How six experts drive growth in fragmented U.S. hotel market

LOS ANGELES ─ Hotel investors are eager to deploy capital. The problem is how. Elevated construction costs, financing constraints, mixed U.S. market performance and lingering uncertainty have taken easy answers off the table. But industry leaders see deal-driving potential in emerging alternative strategies tailor-made to outmaneuver fluctuating fundamentals.

Experts from all sides of the hotel investment sector came together at a closed-door, in-person roundtable held here alongside the Americas Lodging Investment Summit (ALIS) conference in late January to discuss the nimble solutions they're using to grow portfolios and profits in today's changeable landscape.

Offering insights on “Navigating growth in a fragmented U.S. hotel market: Capital deployment strategies and opportunities,” were: Michael DiPrima, executive vice president & co-head of national hotel partners, CBRE Hotels; Eric Jacobs, chief global growth officer, Aimbridge Hospitality; Michael Lipson, CEO and chairman of the board, Access Point Financial (APF); Steven Nicholas, managing principal and head of asset management, Noble Investment Group; Lisa Sexton, senior vice president, full-service development, U.S. East Region and Canada, Marriott International, and Jon Stanner, president and CEO, Summit Hotel Properties (SHP).

Mary Scoviak, custom and design content director, Hotel Investment Today by Northstar, moderated the roundtable, which was sponsored by Aimbridge Hospitality on Jan. 27, 2026.

Focus on what's in your control

Panelists acknowledged the importance of understanding major market forces. But they advised investors to devote less runtime to trying to micromanage the macroeconomics that are out of their control and more time to mapping action plans around the opportunities that are.

“The decisions we make, the data we analyze, what we look at, the decision to proceed or not to proceed…having a disciplined approach to investing and a discipline on the buy and the sell side ─ those are things we can control,” said Nicholas.

Applying that approach kept Noble's portfolio growing in 2025. “There are some really good deals, but not a lot of them,” said Nicholas. He recommends looking at sub- and micro-markets, situations with owners facing financial challenges (loan refis, PIP costs, etc.) that push them to divest the asset and cases in which owners “just want to get out of the business or protect other assets” to find assets with the right upside.

The definition of “in control” differs from the lender’s standpoint, but, like Nicholas, Lipson counsels investors to keep their eye on the deal, not the 60,000-ft. view.

“You can’t spend too much time looking at the data. We all use it, but there’s a point at which you have to stop, take out that noise out and start focusing on the individual transaction,” said Lipson.

That knowledge is key to getting Lipson’s “yes” for financing. “As a lender, we’ve got to watch carefully. Is it the right owner? That is always number one. Is it the right asset? Because we're more of a bridge lender, there's got to be a story, and can we buy into the story? That's how we make loans…it comes down to the individual asset.”

As a public company, Stanner said SHP can control “how we allocate capital and how we finance either developments or acquisitions, how we think about buying and selling assets. We have an ability to allocate capital and to buy our own stock back, which gives us another lever.”

Control tactics also need to shift when circumstances do, noted some executives. That includes thinking through portfolio management and exit planning.

“One of the things I'm starting to see versus what happened in this past cycle [is] a little longer-term perspective around the time it's going to take for me to mature the asset and maybe to sell that asset or recapitalize it,” said Jacobs. “It used to be a three- to five-year window. Now, it might be more like a five- to seven-year hold period.”

Fill the gaps

The parts that individual investors can't control are the bigger impediments to more transaction volume, more development activity and, first and foremost, fundamentals, said Stanner. “There’s been an enormous amount of uncertainty on our trajectory. Uncertainty creates inaction, and that’s put a damper on new development and slowed the transaction environment.”

He added it's “really difficult” to get buyers or sellers to agree on RevPAR trajectories and therefore profitability trajectories. “So, it creates this natural impediment to activity.”

However, investors with more patience and deeper pockets are uncovering situational workarounds to tap veins of potential in an otherwise sluggish market. According to Jacobs, the 104 2026 FIFA World Cup matches being played in 11 U.S. cities from Los Angeles to New York and a series of global events culminating in the 2028 Olympic and Paralympic Games, also being held in LA, are sparking a welcome resurgence in international tourism.

“I do think [these events] will create some great demand. But, we need to have support from the national government to help with visas to make it easy, affordable and accessible for people to come into this country,” said Jacobs.

He added, “I think it's something, as an industry, we've been working on and trying to help at least the last four or five administrations, trying to help understand that international business is an important piece and we should be growing it, not shrinking it. This event [the 2026 FIFA World Cup] will help...it could be a potential catalyst to how we think about inbound business. And I think that could be promising.”

Los Angeles could among the early beneficiaries, according to DiPrima, as it moves from a challenging 2025 into a 2026 that sees the city in the global spotlight.

Nicholas and Lipson say extended-stay concepts could be primary development drivers, especially as major brand families incorporate them into their growth plans. Both like the resilience of this segment's cost-efficient operations and cost-effective long-stay business model in up and down cycles.

Maybe next year?

Classifying himself as an optimist, DiPrima predicts, “The minute we have sound fundamentals and groups willing to go back risk on, there's going to be a ton of transaction volumes that happens, likely in the back half of this year,” he said.

Jacobs spoke for many investors who had the same unfulfilled hopes for 2023, 2024 and 2025. DiPrima acknowledged that, adding, “Yes, we’ve been coming up with excuses or reasons not to do deals. We’ve had tremendous amounts of rate reductions, spreads are coming in, and yet everyone's like, ‘Well, where are the buyers?’”

