20 June 2016 – Expansión
Hotel investment in Spain may reach €2,000 million this year, according to estimates made in a study compiled by the real estate consultancy Irea.
Between January and May this year, based on provisional data, investment in the purchase of hotel assets in Spain amounted to €611 million, down by 14% compared to the same period in 2015.
Nevertheless, this investment level is very significant for the real estate consultancy, in comparison with the trend seen during the first five months of the year over the last ten years.
In terms of the volume of hotel assets sold, the figure is very similar to the same period in 2015. During the five months to 31 May 2016, 39 hotels have been bought and sold (compared with 42 last year), nevertheless the number of rooms transacted has decreased by 42.2% from 8,673 to 4,993 so far in 2016.
Increase in the average price paid per room
According to Irea, this implies a considerable increase in the average price per room from €81,000 during the period from January to May 2015 to €122,000 during the same period this year.
For the consultancy firm, this increase is primarily explained by the sale of Villamagna in Madrid (in Q1 2016), at a price of €1.2 million per room, which represents the highest price ever paid per hotel room in Spain.
In addition, the study shows that no hotel portfolios have been sold so far during the five months to May, compared with four that had been sold during the same period in 2015.
It is worth noting the Socimis’ commitment to the hotel sector in the short and medium term, a formula that is currently accounting for all of the operations associated with repositioning assets and adapting them to suit the premium segment.
Experts in the hotel sector agree that the level of growth in this industry may continue in Spain if the hotel supply is renewed and updated in line with the expectations of international tourists, in addition to the investment in technology and the search for customer loyalty.
Original story: Expansión
Translation: Carmel Drake