Hotel investment volumes soar 84% in 2021 – Hotel Owner

Total UK resort funding volumes hit £4.14bn in 2021, marking an 84.3% enhance on 2020 volumes, and slightly below the 15 yr common of £4.22bn, in response to new figures from Savills. 

The yearly whole adopted a very sturdy bumper This fall, the place £1.42bn was transacted total.

Savills acted on the 2 largest single asset transactions that happened throughout the yr, claiming nearly 20% of market share by means of whole funding quantity. 

The regional UK resort market skilled a “considerable increase” in funding in 2021, reaching £2.04bn total, greater than 570% 2020 volumes. 

Private Equity capital “commanded” the regional market, in response to Savills, accounting for 62.9% of resort funding, reaching £1.28bn in whole. Notable offers included Goldman Sachs’ acquisition of The Belfry Hotel and Resort for round £140m in November, and Zetland Capital Partners’ acquisition of the Macdonald Manchester Hotel and Macdonald Holyrood Hotel in November 2021. 

In addition, key portfolio transactions included Henderson Park’s acquisition of a portfolio of 12 accommodations underneath Hilton manufacturers in September, Marathon Asset Management’s acquisition of 17 Holiday Inn and Crowne Plaza branded accommodations from Cerberus in May and Blackstone’s acquisition of Warner Leisure Hotels as part of the broader Bourne Leisure transaction in February. 

In London, abroad buyers continued to be lively in 2021, accounting for 44.7% of volumes, together with notable offers reminiscent of Singaporean based mostly Fragrance Group’s acquisition of the Holiday Inn Kensington Forum in December. 

Total 2021 resort funding volumes in London had been up 11% year-on-year to £2.10bn, whereas the variety of transactions rose 68.4% over the identical interval, reaching 32 transactions.

Tim Stoyle, head of UK Hotels at Savills, says: “The resort sector has had a resilient yr with sturdy momentum within the closing quarter showcasing the urge for food for UK resort property. 

“While there remains operational challenges in the short-term, investors continue to be positive on the long-term outlook of the sector and we anticipate another strong year in 2022 for the UK hotel investment market.”

Rob Stapleton, head of UK Hotel Capital Markets at Savills, says: “There is a demand-supply disconnect out there immediately and while 2021 transactions volumes confirmed a powerful rebound from 2020 ranges, the continued relative lack of obtainable resort inventory in comparison with the quantity of capital ready to be deployed, suggests this imbalance will likely be an ongoing problem in 2022. 

“However, the new year has started with positive momentum and we are preparing to launch a number of new hotel instructions to market in the coming weeks, which we anticipate will be well-received by the market.”


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