I'm sure people will argue this one, but my nominee is the hotel/hospitality sector. It has really been taking a beating in this recession. Here in Chicago, a few hotels near ORD have closed and others are practically giving away rooms. Even luxury hotels are not immune, as evidenced by the recent announcement that the Ritz-Carlton Lake Las Vegas would shut down in early May.There has also been news that some properties are being sold for a fraction of their previous value, while others are just going back to the lenders.
I think the watchword in the business right now is hang on for dear life and then try to pick up the pieces on the cheap at the bottom. Just remember, if you are buying a hotel (or selling one for that matter), make sure you have a dirt lawyer who has actually done a deal or two. And that lawyer should work closely with business folks at the client to look over potential pitfalls and work through legal issues that are more or less unique to this industry, or at least to franchised or licensed businesses.
Assuming a recovery takes place there could be some real opportunity here, especially on the resort end. The one area I worry about most is the business hotel, as I wonder when or even whether business travel will ever go back to what it once was. Case in point: back in the old days real estate lawyers had to be on site at closings or to help with due diligence, sometimes for days or even weeks on big deals. That still happens sometimes, but as often as not you can work from your office or even your home thanks to email, PDFs, electronic war rooms, a BlackBerry and other technology. Even overnight delivery sometimes seems quaint.
If anyone has any more expert thoughts on the hospitality sector, by all means share them. Once again I am not trying to crystal ball here, but I do wonder how and when this sector recovers.