United States -  Charlotte

The Charlotte market continued to diversify in 2017. The city, which is home to the University of North Carolina Charlotte (UNCC) and six Fortune 500 company headquarters, enjoys robust financial, healthcare, and retail sectors, as well as strengthening manufacturing, energy, and technology industries. The affordable cost of living, relatively low unemployment figures, and a diverse economy remain attractive to business professionals and families. Mixed-use developments boasting office, retail, and residential components continue to be developed throughout the city to accommodate the commercial and population growth. Additionally, the live-work-play focus in Uptown, redevelopment of the South End, and beautification efforts in University City will continue to spur growth within the entire Charlotte market. Although the Charlotte hotel market realized continued average rate (ADR) gains in 2017, market-wide occupancy declined by about 2%, to nearly 70% , as the influx of new supply affected market-wide performance.

According to the Charlotte Regional Visitors Authority, despite House Bill 2 (known as “HB2”) that was signed into law on March 23, 2016, aggressive marketing efforts helped increase attendance at the Charlotte Convention Center nearly 6% year-over-year in 2016. It is imperative to note that House Bill 142 was passed on March 30, 2017, which repealed HB2. The positive impact was felt immediately, as professional sporting events, such as the ACC National Football Championship, returned to the city. In May 2017, the NBA announced that the 2019 All-Star game would return to Charlotte. Moreover, meeting/group and leisure demand also strengthened in 2017. The commercial segment remains a vital demand driver. Class-A office towers and build-to-suit office buildings are being erected throughout the city, most notably in Uptown. The Lincoln Harris and Goldman Sachs mixed-use development on the former Charlotte Observer site in Uptown will feature an 845,000-square-foot office tower, of which 500,000 square feet has already been leased to Bank of America; this project is slated for completion in late 2019. Moreover, the extension of Charlotte's light-rail service, the LYNX Blue Line, from Uptown to the University of North Carolina at Charlotte (UNCC) was completed in March 2018.

Supply growth has remained moderate in recent years, adding guestroom inventory to each of the submarkets. Although approximately 45 hotel projects (roughly 7,000 rooms) have been proposed for the Charlotte market, roughly half are currently either under construction or in the active planning phases; the more speculative projects may take several years to come to fruition. Eight new hotels opened in 2017, adding a total of nearly 1,200 guestrooms to the market, of which roughly 50% are concentrated in the Uptown submarket. In early 2017, announcements were made that two significant projects, the Grand Bohemian Hotel and the InterContinental Hotel, each with approximately 250 rooms, would proceed for the Uptown area. A key consideration is that much of the new hotel supply will enter submarkets such as Southwest Charlotte, Uptown, South End, SouthPark, and Ballantyne, which are experiencing a simultaneous increase in office and residential developments. As such, the anticipated demand growth should absorb a decent portion of the additional guestroom inventory.

The pace of transactions in the Charlotte market strengthened in 2017, as transactions during that calendar year exceeded the total count for 2016. The sale of the Ballantyne Hotel, as part of the Ballantyne Corporate Park purchase by Northwood Investors, represented a significant real estate sale in the market. Three additional hotels were included in the sale of the Park, namely the Aloft, Courtyard by Marriott, and Staybridge Suites. The Ballantyne Hotel, which also features The Lodge at Ballantyne and The Cottage at Ballantyne, will remain a Luxury Collection by Marriott affiliate. Other notable 2017 transactions include the Hyatt Place Downtown Charlotte, Marriott Charlotte City Center, and Courtyard by Marriott Charlotte City Center, which all traded at per-key values in excess of $200,000.

* 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:

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%

Charlotte RevPAR Change

Charlotte RevPAR

Year RevPAR
2007 $54.02
2008 $51.97
2009 $41.71
2010 $46.06
2011 $50.50
2012 $56.72
2013 $57.39
2014 $64.28
2015 $70.09
2016 $76.20
2017 $75.97
2018 $74.43
2019 (f) $73.64
2020 (f) $76.24

For more information, please contact:

Janet Snyder, MAI
[email protected]
  • +1 972 978-4714 (w)
Patricia Shih
[email protected]
  • +1 404 791-5509 (w)