What's the Value of Today's Hotel Property Exit Cap Rate?

At the end of October 2012, president of PKF Hospitality Research Mark Woodworth and senior advisor Jack Corgel,  professor of real estate at Cornell University, discuss the outcome of the Federal Reserve's continued monetary policy of quantitative easing and its impact on current hotel property value.

In discussing the exit rate for hotel owners, both postulate that Treasury rates will increase and that the 7 percent cap for hotels will need to be a 9 and a half to 10 percent for the terminal rate, which would mean a lower present value on exiting properties now.