1 The availability of quality construction
The biggest challenge for us as a developer today is the availability of quality construction personnel, both management and labor. Our reputation and our many long-standing relationships help mitigate this challenge, but I don’t see the situation easing in the foreseeable future.”
Nick Kellock
Chief Operating Officer
Concord Hospitality
2Increasing pressure on brand expansion
“As a hotel developer, there are many reasons to be grateful about the last year and excited about the future. While at Midas Hospitality, we tend to focus more on opportunities than challenges, we find the increasing pressure on brand expansion is challenging investor/owner expectations for hotel performance and returns. That tension is resulting in delays in capital raising or development timelines. We believe success can best be achieved when the brand, owner/operator and developer groups are communicating early, often, and candidly, so the right deals can be implemented in the right submarkets with the right guest offering.”
JT Norville
Co-Founder & Managing Partner
Midas Hospitality
3Tightening debt terms
“Banks are remaining very disciplined as the cycle continues. Tightening debt terms require significant equity commitments to get projects funded. This higher cost of capital, coupled with recent wage growth, suggest that only the most attractive developments are feasible. The good news is that these factors keep supply in check.”
Richard Stockton
CEO
Braemar Hotels & Resorts
