The price performance of hotels continues to lose momentum, with all regions posting lower year-over-year and quarter-over-quarter performance relative to the previous period. While performance was weaker for hotels in both gateway and non-gateway cities, hotels in the non-gateway cities fared better than those in the gateway cities. While transaction volume declined on a year-over-year basis, transaction volume was up quarterly for small hotels and hotels in non-gateway cities. Based on moving averages, a sell signal is indicated for large hotels, while a buy signal applies to small properties. That said, since the standardized prices of both large and small hotels have softened, this situation calls for keeping your powder dry. Although interest rates for both Class A and Class B&C hotels fell 74 basis points (bps) this quarter, hotel interest rates are higher by 45-50 bps relative to June 2022. Moreover, the delinquency rate on hotel loans rose this quarter. As in the prior period, borrowing costs still exceed returns on hotels. Based on our leading indicators of hotel price performance, we can expect to see hotel prices continue to falter next quarter. This is Volume 12, Issue 2 of the CREF Hotel Indices.