLL on elevated levels of $1 million per key US trades

NATIONAL REPORT — Following the impact of the pandemic in 2020, the number of single-asset hotel transactions in the U.S. with an average price per key exceeding $1 million has experienced a surge, reaching record-high levels over the last three years.

Hotels that command prices above $1 million per key include trophy assets of renowned international hotel brands located in major global cities, as well as luxury hotels in prime urban or resort destinations. By the end of 2023, the total number of such transactions stood at 13, which is 53.9% higher than the long-term average since 2015.

This notable increase in the number of transactions with an average price per key above $1 million signifies a strong market demand for full-service hotels, particularly in urban markets that are experiencing a resurgence in group, business and international demand.

JLL said the record-high pricing for full-service hotels provides additional confirmation of the sector's appeal to investors. In 2023, the average price per key for these hotels reached $381,000, surpassing the previous peaks in both 2019 and 2015 by 15.2% and 13.1%, respectively. This trend suggests that the full-service hotel sector will continue to attract investors over the long-term, especially as global wealth is forecasted to reach $629 trillion over the next five years.