UK's regional hotel market to experience further growth
The predictions follow the news that occupancy rates at hotels in Birmingham, Leeds and Edinburgh all grew this year, driven by a buoyant business environment and weak sterling creating demand from corporate and leisure guests from the UK and abroad.
And while UK hotel investment transactions in the first half of 2016 declined compared to the same period in 2015, the regional UK market secured the vast majority of total volumes at c£1.1 billion
JLL said the growth in demand coupled by the fact that another 4,886 rooms are set to open in Birmingham, Manchester, Leeds and Edinburgh by the end of 2018 could lead to further growth in the regions.
“As corporates expand their HQ reach beyond London and the UK becomes a more affordable and accessible place to visit for overseas tourists from China and the US, we are seeing strong growth in the hospitality sectors across the UK regions," said Kerr Young, director in JLL’s Hotels & Hospitality Group.
“London has long been a focus for hotel investment, but now regional market is witnessing the benefit of interest from overseas investors following the weakening of the pound. Despite initial uncertainly in the immediate aftermath of the recently EU referendum there is positive story around the UK in terms of macro economic stability and transparent transactional environment."
Kerr said recent deals, such as the purchase of the Hyatt Regency Birmingham by Bin Otaiba Investment Group and the the acquisition of Premier Inn, Morrison Street in Edinburgh by Israel based Leonardo Hotels, were setting a trend with more foreign investment set to flood into the UK.
Many international hotel groups, such as Pentahotels, Hyatt and Motel One are also set to expand further into the UK this year with many cities and towns outside the capital their target.
