United States -  Norfolk - Virginia Beach

The Hampton Roads area comprises several cities, including Norfolk, Williamsburg, Hampton, Newport News, Suffolk, Portsmouth, and Virginia Beach, among others. The economic base of the Hampton Roads area revolves heavily around tourism, the federal government, and the military and aerospace industries. The area is home to eleven major military installations representing all branches of the U.S. Armed Forces, including the world's largest naval base, Naval Station Norfolk. These military stations, as well as related defense contracting firms, generate significant lodging demand for the market. The healthcare and education sectors, as well as leisure attractions, are the other primary demand generators for the market.

The Hampton Roads area, driven largely by Norfolk and Virginia Beach, has been experiencing growth in recent years, and revitalization efforts are continuing throughout the Downtown, Town Center, and Waterfront areas. In Norfolk, the Waterside District, City Walk, and Norfolk Premium Outlets developments should continue to promote the area as a retail and entertainment destination. The healthcare sector, led largely by Sentara and Bon Secours throughout the area, is strengthening, supported by the relatively recent expansion of Sentara Leigh Hospital, the creation of the Bon Secours Cancer Institute at DePaul, and the ongoing $199-million expansion of Sentara Norfolk General Hospital (scheduled for completion in 2020). The Hampton Roads area is anticipated to experience continued growth in demand levels as the military and government sectors remain strong under the current administration.

Supply has largely stabilized in recent years, coupled with numerous closings of older hotels. Many older hotels have been converted to other brands over the past several years, as well, including the area's two Delta Hotels by Marriott properties and the addition of The Cavalier hotel in Virginia Beach to the Autograph Collection in early 2018. Notable hotel openings have included the 300-room Hilton Norfolk at The Main (a mixed-use entertainment, meeting, dining, and hotel development) in March 2017 and the 183-room Holiday Inn Newport News Hampton in May 2018. Hotels under construction include the Hyatt Place Hampton Convention Center, the Marriott Virginia Beach Oceanfront, and the Hyatt Place Virginia Beach Town Center.

Transaction activity has been steady in the Hampton Roads market during 2018. The Homewood Suites by Hilton Virginia Beach sold in August 2018 for the highest price per room in the market at $293,426 per key. Of the confirmed hotel sales in the market area, the average sale price in 2018 was nearly $70,000 per key, in line with the overall average for 2017. Hotel values should remain relatively stable in the coming years given the abundance of older assets and in consideration of the market's stability.

* 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.

Change In Value For Market:

Legend
Significant Value Increase: Greater than +10%
Moderate Value Increase: Between +3% and +10%
Stable Values: Between -3% and +3%
Moderate Value Decline: Between -3% and -10%
Significant Value Decline: Less than -10%

For more information, please contact:

Chelsey Leffet
[email protected]
  • +1 202 434-8793 (w)
  • +1 302 740-2772 (m)