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European hotel investment volumes reached a record high of €23bn (£20bn) in 2018, according to the latest data from leading global real estate advisor, CBRE.
According to the firm, the figure represents a 3.4% increase on a “strong 2017”, and is 73.2% higher than the 10-year sector average. The total real estate investment volume for all sectors in Europe saw an increase of 0.3% compared with 2017.
2018 European hotel investment activity was driven by growth in the UK, Spain, Italy and Ireland. A strong level of activity in the second and fourth quarters of 2018 saw hotel investment volumes in the UK reach €7.7bn (£6.7bn), an increase of 24% year-on-year.
This was driven by several notable deals including Project Dragon Glass, the sale of eight Hilton-branded hotels and single assets such as The Midland Hotel in Manchester and the five-star Beaumont Hotel Mayfair in London.
Colin Low, head of hotel investment properties at CBRE Hotels, said: “2018 was a record year for hotel investment. The growth in key European markets such as the UK and Spain is testament to the strong fundamentals of the hotels sector which continues to attract robust demand from investors across the board.
“Non-European buyers accounted for 43% of the European hotel investment volume with Middle East investors, mainly Israeli becoming increasingly active, accounting for 11.1% of capital deployed across the European region in 2018.”
