Hotel investment in Germany plunged to EUR 207 mln in the first six months of this year compared to EUR 600 mln in the year-earlier period, according to research from Colliers International. However, investment volume picked up in the second quarter compared to the first three months, rising to EUR 122.6 mln, the adviser said.
Hotel investment in Germany plunged to EUR 207 mln in the first six months of this year compared to EUR 600 mln in the year-earlier period, according to research from Colliers International. However, investment volume picked up in the second quarter compared to the first three months, rising to EUR 122.6 mln, the adviser said.
The first-half performance was considerably below the expectations of most players in the market, said Andreas Trumpp, Head of Research at Colliers International in Germany. 'Germany’s hotel investment market still has not got back into full swing.'
Asset managers and private investors dominated acquisitions while institutional investors stayed away, he added. International investors accounted for EUR 93 mln of the sales, or 45% of the total.
One explanation is that there were very few large-volume transactions in the first half compared to the first half of 2011. Last year the adviser recorded 10 individual or portfolio sales with a volume of EUR 20 mln or more, but only one single sale exceeded this level in the same period in 2012.
That deal involved Invesco Real Estate purchasing two hotels carrying the Indigo and Holiday Inn brands and belonging to the Parkside Alexander complex for approximately EUR 60 mln as part of a sale-and-lease-back deal.
The hotels that changed owners between January to June were primarily in the three to four star categories. These three categories accounted for roughly EUR 168 mln or 81% of the investment volume.
Nevertheless, the pipeline of deals raises expectations that deal volume will increase in the second half-year, said Andreas Erben, chief executive at Colliers Hotel. 'Due to the stable economic situation, the German real estate market continues to be regarded as a safe haven,' he noted. 'We know through close cooperation with our European Colliers partners that there is increasing demand for German hotel real estate on the part of international investors. Since we assume that this trend will strengthen still further, we will intensify cooperation with our colleagues in the United
Kingdom, the Netherlands and Poland.'
