Goldilocks and the Three Reasons Most Hotel Markets Will Not Become Overbuilt

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Key Takeaways

Another down-cycle might occur as the result of overbuilding, spreading hotel demand thinly enough to cause financial distress and all the unpleasantness that goes along with it. But in this article, I provide three reasons for believing that excessive supply growth is unlikely to produce financial distress in most hotel markets across the U.S. From my current vantage point, a Goldilocks supply scenario is likely to take place over the next few years in most cities: not too many and not too few hotel rooms created.