Chasing yield

Boosted by record occupancies, rising room rates and economic optimism, investors are spurring hotel sales and development throughout the Gulf Coast.
Capital is coming from private equity funds, mortgage-backed securities, foreign investment groups and publicly traded real estate investment trusts, along with traditional banks and insurers.
“It's a tremendous amount of capital, perhaps more than I've ever seen,” says Kent Schwarz, an executive vice president with commercial brokerage firm Colliers International.
In all, 45 new hotels are planned or under construction from Tampa to Naples, according to data from industry researcher STR Inc. — spurring talk of a possible bubble.
“There's a segment that says we're in a paradigm shift with hotels, and people who say it's a bubble in the making,” says Daniel Lesser, president of LW Hospitality Advisors, a New York-based firm.
In Sarasota alone, nearly a dozen new projects have been proposed, though only two new major hotels — a Westin and an aloft containing about 400 rooms — are under construction.
Industry analysts note that hotel fundamentals — including revenue available per room, a key industry metric determined by rates — are at all-time highs amid a surge in business and group travel.