4 key takeaways from Deloitte European hotel investment survey 2019
European Hotel Investment Survey for 2019 by Deloitte was published which questions the European hotel investment market. The key challenges are seen as a risk that will likely cause impact in the market.
Deloitte, one of the “big four” international accounting firms, recently published its European Hotel Investment Survey for 2019.
The survey, which includes input from more than 120 senior hospitality figures across the world, involves a series of questions related to the European hotel investment market, aiming to ascertain the prevalence of views as they relate to key trends. The survey also looks at how those trends have the potential to shape the European hospitality industry in 2019 and the years to follow.
The latest European Hotel Investment Survey has found a healthy desire to invest in the region’s hospitality market throughout 2019. It has also found some key challenges, including talent shortages, increased employee costs, and a lack of economic growth for United Kingdom hotels. These challenges are seen by many as a risk that will likely impact the market.
Below are four more key takeaways from the survey.
1. Europe is growing
There is, as usual, a healthy focus on Europe from investors, with Amsterdam ranking as the top choice among the most attractive cities for investment. London finished in second place and Paris third. Barcelona, meanwhile, slipped to sixth place after a moratorium there was applied to hotel development — something that’s becoming common in the continent as cities seek to manage overtourism.
2. The main risks for industry
The main concern for investors in European hospitality at present is lack of economic growth, which they identified as a main risk over the next five years. In the United Kingdom specifically, however, other risks include staff and profitability, with 68 percent pointing to increased employee costs and 63 percent to skills shortages as high risks.
3. Main revenue regions
The survey also took stock of expectations for growth, noting that 73 percent expect revenue per available room (RevPAR) growth in the UK to be below 3 percent in 2019, while Edinburgh and Cambridge are the cities expecting the highest growth. London, meanwhile, saw 87 percent of respondents expecting to achieve less than 3 percent growth in 2019, with one in four expecting negative gross operating profit per available room (GOPPAR) growth in London and a fifth expecting negative growth in UK region.
4. Brands are the future
Finally, 74 percent of respondents believe there should be more available hotel brands, with the greatest opportunities being among properties that target millenials, as well as with midscale extended stay offerings.
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