In recent years, suburban areas have undergone significant transformations, becoming bustling business hubs that offer amenities comparable to urban centers. This shift has made suburban hotels, like the newly built TownePlace Suites by Marriott in Houston Tomball, increasingly attractive investments. The strategic location of these hotels, combined with robust local economic growth, has contributed to their rising demand. The sale of TownePlace Suites, an 89-key property built in 2024, exemplifies this trend, highlighting how suburban hotels cater not only to business travelers but also to weekend visitors, including those attending weddings and other events.
Proximity to Major Economic Drivers
The TownePlace Suites by Marriott Houston Tomball is situated near key transportation routes, including State Highway 99 and FM 2920/Waller-Tomball Road, offering easy access to numerous retail outlets and residential developments. This strategic location makes it an ideal choice for travelers seeking convenience and comfort. Tomball, located within Greater Houston, has emerged as a significant business hub, boasting over 1,500 businesses and nearly 14,000 employees. Notable economic drivers in the area, such as the Tomball Town Center, Tomball Regional Medical Center, and corporations like Baker Hughes and VEOLIA, further enhance the hotel’s appeal. These factors collectively contribute to consistent weekday demand from business travelers.
In addition to business-driven demand, the area sees a substantial influx of weekend visitors, particularly for weddings. The diversity of demand sources ensures that suburban hotels like TownePlace Suites remain steady in occupancy rates throughout the week. This multifaceted demand makes suburban hotels attractive investments, offering a balanced revenue stream. Given the proximity to numerous economic drivers, these hotels benefit from a constant flow of guests, reducing the risk associated with fluctuating occupancy often seen in purely leisure or business-focused hotels.
Growing Interest in Suburban Markets
The robust operating performance of suburban hotels has piqued the interest of investors, as evidenced by the swift sale of the TownePlace Suites. Eric Guerrero, Senior Managing Director & Partner at HVS, noted the strong buyer interest in Houston’s suburban markets, attributing it to the area’s economic growth and the hotel’s performance metrics. The property was marketed during its final construction phase and managed to secure a buyer within a month, with the sale closing shortly after its opening.
The involvement of HVS Brokerage & Advisory played a crucial role in the sale, providing comprehensive support from the economic feasibility study to finalizing the transaction. The team, including Eric Guerrero, James Rebullida, Fadi Rawashdeh, and Kyle Peterek, ensured a smooth process despite the challenges of selling a hotel still under construction. This example underscores the growing confidence among investors in suburban markets, recognizing their potential for high returns compared to more saturated urban areas. The increasing interest in these markets is driven by the combination of strong local economies, diverse demand sources, and competitive operating performance.
In conclusion, the sale of TownePlace Suites by Marriott Houston Tomball highlights the growing attractiveness of suburban markets around Houston, driven by economic growth and strong demand. The involvement of HVS was pivotal in facilitating the transaction, demonstrating their expertise in handling complex sales scenarios. The trend of investing in suburban hotels is likely to continue as these areas develop further, offering lucrative opportunities for investors and meeting the diverse needs of modern travelers.
