In December, hotel-industry veteran Jon Bortz raised $405 million from investors to buy hotels at distressed prices.

Last month, Mr. Bortz’s Pebblebrook Hotel Trust committed to spend most of that money, pledging $372 million in separate deals to buy five upscale hotels, including the Sir Francis Drake in San Francisco and the Doubletree Bethesda Hotel in Maryland.

Mr. Bortz’s flurry of buying illustrates that hotel sales are beginning to revive after a two-year drought. In the first four months of this year, 78 hotels traded hands for a total of $2.2 billion, according to Real Capital Analytics. That compares with 52 deals for $888 million during the same period last year.

Part of the reason: Distressed properties are working their way through the workout and foreclosure process. Real Capital calculates that 42% of the hotel deals so far this year involved properties with distressed debt, meaning they were delinquent, foreclosed or otherwise under pressure from their lender. That compares with 11% last year and 1% in 2008.

To be sure, transaction volume and values are still far off their highs. In the first four months of 2007, for example, some 470 hotels were sold for $17.7 billion, Real Capital says. Values are up about 40% from the lows they hit last year, according to estimates by Green Street Advisors Inc. Still, they are 35% below the highs they hit in 2007, Green Street says.

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