In my year-end missive following 2023, I reviewed the hotel transaction market dynamics comparing contrarian buyers to downhill skiers who don’t want to follow in other’s tracks and “wanna-be’s” to cross country skiers who predominantly follow the leader’s tracks. I simply could not understand why more investors were not placing bets on the inefficiency created by market noise when market stakeholders intuitively know that you should always buy when others are not. Well, other than one huge investor in the market, SQ Capital, Inc., 2024 logged in another down transaction year, as hotel transaction volume fell more than 10% after last year’s calamitous 40% decline. For the second year in a row, SQ Capital was by far the largest investor in the market.
