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Hotel investment on the rise as the UK is named Europe’s most active market

With London attributing to 63% of sales, there has been a rise in demand from investors seeking to buy a hotel room in London.

“In terms of single asset sales, the UK was the most active market with a total transaction volume of more than €1 billion. In 2011, a total of 32 hotels (more than 5,200 rooms) were sold across the UK in single asset transactions. This figure was driven by London, which accounted for 62% of total single asset investment volume in the UK (15% of single asset transaction volume in Europe),” the 2011 European Hotel Transaction report stated.

Typically dominated by larger investors, the UK hotel investment market has shown great sign of resilience throughout the global economic downturn.

The report continued, “In terms of single asset transactions, the hotel investment market was dominated by institutional investors, hotel operators and real estate investors, which together accounted for 78% of total sales volume. In 2011, private equity companies increased activities and more than doubled their investment in single asset, albeit from a low base. Investment from high-net-worth individuals (HNWIs) declined, possibly due to the lack of landmark hotels on the market in comparison to previous years.”

Furthermore, the European Hotel Transaction report stated that there has been a rise in the number of private investors entering the hotel investment market.

The report highlighted, “Portfolio investment painted a similar picture, which institutional investors, hotel operators and real estate investors accounting for a significant 72% of total volume. Just a handful of transactions exchanged using private equity; however, the size of these investments meant that private equity accounted for a significant 16% of transactions. HNWIs accounted for 12%.”

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For those looking to enter hotel investment, Experience International has a range of high yielding opportunities in London.

For more information about hotel investment, contact Experience International on 0207 321 5868 or email enquiries@experience-international.co.uk.

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