How Badly Will Conference Cancellations Batter U.S. Hospitality REITs?
Multiple corporate events have been cancelled to prevent the spread of the coronavirus. The U.S. hotel sector will bear the impact.
March 5, 2020 | John Egan | National Real Estate Investor
As the coronavirus epidemic intensifies, corporate giants including Cargill, Facebook, Google, Indeed, Intel, L’Oreal, Nestlé and Twitter are dialing back employee travel. Globally, cancellations of major tech conferences have reportedly triggered an economic loss of more than $500 million.
“Companies are taking a conservative approach to travel, especially non-essential trips, and we’d expect this trend to continue in the near term,” says Michael Bellisario, a senior research analyst at investment bank R.W. Baird & Co. who covers lodging REITs.
Depending on how long that trend continues, U.S. lodging REITs could feel a fair amount of financial pain. In the U.S., that’s particularly true for lodging REITs that own properties in popular business travel destinations like New York City, San Francisco, Chicago and Orlando, Fla.
