Colliers International has called for an ease of planning restrictions in order to give hotel owners the opportunity to repurpose their sites following the global pandemic.
The group said that hoteliers may see redevelopment as a “way to recoup their investment or minimise their losses”, following forced closures and pressures on cashflow in light of the nationwide lockdown.
It added that redevelopment options may be a “far more realistic and rewarding route” for certain hoteliers, and provide a way of optimising the equity from their investment. In addition, it noted that redevelopment of sites can remain “relevant and helpful even after the crisis abates”.
In light of this, the group has called for planning authorities to relax some of the legislation around redevelopment of hotels for alternative use, as well as relax the time taken to “prove any unviability”.
The group said: “Colliers has sold plenty of hotels to residential developers in the past and is continually asked about hotels that might suit conversion.
“The downside for hotel owners is that such interest is normally subject to a lengthy planning process which can jeopardise the trading performance i.e. their guest clientele become concerned about the long-term existence of the hotel and bookings diminish.”
It added that the pandemic has provided an “opportune” time for some hoteliers to consider whether redevelopment to alternative use is a “better and more profitable strategy” than reopening as a loss-making hotel.
Paul Barrasford, director, Hotels Agency at Colliers International, said: “Over the past few months, hotel owners have been focussed on the immediate and harsh challenges posed by the lockdown.
“Many are now looking to their reopening strategies and the prospect of a bounce back for hotels is very welcome news.”
He added: “Unfortunately, a few hotel owners are faced with the conundrum of wanting to reopen but knowing that unless something close to previous revenue is achievable, then there are significant risks in doing so.
“Unable to wait for a return to re-pandemic operating conditions, looking at redevelopment options may be a far more realistic and rewarding route for a few hotel owners to optimise the equity from their investment. A relaxation of planning restrictions could be just what they need and would boost the economy and provide much needed housing.”