National CRE News In Your Inbox.
Sign up for Connect emails to stay informed with CRE stories that are 150 words or less.
Fitch: Hotel RevPAR Will Take Five Years to Rebound
With RevPAR not expected to fully recover for five years, Fitch Ratings said it would continue the Rating Watch Negative (RWN) assessment for all Fitch-rated U.S. CMBS single-borrower hotel transactions. “The current uncertainty surrounding the severity and duration of the coronavirus pandemic and its impact on the hotel sector is precluding the removal of the RWN,” according to Fitch.
The ratings agency predicted “an unprecedented decline in hotel revenues” this year.
Fitch is forecasting that trailing 12-month RevPAR revenue “will not recover to its prior cycle peak in nominal terms for approximately 60 months.”
However, as hotels reopen and if there’s sustained recovery in revenues from the current trough, Fitch anticipates it will be able to resolve the RWN status on senior bonds.
“These actions will occur in stages as the recovery gains traction and will be on a deal-by-deal basis over the next six months,” Fitch reported.
For comments, questions or concerns, please contact Paul Bubny
- ◦Financing
