Hotel investment volumes in the UK and four Continental European countries fell overall last year by 5% to €6 bn, according to figures from BNP Paribas Real Estate.
Hotel investment volumes in the UK and four Continental European countries fell overall last year by 5% to €6 bn, according to figures from BNP Paribas Real Estate.
Looking ahead, 2013 is expected to be a repeat of 2012, the adviser said. Aside from the UK, the survey covered France, Germany, Italy and Spain.
While investment volume slipped overall in the five countries polled, France was a notable exception with €1.8 bn invested during 2012, marking a year-on-year increase of 59%.
In H2 2012, the UK continued to dominate the hotel investment market at 41% of overall investment amongst the top five markets. Hotel investment volume in the UK totalled €2.5 bn in 2012, reflecting a 31% drop compared to the same period a year ago.
Even though declining, the UK remains the most liquid hotel investment market in Western Europe, the adviser added.
Activity in the regional markets remained quiet, with London still the main target of investors, in particular overseas investors. These cash-rich investors continue to focus on prime assets regardless of their high cost per key and low yields.
German hotels stood out with a 5% rise of their revenue per available room, whilst Spanish hotels performances deteriorated over 2012, weighed down by sluggish domestic tourism. Similarly, revenue per available room in Italy declined, although average daily rates remain high, above €100.
