Fewer investments on Europe's hotel market

2010-03-11

In 2009 turnover on the European hotel market was down approx. 50% year on year. At the same time, transaction volume dropped sharply by 85% relative to 2007 – the year in which €19.8bn was invested in the European hotel market, based on data published by Cushman & Wakefield.
Last year €3.2bn was invested in hotel properties, while €6.4bn had been spent on such investments in 2008. The most active were investors in the UK – there hotel property transactions yielded €935m, that is approx. 29% of total transaction volume in the hotel industry in Europe. Second place was taken by France, followed by Germany, with aggregate transaction values of €500m and €300m, respectively. Based on C&W data, the largest transaction of last year executed in Europe was Azure Group’s sale of Radisson Blu hotel in Hamburg to Invesco Real Estate fund for €155m.
In the opinion of analysts from C&W, more transactions should be executed on the European hotel property market, some will be a consequence of the difficult financial standing of companies which today must repay debts contracted during the bull market to execute hotel investments – and this is exactly what the market ‘s big fish are waiting for to invest the significant cash they have on hand.