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New Tax Law Holds Favorable Prospects for Commercial Real Estate; Potential to Boost Space Demand and Capital Flows
Located on the Atlantic seaboard, the Charleston metro encompasses Charleston, Berkeley and Dorchester counties in southeastern South Carolina. A favorable business climate is helping to draw companies and workers to the region.
The economies in the Carolinas are growing and will support a small gain in regional occupancy this year. Aided by growth in key segments associated with inbound business travel and popular leisure destinations, including up-and- coming Greenville, hotels in South Carolina seem positioned to outperform their counterparts in North Carolina.
Construction impacts hotel sector. After touching a cycle high in annual occupancy last year, the rate will recede in 2017 as developers accelerate hotel openings. Beyond this year, however, construction in the region consisting of Alabama, Arkansas, Louisiana and Mississippi should moderate.
Scattered sunshine in the near-term outlook. Statewide supply growth will contribute to a decline in annual occupancy in Florida and a further moderation in the increases in ADR and RevPAR. Last year’s performance was attributable to a mix of slowing economic growth, Zika and a hurricane, plus other high-profile events that suppressed travel to the state.
No movement forecast in full-year occupancy. The growth rates in occupied rooms and room supply converge, leaving the full-year occupancy rate in the Mid South states of Kentucky and Tennessee unchanged in 2017.