Hotel investment is a popular choice for real estate investors looking to diversify their investments and reap the rewards as a much lower maintenance option than a residential purchase, and it seems the UK is the most popular place to invest.
Both international and local investors are continuing to flock to the UK to make investments in the hotel sector, according to a recent study by CBRE, as the country retains the top spot as the most-sought after place to invest in Europe – ahead of Germany and Spain.
The European Hotel Investor Intentions Survey revealed that 35% of respondents said the UK was their main hotel investment location, which was 106% more than 2017, while Germany was the top choice for 18% and Spain came in third place with 16%.
Last year, the UK attracted a record £5.3bn in investment into hotels from investors both in the UK and abroad, which was the most invested out of any European country and a 39% jump on the previous year’s levels.
Branching out across the country
However, while London generally dominates the hotel investment sector as the top place for international investors, it seems that it is hotels outside the capital that have been gaining strength and popularity for investors.
Paul Collins, head of hotel investment properties for UK & Ireland at CBRE, said: “The UK is attracting a wide range of international investors seeking opportunities in key cities such as London, Manchester and Edinburgh.
“Investor appetite for quality regional hotels will remain resilient and despite the UK’s impending withdrawal from the European Union, our survey results suggest that any restrictions to the growth of UK investment volumes are more likely to be because of restricted supply rather than a reduction in demand for hotel assets.”
The survey showed that 38% of investors are focusing on “gateway cities”, with capital cities attracting slightly less of the investment (36%) followed by secondary cities (16%) and resort locations (9%). But the industry as a whole is growing as more property investors look to diversify their assets, with 94% of respondents saying they intended to either match or increase their current hotel investments over the course of this year.
To read about the benefits of hotel investment, click here.
