CROSS-BORDER INVESTMENT INTO LUXURY HOTELS POISED TO JUMP .

Contributed by STEPHANY CHEN , SENIOR DIRECTOR , JLL HOTELS & HOSPITALITY GROUP

espite the challenges broader capital markets experienced in 2023 , the global lodging industry demonstrated resilience as revenue per available room soared , surpassing pre-pandemic levels by 12 %.

According to Capgemini ’ s World Wealth Report , the number of high-net-worth individuals ( HNWIs ), defined as those with a net worth of at least $ 1 million , has grown 10.7 % since 2019 , reaching 21.7 million individuals globally at

the end of 2022 . While HNWIs represent less than 0.3 % of the world ’ s population , they contribute nearly 70 % of global spend on luxury travel . As such , it is no surprise that luxury hotel demand has skyrocketed .

Driven by strong fundamentals , rising yields and high discount-to-replacement cost , luxury assets were among the most favored by investors in 2023 . In fact , luxury hotels drove 21.4 % of global singleasset hotel liquidity in 2023 — the second-highest portion since 2015 .

Single-asset luxury hotel pricing reached $ 640,000 per key in 2023 — the highest pricing in global history . There were 32 $ 1-million-plus-per-key transactions — the third most all time — and five $ 3-million-plusper-key transactions — the most of all time .

Urban luxury assets were the most liquid in 2023 , accounting for 62.3 % of single-asset luxury liquidity , the highest portion since 2015 . Cities , including Barcelona , Boston , London , New York , Sydney and Tokyo , all saw increases in luxury hotel

48 hotelsmag . com Mar / Apr 2024