In fact, PKF hospitality research recently affirmed its strong forecast of RevPAR growth, projecting RevPAR for U.S. hotels will increase 6.6 in 2013, and 7.8% in 2014. As a result, we are very bullish on the upside potential of this lodging cycle.

We believe this remains a very appealing time to invest in lodging stocks. We are still early in the cycle, perhaps about a third to a half of the way through, what we seek to be an extended period of growth.

Additionally, we expect history to repeat, mainly that this lodging cycle peak will exceed the prior peak in terms of RevPAR, EBITDA and hotel values.

A key driver for this healthy lodging recovery is the lack of new supply. Construction financing for lodging remains very difficult to obtain. While we have commented on this favorable demand, supply and balance before, the significance cannot be under estimated. The forecast for PKF in this regard have remained unchanged, projecting new supply growth for 2012, 2013, and 2014, a .5%, 1.0%, and 1.6% respectively.

New supply is expected to remain on average well below 2% annually, through at least 2016, which is less than the average annual change in the nations lodging supply, from 1988 through 2011.

For the foreseeable future, U.S. hotel demand is expected to significantly outpace available supply. If you consider that lodging is already reaching peak demand levels in many submarkets, the absence of new hotel rooms coming on in that market, should lead it to high room rates.

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