hit tracker
Friday, March 29, 2024
HomeLatest NewsHotel investment reached 3,230 million due to the reactivation of tourism

Hotel investment reached 3,230 million due to the reactivation of tourism

Date: March 29, 2024 Time: 18:11:03

Investment in the hotel sector in Spain last year reached 3,230 million euros, becoming the third best year behind 2017 (3,900 million) and 2018 (4,860 million), years that saw large portfolios especially lavers winnowed , according to data from Christie & Co, an international consultancy specialized in the hotel sector.

In its annual analysis of investment in Spain corresponding to the year 2022, which reflects the key activity of the market, the trends and the challenges of 2022, the consultancy estimates that the rooms transacted last year were close to 20,000, which reached a price of 170,000 euros. , 16% higher than 2021 and 20% higher than 2019.

This was mainly due to the sale of numerous ‘trophy’ assets in ‘prime’, such as the acquisition of 51% of the Bless Hotel Madrid and Rosewood Villa Magna by Sancus Capital, the purchase of the 7Pines Resort by of Engels & Völkers or the sale of the Hotel Iberostar las Letras.

The desire to travel, the greater capacity to save and the reduction of restrictions caused international demand to reactivate in the second quarter of 2022. hotel investment in sun and beach destinations, which, together, registered 56% of the total volume invested during 2022.

Likewise, international brands and the repositioning of hotels reinforced investors’ commitment to the 4 and 5-star categories, which accumulated more than 80% of the total volume of investment.

The report states that “the resilience that the higher categories have shown in times of crisis and the new trends increasingly focused on living experiences, haute cuisine and service personalization, among others, point to the luxury segment continuing to have a strong role in the investment landscape in the coming years”. Madrid, Barcelona and Malaga were the main protagonists in the urban area, while the Costa del Sol and, above all, the Balearic Islands were in the holiday segment.

Regarding the investor profile, investment managers and firms were again the main protagonists in 2022, with 59% of the total volume invested. Hotel groups were also especially active, with 25% compared to 16% in 2021. For their part, ‘Family Offices’ and individual investors were somewhat more conservative (5%), while socimi (6%) They remained in line with the previous year.

The four-star category was once again the favorite among the transacted assets, with 49% of the total investment. In relation to the origin of the investment, this was mostly international, representing 72% of the total invested in Spain in 2022, largely due to the fact that the main portfolios and individual assets with the highest volume were acquired by international investors.

In 2022, the percentage of investment allocated to portfolios was the highest in the last four years, with almost half of the total investment. Among the portfolio operations with the highest volume, the purchase of the Ikos group by GIC, the acquisition of 51% of the Rosewood and Bless Madrid hotels by Sancus Capital, the purchase of the 5 Alua assets by Fattal Hotel Group or the transaction of the Ayre hotel portfolio carried out by Eurazeo.

The increase in construction costs, the difficulty in projecting the behavior of hotels in the future, the difficulty in obtaining bank financing or the gap that still exists between the expectations of buyers and sellers, caused that in 2022 the safest assets were that more were transacted.

POSITIVE OUTLOOK.

Regarding the prospects for next year, the consultancy anticipates a definitive recovery of all destinations in 2023, as well as the start of a new path of widespread growth. Thus, their forecasts are that the investment volume will once again exceed 3,000 million euros and the hotel management agreement (HMA) and franchise contracts will grow at double digits.

If 2022 was the year of recovery in tourist demand, in 2023 a consolidation of hotel performance is expected both in holiday destinations and in urban markets.

In the first case, they predict an approximation of the average daily rate (ADR) levels, after the significant increase experienced last year, and a return to normality in terms of occupancy. As for the cities, 2023 will be the year of their full recovery; the MICE segment will return to pre-pandemic levels and the ‘bleisure’ trend will continue to strengthen tourist demand in the main urban destinations.

considering a gradual recovery of cash levels

thanks to the long-awaited return of long-haul tourists,

especially the Asian market, and a progressive precision of the operating costs from the second half of 2023, the forecasts of the experts are that during the next year the hoteliers will maintain the same rate of investment.

“The indisputable confidence of international investors in the Spanish hotel sector and the resilience shown by the most prime assets and the most consolidated holiday destinations will continue to increase the weight of these sources of capital in the 2023 investment landscape,” the report concludes. In 2023, alliances will continue to be produced with a high probability

strategies and corporate operations in an increasingly

global and competitive Thus, inorganic growth will become habitual

between hotel groups and even by investment groups.

In the opinion of the experts, “this strategy makes it possible to accelerate expansion, generate significant economies of scale, increase the brand portfolio, expand the customer base and be much more competitive.”

A strong role for brands is also expected

international organizations in 2023, as they have demonstrated during the last

years to have his main focus of interest in Spain. Accompanied by many

Sometimes investment partners, these groups will be responsible for the exponential growth of management and franchise contracts in our country over the next year.

On the other hand, sales or leases will continue to take place, allowing national groups to reduce their real estate, accelerate their growth and face possible financial obligations derived from the Covid period.

* This website provides news content gathered from various internet sources. It is crucial to understand that we are not responsible for the accuracy, completeness, or reliability of the information presented Read More

Puck Henry
Puck Henry
Puck Henry is an editor for ePrimefeed covering all types of news.
RELATED ARTICLES

Most Popular

Recent Comments