MONTH IN REVIEW
MONTH IN REVIEW
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INVESTMENT
Scotland H1 hotel
investment is
‘double’ whole of
2017
Investment into Scottish hotels in the
first half of 2018 reached £389.6m,
double the total annual investment
volumes recorded in 2017 (£195m).
Investment was spread across
10 individual transactions and the
components of seven portfolios,
with the individual sales principally
focused in the £1-10m price bracket,
according to real estate advisor
Savills. The Caledonian Waldorf
Astoria Hotel in Edinburgh was the
only transaction above this bracket,
achieving a sale price of £85m.
UK buyers were the biggest buying
group, accounting for 41% of activity,
followed by Middle Eastern investors
(22%), Israeli investors (16%), US
investors (8%), Canadian investors
(7%), Singaporean investors
(5%) and German investors (1%).
Collectively non-domestic investors
continue to be the dominant player
in the market.
Steven Fyfe, associate director at
Savills Glasgow, said: “Investment
volumes continue to build on the
strong level of appetite we witnessed
last year as we find ourselves already
surpassing last year’s total annual
volume at the half year point.”
Martin Rogers, head of UK hotel
transactions at Savills, added:
“ This year has got off to a strong
start, driven by several high profile
portfolio transactions. Looking ahead
we expect the market to remain
active and predict the total for 2018
investment to reach around £5.4bn.
“ The UK hotel market remains
attractive to both domestic and
overseas investors, providing
something for everyone due to the
range on offer from single regional
hotels to trophy assets in London.”
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ACQUISITION
Easyhotel
completes
Cardiff leasehold
acquisition
and announces
pipeline plans
EasyHotel has confirmed the completion
on the acquisition of a leasehold in
Cardiff for a 120-room hotel after it was
granted planning permission.
The hotel group also announced a
further 174 rooms made up of five under
development by its Swiss franchisee.
The group announced on 30 October
2017 the acquisition of a freehold site
in Cardiff with planning permission for
a 120-bedroom hotel having now been
granted. Development work for the new
purpose-built site, which is located at
Fitzalan Place, close to Cardiff Queen
Street Station will now begin and the
hotel is anticipated to open in the
2019/20 financial year.
The group also confirmed that it
has signed an agreement for the
development of a further 174 rooms
in Switzerland with four hotels to be
developed in Zurich and a further hotel
in Basel.
The hotels are being developed by
the Group’s Swiss franchisee and are
anticipated to open over the course of
the next 14 months.
Providing a pipeline update, Easyhotel
said in a statement: “EasyHotel Belfast
will open on 10th August, taking the total
number of hotels in the group’s portfolio
to 29. With the addition of the new hotels
in Switzerland, the Group’s development
pipeline currently includes 1,280 owned/
lease rooms and a further 1,956 franchise
rooms now under development.”
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Investment volumes continue
to build on the strong level
of appetite we witnessed
last year as we find ourselves
already surpassing last
year’s total annual volume
at the half year point
Steven Fyfe, associate director,
Savills Glasgow
BUSINESS PERFORMANCE
‘Record-breaking
performance’
for London hotel
sector in July
London’s hotel sector experienced
record-breaking levels in average daily
rate (ADR) and revenue per available
room (RevPAR) in July.
Both the ADR and RevPAR levels
were the highest for any month
according to data from benchmarking
and analytics firm STR. According to
the group performance for July 2018
topped the levels achieved in July
2012, when the market was hosting the
opening days of the summer olympics.
Based on daily data from July,
London reported the following in year-
over-year comparisons:
n Supply: +2.0%
n Demand: +6.1%
n Occupancy: +4.0% to 91.2%
n Average daily rate (ADR): +4.7% to
£171.25
n Revenue per available room
(RevPAR): +9.0% to £56.15
STR analysts attribute the strong
performance to an “unseasonably warm
summer”, as well as popular events
including Wimbledon and London Pride.
A statement by the STR said:
“Following a record-breaking first half
2017, hotels in the U.K. capital have
since seen a slowdown in performance,
mainly due to strong ongoing supply
growth. This July performance followed
a 1.5% increase in RevPAR in June 2018,
indicating a summer upswing.”
September 2018