The decline in international travel remains a key challenge
Sonesta’s extended-stay brands, Simply Suites and ES Suites, remain strong even as more travelers turn to economy hotels, said Brian Quinn, the company’s chief development officer.
Vishnu Rageev R is a journalist with more than 15 years of experience in business journalism. Before joining Asian Media Group in 2022, he worked with BW Businessworld, IMAGES Group, exchange4media Group, DC Books, and Dhanam Publications in India. His coverage includes industry analysis, market trends and corporate developments, focusing on retail, real estate and hospitality. As a senior journalist with Asian Hospitality, he covers the U.S. hospitality industry. He is from Kerala, a state in South India.
SONESTA INTERNATIONAL HOTELS Corp.'s extended-stay brands, Simply Suites and ES Suites, continue to perform well, even as travelers shift toward economy hotels during challenging economic times, said Brian Quinn, Sonesta’s chief development officer. The company remains focused on evolving its lifestyle and luxury brands, with a strong emphasis on F&B.
However, the decline in international travel remains a significant challenge for the industry.
“Extended stay continues to be a juggernaut. We’ve got two offerings under Sonesta—Simply Suites in the midscale segment and ES Suites in upscale. When the economy wobbles, extended stay often benefits. People scale down a bit, and this segment holds strong. Similarly, while the economy segment had a strong run and has recently come back to earth, there’s still room for growth,” Quinn said during an interview at AAHOA’s 2025 Convention and Trade Show.
“We’ve been working with owners to optimize sites by exploring options like orienting the building lengthwise or choosing between three and four stories,” he said. “It’s fully digital and AI-driven—the three-story version offers 89 rooms, and the four-story about 122, all on less than two acres. The goal is to maximize revenue potential for owners.”
Key developments
Quinn spoke about preparing Sonesta’s owned assets first and holding themselves accountable before expecting the same from franchisees.
“We’re investing about $200 million in hotel improvements this year despite all the uncertainties,” he said.
On development, Quinn shared updates on two major projects in Miami.
“We’ve got a 336-room James hotel coming up in downtown Miami,” he said. “It’ll be the tallest building in the city and will feature a private club, spa, fitness center and rooftop amenities. We’ve just finalized the capital and structure to make it a brand-in-residence.”
He also announced plans to renovate the Nautilus property on Miami Beach.
“Our affiliated company acquired it for about $175 million,” Quinn said. “That’ll be another James, this time right on the ocean—an exciting step forward for the brand.”
Quinn spoke about executing Sonesta’s playbook focused on being fast, friendly, and flexible. He emphasized the importance of franchising with an owner’s perspective, a point also highlighted on the main stage.
“When we set brand standards, we implement them ourselves,” he said.
He reflected on the company’s rapid growth, noting it now manages just under 1,200 hotels, up from fewer than 50 five years ago.
“We’re following the playbook. First, we integrated finance, legal, and HR,” Quinn said. “Over the last year and a half, we’ve unified everyone on one reservation system and a single loyalty program.”
Sonesta’s loyalty program, Travel Pass, now spans 13 brands, including America’s Best Value, Signature, and Red Lion by Sonesta.
“We cleaned up our brand portfolio too, removing a few brands while others are expanding,” he said. “It’s a bit counterintuitive but strategic.”
The company ran a successful process across 114 hotels put up for sale, attracting 3,040 bidders, Quinn said.
“We reached our target price and are now finalizing purchase and sale agreements, which is incredible,” he said.
Construction lags post-COVID
Quinn said the hotel industry has yet to return to a normal construction cycle post-COVID.
“Inflation was the first major headwind, and now people are stalling a bit, waiting to see how much longer this uncertainty will last and what costs will ultimately look like,” he said. “That said, I think most are being very deliberate and cautious in their decision-making.”
“At some point, we have to figure out how to be more welcoming,” he said. “International travelers might only be a small share, but they’re incredibly hard to replace. That’s a big reason why the West Coast—places like Portland, Seattle, and San Francisco—continues to struggle. We lost all the inbound traffic from China, and you simply can’t make that up.”
Quinn noted he initially expected the market to start turning but didn’t foresee a second wave of disruption.
“I think the Fed gets it, they’re not going to mess with rates unnecessarily,” he said. “But still, there are real headwinds for new construction. That said, I always remember: in previous downturns, during the dot-com bubble, the real estate crash, 9/11, the people who moved first and took risks came out ahead. First movers tend to see better returns.”
He believes the operational discipline gained during the pandemic will continue to serve the company well.
“The muscles we built during COVID will help us navigate this moment too,” he said. “Hopefully, the environment stabilizes soon.”
Despite the uncertainty, Quinn said the fundamentals of hospitality investment haven’t changed.
“We know people want to be near the water,” he said. “They want to be in downtown locations. They want walkable food and beverage. If you're off an interstate, you need fuel and food nearby. These basics haven’t changed, and we’re getting better at conversions across the board.”
