[PDF] European Hotel Investment Survey Changing gears: a new era?

Is the European Hotel Investment Market still active?

Newly released data from Cushman & Wakefield’s Marketbeat: Europe Hospitality H1 2020 reveals that the European hotel investment market has stayed active during this crisis. Expectedly, investment volume for the region had fallen considerably by 55% compared to the same period last year.

What are Hotel Investments?

Hotel investments can provide an exciting opportunity for first-time property investors to buy into a great industry with excellent earning potential or for established property investors to diversify their portfolios and capitalise on all the service industry offers.

What is the average IRR for hotel investments in Europe?

Invariably the ultimate decision will depend on the company’s gearing and the investor’s risk profile. As an indicator the average IRR for hotel investments in Europe ranges from 12.4% to 16.1% with an average of 14%. In addition it is evident that discount rates applied to investment decisions depend on a company’s WACC or desired level of return.

How big is the hotel industry in Europe in 2022?

Hotel industry in Europe’s market size was estimated at ~EUR 21.9 Billion in 2022. As compared with 2020, revenues increased by ~9.20% in 2021 YOY but the market will also see a steep recovery in 2022 led by domestic and leisure tourism. It is only By 2024, that the market will be able to reach pre-covid levels of around ~EUR 32.1 Billion