United States -  Tampa - St Petersburg

Overview:

Tampa benefits from a diverse and strengthening economic base, anchored by the education, healthcare, and military sectors, as well as professional and financial services. The University of South Florida (USF), which serves over 48,000 students, is affiliated with area hospitals such as Tampa General Hospital, All Children's Hospital, H. Lee Moffitt Cancer Center, and Shriners Children's Hospital. In December 2015, USF broke ground on a new medical school in the heart of Downtown Tampa as part of a $2-billion redevelopment of Tampa’s Channelside District, led by Jeff Vinik’s Strategic Property Partners LLC in a partnership with Bill Gates’ Cascade Investment LLC. The $153-million medical school project had received $57 million in state funding and $18 million in private donations as of December 2015. Other major economic drivers include the MacDill Air Force Base, one of the largest employers in the area, and the Port of Tampa. Additionally, construction is one of the fastest growing sectors for job growth, with major projects under way such as the $953-million master plan at the Tampa International Airport that broke ground in November 2014, employing approximately 1,500 construction crew workers.

The outlook for the greater Tampa market is positive, as many area residents look forward to the strengthening of the housing market, the expansion of existing employers, and the relocation of new businesses. Tampa's consistent position among the most cost-efficient places to live and do business in the nation attracts considerable investment to the region. Furthermore, infrastructure projects, coupled with higher levels of leisure travel and convention activity, should further support the economy and lodging trends. Despite a minimal decrease in supply levels, both occupancy and average rate increased in 2015; this positive trend is also evident in the year-to-date data for 2016.

Eighteen hotels totaling $423 billion in transaction volume have sold since January 2015, including such significant assets as the Westin Tampa Harbour Island in April 2015 (highest total price paid at $65,000,000 or $217,391 per key). The majority of the transaction took place in the Tampa area proper, with several smaller transactions in the outlying areas. While improving market conditions and high investor interest have put downward pressure on capitalization rates, driving hotel values to peak levels, further growth is expected to be held in check given that interest rates and capitalization rates are now beginning to rise.

* The HVI is an index, a statistical concept reflecting a measure of the difference in the magnitude of a group of related variables compared with a base period. As such, it is a measure of broad market trends, rather than a conclusion as to the specific value of any asset, and cannot be applied to an individual asset. A good comparison is the Consumer Price Index. While this index provides a reliable measure of the overall rate of inflation in a region, it does not indicate how the price of milk has changed at your grocery store. So how can the HVI be of use to an individual investor? Although the HVI cannot tell you what a particular hotel is worth, it does provide excellent big picture data, indicating which market areas are experiencing positive trends, and thus may present good investment opportunities. The HVI for the U.S. is a measure of the strength of the lodging industry as a whole and, specifically, the hospitality investment market. The HVI for the various identified markets can provide a basis to evaluate and compare different geographic regions. For more insight on the limitations and applicability of the HVI, please read the message on the HVI home page by clicking on the graphic at the top of this page.

Valuation Trends and Predictions:

Tampa - St Petersburg United States
Previous Year +1% (51 of 71) +1% (49 of 71)
Growth in 2017 +2% (34 of 71) +2% (36 of 71)
Growth in next 3 years +10% (34 of 71) +10% (36 of 71)

Change In Value For Market:

Tampa - St Petersburg RevPAR % Change

For more information, please contact:

Kathy Conroy, MAI
kconroy@hvs.com
  • +1 305 378-0404 (w)
John Lancet, MAI
jlancet@hvs.com
  • +1 305 378-0404 (w)
  • +1 305 502-1167 (m)