The outlook for hospitality investments: opportunities exist for bond investors who diversify among major hotel sectors

Article Abstract:

Investors should diversify their hospitality investments within different hotel segments. Bond investors can obtain their best rate of return through investments in full service properties because after the overbuilding during the 1980s, occupancy rates, operating profits and room rates increased during the 1990s. Investors in commercial mortgage-backed securities should invest in full service and limited service hotels because limited service hotels have continued to have high occupancy rates and profits in spite of strong new construction.

Hotels & Motels, Hotels (except Casino Hotels) and Motels, Hotels and motels, Finance, Real estate investment, Real estate investments, Securities, Hospitality industry, Return on investment

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The dream world of the 1980s revisited

Article Abstract:

Alec Smart purchased a seven story office building for $705,000 in 1980, and made more than $200,000 a year from the property between 1980 to 1985. A real estate broker convinced Mr. Smart that he would do better if he rented the entire building to one client. After an initial hesitation, he allowed the broker to search for such a tenant. He subsequently turned down an offer of $6 million and eventually reached a forty year lease agreement, beginning with $325,000 the first year and increasing to $2.7 million.

Case studies, Column, Real estate industry

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Searching for the bottom of the office market

Article Abstract:

The commercial real estate market has experienced a deep depression and the office niche has been particularly hard hit. In 1991 and 1992, the price mechanism did not forestall further declines in the commercial real estate market due to the capital crunch caused by enhanced capital standards for financial institutions. The office market is approaching the bottom of the trough in the price cycle; office prices may begin to recover by the end of 1993 as the effects of the capital crunch begin to dissipate.

Office buildings

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