Hotel values for most key European cities grew during 2013, according to HVS London’s 2014 European Hotel Valuation Index (HVI), and hotel values are expected to continue to increase as the lending environment becomes more favorable and the economic recovery improves demand.
“We expect 2014 to be the year for secondary, regional markets and for countries that are emerging from acute recessions and offer increased upside opportunities, albeit at a somewhat higher risk,” said report co-author Christof Bertschi, associate, HVS London. “Whilst only eight countries were at above pre-crisis peak levels in 2013, we expect this number to increase modestly to about 10 in 2014, and to just over a dozen by 2018.” commented
Among cities this year’s HVI earmarks for growth are Tallinn, Estonia, because of its continued strong performance; Dublin, a current darling of investors; as well as more subdued growth for the main Eastern European markets including Prague, Czech Republic; Bratislava, Slovakia; Bucharest, Romania; and Sofia, Bulgaria.
“Key gateway cities such as London, Paris and Barcelona are expected to remain attractive for developers and investors, whilst German cities such as Munich and Frankfurt will continue to be considered a haven owing to Germany’s economic stability,” Bertschi added.