Betting on the Long Stay: Inside Noble's Extended-Stay Strategy
by: Rob Schneider (Originally published by Skift)
Skift Take
With other investors sitting on the sidelines, Noble is buying hotels from REITs and overleveraged owners at a discount — and betting that extended-stay demand will outlast the current rate headwinds.
While hotel deal activity has been sluggish, Noble Investment Group has been busy acquiring almost 150 hotels over the past 18 months (124 last year and 25 so far in 2026).
Among the bets: branded long-term accommodations, value-add upscale select-service, and upscale extended-stay hotels.
“We believe in the long-term secular demand trends,” said Noble Founder and CEO Mit Shah.
Shah said he hasn’t seen many new development deals that have penciled in the past five years, but said these do and can be built to a 10x unlevered yield, meaning the property generates enough debt-free cash flow to pay back the purchase price in 10 years.
“We’ve seen a tremendous opportunity to acquire assets, everything from REITs to individual owners with scale, and then build out a new development platform that works,” Shah said.
“That’s the opportunity where you build these, you solve for a piece of the marketplace that you know is there,” he said. “You can build them and have immediate yield to them, and now you can bolt them on with scale and you [eventually] can sell them to a yield-oriented buyer.”
Those trends have held up in 2026 despite a noisy environment as hotels enjoyed RevPAR growth of 3.8% in the first quarter, according to CBRE. The numbers have been so strong that CoStar and Tourism Economics recently increased their RevPAR forecast for 2026 from a conservative 0.6% to 2.8%, driven by projected gains in occupancy and ADR.
Extended-stay has recently outrun traditional hotels in performance. May’s total extended-stay hotel room revenues were up 7.9%, according to The Highland Group. The segment has also broadly outperformed comparable traditional hotels in the economy, mid-price, and upscale segments in demand since the start of the year, based on CoStar data.
How Noble Makes Deals
So why is Noble able to make this many acquisitions at a time when other investors have shied away? It’s a combination of factors, according to Noble’s chief investment officer, Ben Brunt.
Most of the deals have included portfolios with multiple properties and involve sellers that the company has known for years.
“If they know that they can execute 14 assets in one fell swoop versus having to go individually, or if they have some kind of time constraint, we’re a good option,” Brunt said.
The capital is coming from the company’s $1 billion Noble Hospitality Fund 5, which closed in December 2023.
The result is Noble acquiring hotels in high-growth markets (its portfolio is heavily focused on the Sunbelt, but its extended-stay purchases are located across the country) with multiple demand drivers (like medical, education, data centers and short-term housing for infrastructure spending projects) at a significant discount to replacement versus building newer ones.
Part of Noble’s approach to branded long-term accommodations involves buying existing extended-stay hotels and flipping the operating model so that two-thirds of the guests are staying 30-plus nights.
One of the biggest issues with the recent extended-stay boom is that owners often don’t have the discipline to book only long-stay customers — they look to fill occupancy with shorter-term customers for immediate gains. It’s a quick boost but the long-term returns depend on the economics of extended-stay guests.
Another part of Noble’s approach involves developing new-build brands with Marriott (StudioRes) and Hilton (LivSmart Studios). Noble has already broken ground on 10 StudioRes projects. The company is currently developing three LivSmart properties, two in Florida, which are scheduled to open in 2027, and a third in Georgia, in the early stages of development.
Still, the approach doesn’t come without risk for Noble, even with a shorter-than-average hold time of five years for the assets. There is always a chance of more noise and headwinds in the second half of 2026 as the long-awaited interest rate relief has yet to materialize and could head in the opposite direction amid inflation fears. But Shah remains optimistic about the current deal environment for Noble.
“We believe that this is going to be one of the strongest markets where opportunities become available,” he said, noting that after the Great Recession, Noble’s best years were in 2014-15. He said owners are now exhausting their ability to extend loans or defer renovations and capex, so they are forced to consider recapitalizing.
https://skift.com/2026/07/02/noble-investment-groups-extended-stay-bet-is-behind-a-149-hotel-buying-spree/