In 2014, investment totaled $22 billion in the United States for hotels with a reported selling price, according to Lodging Econometrics. Equity funds were the most active investors, adding $7.4 billion in hotels, most of which were portfolio purchases. Publicly traded REITs were the next biggest acquirers. They invested $6.4 billion, primarily focusing on high-profile single assets divested by privately held hotel companies. Although on balance they were net-sellers in 2014, privately held hotel companies were also significant buyers, investing $4.4 billion, mostly in single assets and smaller portfolios.
Publicly traded REITs were significant purchasers of large, high profile, single-asset luxury and upper upscale hotels that only come to the market during periods of high liquidity. The demand for these assets from equity funds, REITs, and privately held hotel companies caused a shift in the 2014 transaction mix. For the first time in this cycle, more than 50 percent of all hotel transactions occurred in the luxury, upper upscale, and upscale chain scales.