Jones Lang LaSalle Hotels has reported a 38% rise in global hotel transactions which are expected to hit $70bn (£35bn) by the end of the year making 2006 the strongest year on record.
The Hotel Investor Sentiment Survey (HISS), which tracks investor sentiment, reported medium term investor expectations for the Eastern European market are very stronger.
It also reported a positive outlook for the Asia Pacific region with investors very keen to trade in Western Europe where London and Paris are firm favourites.
Arthur de Haast, Global CEO, JLL Hotels said: “Buyers outnumber sellers by 3:1 globally and stock is scarcer still in Europe where buyers exceed sellers by 5:1.”
“Along with trading optimism there has been a tightening in average yields globally which has emerged as a result of a positive economic climate plus substantial capital in the market, limited new supply, increasing transparency and ongoing improvements in hotel trading performance.
“In Europe and Asia we have seen the first signs of yield stability.
“The CEE markets particularly Zagreb, Prague and Moscow are driving this trend, causing yields to rise despite improvements to the perceived risk profiles of these markets as well as growth expectations.
“It is clear that some investors remain confident of even better times ahead as they continue to hold their assets in this strong seller’s market.
“Investor sentiment in building new hotels has increased by nearly 7% since our last HISS 6 months ago, a reaction to the slow supply of assets coming to market and the fierce competition for these assets which continues to drive pricing upwards.”
References: EGi News 20/12/06
