Hotel Sector in H1 2022
Despite the challenging context of the last two years, the investment appetite in the hotel sector is showing a very positive trend. First of all, it can be highlighted that investment volume in H1 2022 has reached €1,650 million (+51% vs. H1 2021) with 72 transactions (8,998 rooms), compared to the 44 transactions (5,309 rooms) accounted in H1 2021. Madrid has become the main focus of hospitality investment, accounting for 26% of total, followed by the Balearic Islands (23%) and Barcelona (14%).
This investment trend has been mainly focused on 4 & 5-star hotels. Specifically, over 50% of the transactions were of 4-star hotel and c. 15% were 5-star hotels. Moreover, a greater appetite for investments in urban assets (57.4% over total investment volume) has been seen.
As for the investor profile, c. 80% of investors have been institutional and hotel groups, and their origin is mainly Spanish (41%) and German (20%). Besides, a recent study concluded that c. 45% of investors have invested the same amount as at pre-pandemic levels and c. 40% of investors have invested even more. Only c. 15% invested less.
The main concerns affecting investors are mainly due to the rise of construction costs, supplies and raw materials, the increase of the inflation rates and the difficulties to obtain debt financing.
From CG Capital Europe, we perceive that the tourist sector has performed extremely well this summer (reaching pre-covid levels) and therefore, the hospitality sector is going to keep reaching a lot of attention from national and international investors.