CBRE Hotels forecasts that the new supply of hotel product will increase by 2.0% in 2019, marking the highest single year of supply growth in the Canadian hotel market since the financial crisis of 2008. This will be driven by owners who are flush with capital pursuing new-build development opportunities in the suburbs of Canada’s largest cities, where land acquisition and development costs remain reasonable.
And with substantially more hotels and portfolios currently for sale this year, CBRE further predicts that 2019 hotel investment volume will exceed last year’s total of $1.5 billion, and surpass the 10-year average of $1.8 billion. Domestic and foreign investors — seeking a safe haven amid global economic uncertainty — continue to show strong interest in acquiring hotels in Canada.