Hotel Deals Are Moving Again. Here’s What’s Driving Them

Glenn: [00:00:00] Hey, everybody, it’s your hospitality friend Glenn at Lending Con 2026 where I found my friend Dan Lesser. You might know him from LW Hospitality Advisors, but first I want to thank my friends who are Actabl. Actabl, they give you the power to profit. Check them out at actabl.com. How are you doing, man?

Dan: [00:00:15] I’m fantastic. How are you?

Glenn: [00:00:16] So great to see you. It was fun watching you on stage. Thank you. This morning as we’re recording this, you’re always bringing me those insights that you know, I have no idea what’s going on. So I’m curious to how you see the state of things today in the hospitality market and where people can find an opportunity and the advantage.

Dan: [00:00:34] So it’s very interesting. The hospitality market is actually doing quite well in spite of some things.

Glenn: [00:00:40] I don’t understand. I just did a piece with our friend Bruce Ford and I’m like, I’m confused because everything is supposed to be horrible right now, but it’s not. And I don’t, I don’t understand.

Dan: [00:00:50] Well, if you think about what happened the last half of last year, the industry metrics were not looking very good. And the prognosis by most folks going into the new year was that this year was not going to be a good year, particularly the first half of the year. Turns out that this first half of the year has been phenomenal, obviously boosted somewhat by the by the World Cup. Right. But fundamentally, listen, people are traveling, okay. And I think Covid was a real game changer for many in terms of coming to the realization that life can be short.

Glenn: [00:01:24] It’s a great point.

Dan: [00:01:25] So enjoy it while you’re here. And so remember that notion of revenge travel. Yeah. Right. I don’t think it’s gone away.

Glenn: [00:01:32] No, I don’t think it’s gone away. But I wish the term revenge travel would go away.

Dan: [00:01:35] Yeah, I agree with you.

Glenn: [00:01:36] It’s a stupid term, right. But we’re very good at making up stupid terms here in the United States.

Dan: [00:01:41] Uncertainty is another good.

Glenn: [00:01:42] Yeah, right. Uncertainty. Uncertainty. Right. I love what you said that you said on stage today. I mean, the uncertainty thing is dumb. And the other thing I can’t stand is when they say, well, we have to wait till the next administration.

Dan: [00:01:55] That’s a cop out, right? Absolutely. Right. Absolutely.

Glenn: [00:01:57] All right. So what are you thinking about now then, in terms of opportunity. Obviously, people are traveling. My belief is that other sectors are going to continue to hurt because the reality is people want to travel. For decades, we’ve been saying people think it’s a fundamental right to travel. I think you’re right. Covid has brought all that to the fore and we’re now living that existence. So where’s the real opportunity for hoteliers to leverage this market that seems to be going contradictory to the rest of the economy?

Dan: [00:02:28] Well, I think we’re starting to see it in the transaction market in that it’s interesting, we’re seeing some very large, substantial transactions, and then we’re seeing quite a number in the middle and below. There’s a ton of money out there, all types of financing. Yeah. There’s refinancing proceeds. There’s there’s acquisition money and there’s construction financing for deals that make economic sense.

Glenn: [00:02:55] Yeah, yeah. It was really good to hear you say that this morning and to tell our friends here that as well. So does that mean we’re officially the money’s no longer on the sidelines? It’s actually in play. Because for the last 30 years, I’m hearing sideline sidelines.

Dan: [00:03:06] I’m not so sure it really was Evans sidelines. Listen, everything makes sense. Yeah man. Everything makes sense at the right basis. Right. And we’re seeing that now with a lot of trades that are going on. You have you have existing sponsors who are faced with debt maturities that were originated three, five, seven years ago at much lower interest rates. Right. Right. And so they’re facing a refinance at much higher cost of capital and coupled with the need to renovate. Yeah. Right. Anybody who hasn’t renovated, you know, during Covid, that party is over. Okay. Brands are coming down and it’s got to be done. So we’re seeing lots of sponsors between those two phenomena debt coming due. That’s going to cost a lot more. And the need for capital there. Like you know what? I’m done right. Get rid of.

Glenn: [00:03:55] It. That’s fueling properties, trading hands, that’s fueling conversions and all of that kind of stuff. And one of the things that I’ve noticed over my decades in this career is how like really interconnected things are, and the yin and the yang of our business, like renovations happen. You know, in a time when like new builds aren’t necessarily happening, new builds happen when renovations aren’t really happening. I really kind of love that dichotomy. So there’s always a place, I think, to make money in our business 100%.

Dan: [00:04:22] And what’s interesting in my practice is that we, as long as there’s activity transaction activity out there, we’re busy for quite some time now, we’ve been very busy on one end of the spectrum doing feasibility work for proposed new projects. And at the other end of the spectrum, truly distressed assets, bankruptcy related. And then a ton in between. Right. There’s opportunity at every, at every point. And it’s, again, it’s all about your basis, right? What, what is, what is, what is your cost to get into the deal? Right. And we’re seeing repricing, quite frankly.

Glenn: [00:05:01] Yeah. And it’s really, it’s, it’s definitely an issue of the haves and have nots in that sense. And I was looking, I was, did some interviews while we were at the NYU conference with some hoteliers. New union laws are coming into effect, which changes the financial dynamics in that particular market. So some hotels that have no debt are in a much better position than hotels that do have debt because of the rising expenses. And my imagination is that it’s the same thing around the country. It doesn’t have to be union related, but there’s definitely the people that are in a better position than others to leverage this particular market.

Dan: [00:05:31] 100%. Yeah, 100%.

Glenn: [00:05:33] Yeah. Interesting. Anything else I need to know that I don’t know

Dan: [00:05:37] Anything else that you need to know? This guy is the greatest animated pontificator in the space.

Glenn: [00:05:46] Hey, thanks. I really appreciate that. All right, all right, how do we learn more about you guys?

Dan: [00:05:50] You can find me on the web. My cell number is (516) 456-6959.

Glenn: [00:05:57] Nice, and I’m A 917 number. He’s got a Long Island number, so obviously he’s cooler than me. He’s Dan, I’m Glenn like, share, subscribe, all that kind of good stuff. Thanks. Check him out.com. See you later. Bye. Thank you.