Inside Look: Our Hunter Conference 2023 Experience

Dear valued LinkedIn community,

We are delighted to share our recent experience at the Hunter Conference 2023 with you. This event brought together some of the brightest minds in the hospitality industry for three days of thought-provoking discussions, innovative ideas, and invaluable networking opportunities. We at LXG believe that staying ahead of the curve is key to success in the commercial real estate and hospitality industry. Attending this conference gave us the insights and connections to do just that.

One of the key discussions at the conference was the recent collapse of SVB, a bank with many Silicon Valley deposits pulled from under them at a moment’s notice. While the collapse of SVB and other banks is not a reason to panic in the context of commercial real estate, it is expected to tighten lending. As such, it will be challenging to obtain new construction loans in 2023 unless the project is in a high RevPAR market that has historically been stress tested.

Furthermore, it was also discussed that construction costs are not coming down anytime soon and are expected to continue increasing due to lingering supply chain issues. The underwriting rates are also predicted to be in the range of 4.5-6% over the next two years. Moreover, revenue management is key in today’s market to drive cash flow and valuation. Pricing certain rooms for a premium to drive ADR is essential for any successful hospitality business.

It is also worth noting that insurance rates are expected to increase significantly in the coming years. Properties on "sand" are expected to increase 2-3x. Additionally, since the Fed increased interest rates, property values have decreased by 25%. However, certain properties have increased operational efficiencies and net operating income by more than 25%, increasing their property value.

Finally, there was a unanimous agreement among large companies and team leaders that being in person is essential for team building and efficiency. While the pandemic has forced many to work remotely, most hospitality companies are now 100% back in the office. The continued "Flight to Quality" also means that offices in Class A locations will perform well.

At LXG, we understand the importance of staying on top of these trends and challenges to serve our clients and community better. We remain committed to creating inclusive spaces that revolutionize the guest experience through our expertise and unparalleled real estate developments.

During the conference, we had the delight of networking with distinguished leaders in the hospitality industry, such as Krishna Paliwal, President of La Quinta and Hawthorn Brands, and Head of Architecture, Design, and Construction at Wyndham Hotels & Resorts; Ryan McNamara, Vice President of Development at Hyatt; and Jason Gregorek, Vice President of Development and Owner Relations at Hyatt. It was inspiring to hear their innovative ideas and share our own expertise in hospitality and commercial real estate.

It was inspiring to hear their innovative ideas and share our own expertise in hospitality and commercial real estate. At LXG and Level Hospitality, we remain committed to revolutionizing the guest experience by transforming spaces through our expertise and creating unparalleled real estate developments.

In conclusion, the Hunter Conference 2023 was an enriching experience for LXG and Level Hospitality. It highlighted the current trends and insights in the commercial real estate and hospitality industry, and we feel better equipped to navigate the challenges ahead. We look forward to continuing our journey towards excellence and shaping the future of the hospitality industry with our passion for creating more inclusive spaces for communities and patrons alike.

Stay attuned to our upcoming newsletter for updates on our endeavors and the latest trends shaping the dynamic landscape of the real estate industry.

Best regards,

LXG.