The San Diego Union TribuneUnion-Tribune recently ran an article last month about the oversaturation of hotels and luxury resorts in downtown San Diego. However, many prominent economists, professors and investment professionals all said no.
Developers that want to build luxury hotels should be doing it at a competitive level. The market determines whether the supply and demand lies. Right now according to mortgage advisors, it's a very difficult time to finance new supply, so those that are making it onto the market are doing quite well. New construction and transactions are slowing slightly, but without a major economic downturn, we shouldn't see in oversaturation of hotels.
Is very little construction over the last 10 years so hotel expansion is actually booming right now. I think it's important to find the balance between private sector developers and hotel firms who manage the operations. Because San Diego is such a major tourist destination widely known for luxury resorts, people come to expect this when visiting.
Again, it comes down to be little construction over the last decade. Many times developers and builders will overshoot the demand but local economists and professors that measure this type of growth do not foresee this anytime on the near or even distant horizon.
According to Kelly Cunningham, of national University systems, "development is not likely to occur with the time necessary for approval and construction, and financial investment constraints keep too much from occurring." Many people feel that the demand for luxury condominiums and properties will be healthy enough to support new hotels and resorts.
According to Gina Champion-Cain of American National Investments, the luxury hotel occupancy is climbing in 2016 showed a record year with capacity and continued absorption. Many tourists are looking for local experience so having options for them is a great investment. Many new hotels offering high-end amenities geared toward attracting locals as well as out-of-town visitors.
What do you think? Do you think we are keeping up with the tourists are over saturating the market with luxury hotels and resorts?
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