According to a recent report by the Jones Lang LaSalle Hotels, investor interest in the San Francisco hotel investment market isn’t going to disappear anytime soon. 

The report states that more than three-quarters of upper-upscale hotels have recently or are currently undergoing a renovation, and that the San Francisco market is an example to other markets on how to maximize revenues and make value even amid an economic downturn.

“Already a front-runner in year-to-date RevPAR gains, San Francisco’s investors are focusing their attention – and dollars – on capital improvements, which will lift the ADR ceiling even higher, and will give way to a stronger position once transaction levels accelerate,” said Kristina Paider, senior vice president of research and marketing for Jones Lang LaSalle Hotels.

Few hotels are up for sale in the market, leading investors to put their money into renovations and income enhancement. The entire market is characterized by a high barrier-to-entry, with only 4 new hotels being built and opened since 2004.

A good sign that the downturn isn’t an exclusively negative force, and that several markets such as San Francisco continue to improve value and profit.

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