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30 September 2015, London: Transactions in the European hotel sector have seen a big increase with volume reaching €12bn in the year to date, according to Charles Human, HVS managing director, speaking yesterday [29 September 2015] at the Hotel Investment Conference Europe at London’s Jumeirah Carlton Tower.

Introducing a session on private equity, Human painted a positive outlook of today’s hotel investment sector, outlining the fact there had been a 58% year-on-year volume increase.

The UK, he said, had seen the biggest number of deals, with €6.8bn-worth, representing 55% of total European volume. Some €5.2bn had been portfolio deals, with well over €1bn still pending.

Spain was the second best performing country, with hotel investment growing 93% year-on-year, totalling €1.1bn, around 9% of total European volume.

“The market is stronger than it was a year ago with the upturn driven largely by continued recovery combined with increased liquidity,” said Human. “We are now seeing much more interest from investors in the hotel sector and we expect this to continue.

“Since the start of 2014, around 20% of total group-owned or managed UK hotel stock has changed hands. That could rise to nearly 30% by the end of the year,” he said.

“The all-Europe average hotel cap rate stood at 6.1% last year and has decreased to 5.9% this year, indicating continued yield compression, while PE funds accounted for 25% of all European purchases in 2014. The ratio is up to 35% this year – the most active investor category and predominantly driven out of the US.”

Asian buyers have accounted for around 15% of all acquisitions since the start of 2014.

 

About HVS

HVS is the world's leading consulting and services organization focused on the hotel, mixed-use, shared ownership, gaming, and leisure industries. Established in 1980, the company performs 4500+ assignments each year for hotel and real estate owners, operators, and developers worldwide. HVS principals are regarded as the leading experts in their respective regions of the globe. Through a network of more than 35 offices and 450 professionals, HVS provides an unparalleled range of complementary services for the hospitality industry. HVS.com

Superior results through unrivalled hospitality intelligence. Everywhere

Contact: Charles Human, Managing Director

chuman@hvshwe.com / +44 (0)207 878 7771

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