Lipson agreed the equity hasn't shown up. “We had our best year ever in 2025, but 90% of our business was refis,” he said. Jacobs questioned if unrealized transaction growth simply reflects how hard fundamentals to gauge right now.

“Equity investors want to know the fundamentals are strong and that the future is moving in the right [direction],” Jacobs said.

Stanner was hopeful fundamentals would shift more positive this year, expressing industry consensus the sector is most interesting to invest in when, early in a cycle, there’s a good amount of runway, good RevPAR, EBITDA and profitability growth.

Tap into a new pipeline

Escalating deferred maintenance costs and debt service driven by COVID’s impact may bring more assets to market.

“What's driving sales today are debt maturities that are coming up. If there's not a refi option and they need to sell, we'll take it out. Large-scale PIPs that are viewed as defensive in nature, not accretive, are pushing sales, especially in the larger, full-service hotels and secondary locations,” said DiPrima.

Lipson suggested wrangling PIPs also can be tricky, particularly on the brand side. “People come to us and they think they have a contract…and then they get the PIP. And where a PIP might have been $40,000, $50,000 (per key) in the past, now we're seeing $75,000, $100,000.”

Marriott’s Sexton noted PIPs on the full-service side are regularly in that $75,000-to-$100,000 range, which she termed “just shocking.” She chalked it up to some assets not having been renovated since before 2019.

“That’s why the PIP is needed. We're trying to be as flexible as we can, but sometimes you’ve just got to do it,” she said.

Jacobs contended a seller shouldn't go to market without knowing the cost of meeting brand standards. “Make that part of the [sales] plan. If you spend all this time getting the buyer into due diligence and then you tell them, ‘By the way, the PIP is $100,000,’ the buyer can say, ‘I can’t afford that, so I need to retrade on price.’ Sellers need to address that upfront.”

Stanner cited an “enormous disconnect” between owners who feel it’s been really difficult to make money owning hotels, and the guest perception that hotels are more expensive and the product quality and delivery has worsened.

Competition forces the proactive operator to keep an asset maintained, particularly minus a PIP or big CapEx, according to Jacobs. “We have to be as nimble as we can, keep it really, really clean, stay on top of the fundamentals of great guest service and hopefully, we can overcome a dated product and drive the rate and the return for the guest.”

Marriott’s Sexton said the franchisor is trying to be a little more thoughtful, tailoring a PIP and a standard to a market-specific requirement that the customer’s going to expect. “That way we can help save money and prioritize what's going to be important to that consumer in that specific hotel,” she said.

Opportunities to prime pipeline flow

For investors who have capital and/or an appetite for risk, the search for opportunities to enter the pipeline continues.

As to where, Jacobs noted there’s no magic answer; rather, it’s about the long-term fundamentals of a marketplace. He indicated opportunities still exist in New York, San Francisco and Seattle (albeit with some challenges), as well as in key leisure markets with strong fundamentals and good airlift.

DiPrima cautions investors to get a more holistic picture of markets before putting a pin the map. “E veryone today is like, what do you have in San Francisco? Well, it's still 20% behind where it was in 2019. So it has lots of room to run. On the flip side, you look at markets like Austin, which was down three plus percent in RevPAR, partially mostly driven by a convention center being offline.”

He added, “You look at San Diego, Nashville, Phoenix, all down two-and-a-half 3%...You go back 12 months ago at this conference, everyone was hyped on DC with the new administration. They predicted there would be tons of business coming to DC. Today, I would say DC is probably one of the most challenging markets in some ways to look at for the future. You could say the same for LA too. I mean, this is my backyard. LA has been off the radar for many investors because of mansion tax and minimum wages going to $30 an hour. But over the next three years you have the FIFA World Cup, SuperBowl LXI, the Olympics. There's a point in time where, you know, maybe groups should start leaning in here.”

Sexton said projects taking off this year generally have been long-term holds. “We've got owners who've had land for a while, the entitlements have taken a couple of years. We've gotten a lot of (full-service) new-build projects off the ground last year or at least signed,” she said, noting some have been worked on for three years.

“So, these owners are finally at the point where rates have come down a little bit, construction costs seem to be a little more stable and they're ready to pull the trigger,” said Sexton.

Jacobs noted larger, more impactful projects for a community have to have government support in some way to help those deals actually pencil, “otherwise they're just going to sit there,” he said.

With all these growth options, Nicholas closed on a positive note.

“As I look at this past year, if we would have been sitting here at ALIS last year, and we would've said we would've had a Liberation Day, that we would've insulted most of the countries in the world and that we would've had DOGE and that all this was going to happen, I think we would've been sitting here saying this year would've been down four or five percent RevPAR year over year; we're basically flat down a half a percent. So, I don't think it's as bad as it's perceived; I think everything is recoverable. The question is really just time. I think there's some positive things going out there from travel.”

He added, “I do think there's, there's some positive trends. People still want to travel and travel is going to continue to grow. I don't think it all happens in first-quarter ’26, but I do think there's some positive things about travel that should give us all confidence.”

Stefani C. O’Connor is a journalist based in New York City.

The views and opinions expressed in this content do not necessarily reflect the opinions of Hotel Investment Today by Northstar or Northstar Travel Group and its affiliated companies.