European Hotel Transactions 2004 - The Year in Review

HVS London has published its European Hotel Transaction Review, which details single asset and portfolio hotel transactions that took place during 2004.
HVS International's London Office has today published its latest European Hotel Transaction Review, which details single asset and portfolio hotel transactions that took place during 2004. A number of clear trends are highlighted by the 2004 survey:
  • In 2004, the European hotel investment market shifted into top gear with a tremendous increase in activity. HVS recorded a 31% increase in total investment activity in 2004 compared with the previous year, to approximately €8.9 billion, fuelled by a significant number of high-net-worth individuals and private equity investors seeking to diversify their property portfolio and acquire higher-yielding investments;
  • With a number of European markets enjoying RevPAR growth, the upside of hotels in a recovering market is very appealing, creating a very attractive environment for investors. HVS International recorded 137 single asset hotel transactions of above €7.5 million, an increase of 21% on the previous year, with total investment of approximately €4 billion;
  • HVS International recorded 22 portfolio transactions, which amounted to approximately €4.9 billion, an impressive 39% increase on the previous year. The increase in activity was driven by a wealth of capital invested in the sector by non-specialist buyers seeking hotel portfolios with significant potential for growth.
Commenting on the results, joint author Philippa Bock, a Senior Associate with HVS International said, "There has never been a more exciting time for the European hotel investment market, with a growing trend amongst the publicly listed hotel companies to drive earnings and increase the return on capital employed by divesting of ownership, whilst maintaining management control; this is likely to drive a significant volume of portfolio investment activity in 2005, particularly in the UK." "Investor confidence during 2004 has been particularly robust; the prospect of improved profitability where significant upside is achievable has created a very attractive environment for investors. In 2005, we envisage an increasing level of investment activity in most markets in Europe with particular emphasis on Germany, France, the ten EU accession countries and Turkey, in addition to the UK." added co-author Bernard Forster, a director of HVS International. Total Hotel Investment Volumes 1998-04 (€ millions) Source: HVS International Research The report provides a comprehensive review of the following:
  • European single asset hotel transaction activity - 2004;
  • European portfolio hotel transaction activity - 2004;
  • Profile of investors;
  • Cross-border activity;
  • The continuing rise of management contracts;
UK property investment funds - a summary of events in 2004. Copies of the European Hotel Transactions 2004 report are available free of charge from HVS International, via the following link: http://www.hvsinternational.com/library/
For further information please contact: Philippa Bock, Senior Associate Tel: +44 20 7878 7738 Mobile: +44 7956 351 198 Email: pbock@hvsinternational.com Bernard Forster, Director Tel: +44 20 7878 7719 Mobile: +44 7801 234 908 Email: bforster@hvsinternational.com Russell Kett, Managing Director Tel: +44 20 7878 7701 Mobile: +44 7802 411 142 Email: rkett@hvsinternational.com