Navigating Uncertainty: Hotel Real Estate Market Trends in 2025 with John Wijtenburg, Owner of LXK Group

Explore 2025 hotel real estate trends with John Wijtenburg of LXK Group, covering market uncertainty, capital challenges, demographic shifts, regulatory impacts, construction hurdles, and emerging AI innovations

In an era where economic fluctuations and changing consumer behaviors are reshaping the real estate landscape, understanding the nuances of market trends becomes crucial for investors and industry stakeholders alike.

In this exclusive interview, we sit down with John Wijtenburg, Owner of LXK Group, a seasoned expert in private equity real estate with a specialized focus on institutional hotel asset management. With over $100 million in assets under management and involvement in transactions exceeding $500 million, Wijtenburg brings valuable insights from the frontlines of hotel real estate.

Based in Fort Lauderdale, Florida, his firm works extensively with family offices, high-net-worth individuals, institutional investors, and private equity partners seeking opportunities in today's complex market environment.

From capital availability challenges to the rise of experiential travel and the impact of technological innovations, Wijtenburg shares his perspective on the forces shaping hotel investments and development in 2025, offering a window into both the challenges and strategic opportunities emerging in this dynamic sector.

Economic Factors and Market Uncertainty

Q: What are the primary economic indicators currently driving the U.S. real estate market in 2025 (e.g., interest rates, inflation, employment)?

A: Right now, uncertainty is the primary driver. In the travel space, we're seeing both business and leisure travelers waiting longer to book and scrutinizing their spend. Interest rates are important, but capital availability is the biggest limiting factor to deal flow, especially into hotel equity investments.

Housing Supply and Hotel Conversions

Q: How is the ongoing housing supply shortage affecting home prices and affordability across different regions in the U.S.?

A: As hotel investors, we're not too focused on housing supply, but we see a tremendous opportunity to support affordable housing stock and hotel markets by converting older hotel inventory. Many of larger properties in secondary markets are still capital-starved since the pandemic.

Demographic Trends and Consumer Behavior

Q: In what ways are demographic shifts (e.g., aging population, remote workers, Gen Z buyers) influencing real estate demand and investment trends?

A: Experiential travel is everything these days. The major brands recognized this and are investing heavily in lifestyle and extended stay brands. Millennials coming of age as leaders in the workforce and their Baby Boomer parents are driving much of this demand. Tighter travel budgets and the popularity of cruises are also seeding a trend for more all-inclusive experiences in the US.

Regulatory Environment and Development Incentives

Q: What impact are government policies and regulations (such as zoning laws or tax incentives) having on housing development and real estate investment?

A: In Florida, the Live Local Act has been helpful for incentivizing more affordable housing development.

Construction and Development Challenges

Q: What challenges are real estate developers and investors facing due to construction costs, labor shortages, and supply chain issues?

A: Tariff uncertainty is holding up new construction projects right now. Many of these have already secured financing – equity and debt – but those with tighter underwriting are being held up.

Technology and Innovation in Real Estate

Q: How are technological innovations and data analytics reshaping real estate transactions, property management, and market forecasting?

A: Middle-market real estate investors are leading the charge with innovative technologies. The institutional players are slow to adapt, and private capital generally doesn't have the resources to invest heavily in this area. Right now, most of the technology is still focusing on general-purpose generative AI, but we're expecting new purpose-built AI to work its way into many common applications, streamlining operations, in the coming years.