Hotels rooms forecast to be top UK investment asset in 2017
Approximately £3.9bn was invested into the UK hotel market in 2016. According to property experts Savills, the number of deals finalised in the sector doubled in the second half of the year, highlighting investors’ ongoing confidence in the market despite the uncertainty surrounding Brexit. The hotel market was one of the few UK sectors able to capitalise on the referendum result, and now looks set to be one of the country’s top investment asset classes for 2017.
According to Savills, in Quarters 1-3 of 2016 investment in the hotel sector was more than 12% above the average for the past 10 years.
The referendum result caused the trend to intensify, with the drop in the pound causing a boom in British tourism and contributing an estimated £1.4bn to the UK economy (source: Tourism Alliance). The declining value of the pound has also encouraged overseas visitors to flock to the country to take advantage of their newfound buying power.
For property investors, the tourism boom has made the hotel market increasingly attractive, as growing demand creates an increasingly stable investment environment and improves the potential for both rental returns and capital appreciation.
Martin Rogers, head of UK hotel transactions at Savills, said “Hotels continue to be a favourable option for investors looking to the UK.” He believes that even in a post-Brexit environment, the UK will continue to be attractive to visitors, which in turn will ensure a high demand for hotels and a long-term income for investors.
The fundamentals that make British property attractive have remained largely unchanged. The country’s stable economic performance, safe political environment, growing demand for property and rising prices have all remained constant and make the UK an extremely sought after investment destination. Added to this, the value of the pound means buyers from overseas are now able to make significant savings on the purchase of UK property.
The increasing tourist demand, combined with improved value for money, makes the UK hotel sector one of the most promising asset classes of 2017.
Select Portfolio has a wide variety of UK hotel investment opportunities, offering some of the most impressive returns of any UK property.
If you’re interested in purchasing a UK hotel investment, contact us today on +44 (0)1202 765011 or email [email protected] for more information.