Investors target UK regional hotels amid staycation surge
Investors are targeting hotel properties in staycation destinations such as Brighton as the coronavirus pandemic has led to more Britons going on holiday within the UK rather than risking international travel.
Interest in coastal and country hotels has spiked due to the increase in holidaymakers deciding to book domestic trips this year, with some locations already reporting high levels of demand for next summer.
According to the latest research by estate agent Savills, while UK hotel investment volumes continue to be dominated by London, total deal count outside of the capital has “climbed dramatically” since the easing of coronavirus restrictions.
Savills reported receiving multiple offers above the guide price for regional assets that are currently on the market.
However, total hotel investment volumes to the end of September were down 54.4 per cent at £1.63 bn compared to the same period last year.
Interest levels remained “robust” despite the crisis, Savills said.
Tom Cunningham, director in the hotel investment team at Savills, said: “With restrictions limiting international travel as a result of Covid-19 we experienced a boom in domestic travel and staycations resulting in many popular tourist hotspots being fully booked over the summer and into late autumn.
“The likelihood of ongoing restrictions into 2021 has meant that holidaymakers are continuing to look to the domestic market for their breaks and some locations are already reporting high levels of demand for next summer.
“As a result, we expect robust operational performance in these locations to continue with well-situated regional assets continuing to attract strong investor demand. For regional assets currently on the market we are receiving multiple offers above guide price.”