A Toronto-based investment company continues to gobble up hotels in the honeymoon capital with K2 Group announcing a fifth hotel purchase in the Niagara Falls region.
K2 Group, which repositions hospitality, petroleum and real estate assets across Canada, is reaching across the border to buy a property on the U.S. side of Niagara Falls, which attracted 831 million US dollars in tourism in 2021, a 9.3% increase from 2019 before the pandemic. The deal marks K2 Group's first on the U.S. side of Niagara Falls.
K2 did not disclose a price for the Holiday Inn Express & Suites hotel at 10111 Niagara Falls Blvd. but said it plans to spend US$3 million improving the four-story property by renovating both the exterior and interior of the hotel, as well as upgrading all guestrooms to InterContinental Hotels Group's latest standards.
"We are confident in the strength and continued growth of the Niagara Falls region as a popular, dynamic vacation and business-travel destination. We are excited to have found a great value-add hotel opportunity on the American side of Niagara Falls. This property is already one of the best performing hotels in the area, and we expect to improve its performance even further with renovations, expected to be completed in the fourth quarter of 2023," said Kailash Kasal, president of K2 Group, in a statement.
Holiday Inn Express & Suites is located across the street from Niagara Falls International Airport, just six miles from downtown Niagara Falls. In April, K2 Group bought the Choice Hotel Canada's Quality Inn & Suites in Niagara Falls, Ontario.
Kasal called Niagara Falls a high-growth market and believes the latest deal fits his company's strategy.
"As one of Canada's top investment groups, their proven track record and development plans for the Holiday Inn Express & Suites will further enhance the visitor experience in Niagara Falls, USA," said Robert Restaino, mayor of Niagara Falls, New York, in a statement.
The Ontario side of the falls has traditionally attracted more tourists, reaching about 12 million of the 14 million visitors annually to the region.
Colliers Hotels said lodging investment picked up in the second quarter across Canada with about 25 transactions, more than double that of the first quarter but warned that might not continue throughout the year.
"What was anticipated to be a relatively strong year for hotel investment will likely be softened by a rising interest rate environment," said Colliers in a July report. "Given overall positive operating fundamentals, there is still a diverse range of lenders committed to the hotel space, and capital is available for strong sponsors and quality assets."