Quinn said the AAHOA convention has been successful and that New Orleans has been an excellent host city this year.
“Whether we do it in New Orleans or Las Vegas, we tend to get a strong turnout,” he said. “In these turbulent economic times, it’s important that we come together and speak with one voice. We’re using our collective influence to inform policymakers and others about the real impacts on travel and tourism. Hopefully, we’ll find our way through these challenges. As we said from the main stage, resiliency is part of our DNA.”
Global hotel rates are expected to remain stable through 2026, according to AMEX GBT.
New York is a key business travel and meetings destination.
India is likely to be a focus for travel programs during 2026 negotiations.
GLOBAL HOTEL RATES are expected to remain stable through 2026, as geopolitical tensions and potential U.S. tariffs limit demand and constrain price increases, according to American Express Global Business Travel. New York remains a popular destination for business travel and meetings.
AMEX GBT’s Hotel Monitor 2026, an annual forecast of global hotel rates in business travel destinations, identified India as a key market, with hotel rates and occupancy set to rise.
“This year’s forecast reveals a global environment where geopolitical uncertainties are tempering hotel rate increases,” said Dan Beauchamp, Amex GBT’s vice president for consulting. “These insights allow businesses to make more informed travel decisions. Understanding local market conditions will help companies optimize travel budgets and strategies.”
The report also projects continued rate increases for high-end accommodation based on demand.
New York hotel rates are projected to rise 4 percent in 2026. Despite expected softening in inbound U.S. travel from tariff uncertainty, New York remains a leading destination for business travel and meetings. The forecast is based on company data and IMF inflation and GDP projections.
India is expected to see rising hotel rates and occupancy in 2026. Rate growth will be below last year’s levels but above regional and global averages. India is likely to be a focus for many travel programs during 2026 negotiations. Bengaluru, a major technology and AI hub, recorded the country’s highest occupancy and ADR in the first quarter of 2025.
Simon Fishman, Amex GBT’s vice president for global hotels, said data shows news cycles can affect hotel prices in unpredictable ways.
“Amex GBT’s hotel marketplace gives companies access to over two million properties across 180 countries, including more than 45,000 hotels with pre-negotiated discounts and amenities via the Preferred Extras Hotel Program,” he said. “It enables companies of all sizes to adapt to changing business needs while accessing the best rates and traveler experiences.”
A May report by commerce media firm Criteo found that hotel booking values in Asia-Pacific rose 23 percent in early 2025, compared with 2 percent growth in the Americas.
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Peachtree Group originated a $176.5 million retroactive CPACE loan for a Las Vegas property.
The deal closed in under 60 days and ranks among the largest CPACE financings in the U.S.
The company promotes retroactive CPACE funding for commercial real estate development.
PEACHTREE GROUP ORIGINATED a $176.5 million retroactive Commercial Property Assessed Clean Energy loan for Dreamscape Cos.’s Rio Hotel & Casino in Las Vegas. The deal, completed in under 60 days, is its largest credit transaction and one of the largest CPACE financings in the U.S.
The 2,520-room Rio, now under the Destinations by Hyatt brand, was renovated in 2024 and comprises two hotel towers connected by a casino, restaurants and retail, Peachtree said in a statement.
“This transaction is a milestone for Peachtree Group and a testament to the ecosystem we have built over the past 18 years,” said Greg Friedman, Peachtree's managing principal and CEO. “Through our vertically integrated platform, deep expertise and disciplined approach, we have developed the infrastructure to be a leader in private credit. Our ability to deliver speed, creativity and certainty of execution positions us to provide capital solutions that create value for our investors and partners across market cycles.”
Atlanta-based Peachtree is led by Friedman; Jatin Desai as managing principal and CFO and Mitul Patel as principal.
The CPACE loan retroactively funded the renovations, allowing the owners to pay down their senior loan, the statement said. The property improvement plan included exterior work, upgrades to the central heating and cooling plant, electrical infrastructure improvements and convention center renovations.
Jared Schlosser, Peachtree’s head of originations and CPACE, said the deal marks an inflection point, with major financial institutions consenting to its use for the benefit of the capital stack.
“By closing quickly on a marquee hospitality asset, we were able to strengthen the position of both the owner and its lenders,” he said.
The CPACE market has surpassed $10 billion in U.S. originations in just over a decade, according to the C-PACE Alliance, with growth expected as more institutional owners and lenders adopt it.
“We see significant opportunity for retroactive CPACE and its use in funding new commercial real estate development,” Schlosser said. “It is an alternative to more expensive forms of capital.”
In June, Peachtree named Schlosser head of originations for all real estate and hotel lending and leader of its CPACE program. Peachtree recently launched a $250 million fund to invest in hotel and commercial real estate assets mispriced by capital market illiquidity.
Spark acquired the 120-key Home2 Suites by Hilton Wayne in Wayne, New Jersey.
