Market reports

Whether only driven by occupancy rise (Italy and Spain) or by increase in average room rates and occupancy, RevPAR recorded growth from 2% in Italy to 20% in Germany. However, these good hotel performances observed in 2010 do not compensate the sharp falls suffered in 2009. There is still some distance from 2008 levels and even more from those of 2007 record year.

Coming from a particularly low basis in 2009, investment activity in hotel real estate improved in 2010. Hotel investment volume in the top five European markets amounted to €6.6bn in 2010, doubling compared to the previous year. Indeed, the positive situation of the lodging sector enhanced investors’ confidence. Moreover, as operators continued their asset-light strategy 2010, particularly the second half of it, witnessed large sales and leaseback of pan-European portfolio. Even though less numerous than expected, many distressed assets came onto the market, particularly in Germany and the United Kingdom. The latter, followed by France, keep the European lead in hotel investment activity; together they represent 76% of the top five countries volume.