Hunter Hotel Advisors facilitated the transaction with DC Hospitality Group affiliates.
The 2020-built hotel is near William Paterson University and less than 20 miles from Manhattan.
SPARK GHC RECENTLY acquired the 120-key Home2 Suites by Hilton Wayne in Wayne, New Jersey, from affiliates of DC Hospitality Group. Hunter Hotel Advisors facilitated the deal for an undisclosed amount.
The 2020-built hotel is less than 20 miles from Manhattan in a commercial corridor with major employers including Driscoll Foods, FedEx Group, Advanced Biotech, St. Joseph’s Wayne Hospital, and the Passaic County Administration, Hunter said in a statement. William Paterson University, Willowbrook Mall, and MetLife Stadium are also nearby.
It features an on-site fitness center, business center and indoor pool.
“The Home2 Suites by Hilton Wayne represents the type of asset we target,” said Patel. “Its proximity to major corporate demand generators, higher education institutions, and retail and entertainment venues supports strong performance.”
Hunter’s senior vice presidents, David Perrin and Spencer Davidson, brokered the transaction.
Patel said this is their second transaction with Hunter and praised the process and partnership.
“We look forward to building on the hotel’s recent performance and continuing to deliver guest experiences in the Greater New York City community,” he said.
Northstar Hotels Management recently acquired a 78-key Residence Inn and an 81-key Courtyard near the Jacksonville, Florida, airport.
Global pipeline hit a record 15,871 projects with 2.4 million rooms in Q2.
The U.S. leads with 6,280 projects; Dallas tops cities with 199.
Nearly 2,900 hotels are expected to open worldwide by the end of 2025.
THE GLOBAL HOTEL pipeline reached 15,871 projects, up 3 percent year-over-year, and 2,436,225 rooms, up 2 percent, according to Lodging Econometrics. Most were upper midscale and upscale, LE reported.
The U.S. leads with 6,280 projects and 737,036 rooms, 40 percent of the global total. Dallas leads cities with 199 projects and 24,497 rooms, the highest on record.
LE’s Q2 2025 Hotel Construction Pipeline Trend Report showed 6,257 projects with 1,086,245 rooms under construction worldwide, unchanged in project count and down 3 percent in rooms from last year. Projects scheduled to start in the next 12 months totaled 3,870 with 551,188 rooms, down 3 percent in projects but up 1 percent in rooms. Early planning reached 5,744 projects and 798,792 rooms, up 10 percent in projects and 9 percent in rooms year-over-year.
Upper midscale and upscale hotels accounted for 52 percent of the global pipeline, LE said. Upper midscale stood at 4,463 projects and 567,396 rooms, while upscale reached 3,852 projects and 655,674 rooms. Upper upscale totaled 1,807 projects and 385,396 rooms, and luxury totaled 1,267 projects and 245,665 rooms, up 11 percent year-over-year.
In the first half of 2025, 970 hotels with 138,168 rooms opened worldwide. Another 1,884 hotels with 280,079 rooms are scheduled to open before year-end, for a 2025 total of 2,854 hotels and 418,247 rooms. LE projects 2,531 hotels with 382,942 rooms to open in 2026 and 2,554 hotels with 382,282 rooms to open globally in 2027, the first time a forecast has been issued for that year.
HAMA is accepting submissions for its 20th annual student case competition.
The cases reflect a scenario HAMA members faced as owner representatives.
Teams must submit a financial analysis, solution and executive summary.
THE HOSPITALITY ASSET Managers Association is accepting submissions for the 20th Annual HAMA Student Case Competition, in which more than 60 students analyze a management company change scenario and provide recommendations. HAMA, HotStats and Lodging Analytics Research & Consulting are providing the case, based on a scenario HAMA members faced as owner representatives.
Student teams must prepare a financial analysis, a recommended solution and an executive summary for board review, HAMA said in a statement.
“Each year, the education committee looks forward to the solutions that the next generation of hotel asset managers bring, applying their own experiences to issues in ways that reveal new directions,” said Adam Tegge, HAMA Education Committee chair. “This competition demonstrates that the future of hotel asset management is in good hands.”
The two winning teams will each receive a $5,000 prize and an invitation to the spring 2026 HAMA conference in Washington, D.C. HAMA will cover travel and lodging.
Twenty industry executives on the HAMA education committee will evaluate submissions based on presentation quality, the statement said. HAMA mentors volunteer from September through November to assist teams seeking feedback and additional information. Schools will select finalists by Jan. 15, with graduate and undergraduate teams reviewed separately.
The competition has addressed topics in operating and owning hospitality assets and HAMA consulted university professors to update the format for situations students may encounter after graduation, the statement said.
This year’s participants include University of Denver, University of Texas Rio Grande Valley, Boston University, Florida International University, Michigan State University, Columbia University, Morgan State University, Howard University, New York University and Penn State University.