[+] Investors are looking for opportunities in the hospitality sector

[+] Investors are looking for opportunities in the hospitality sector

Despite some challenges in operating markets, investment measures have held up surprisingly well, driven by positive long-term fundamentals for the industry, the weight and relatively low cost of global capital-raising deals. and a strong national demand base in both business and leisure segments, says Gus Moors, director of Colliers hotels.

“As a result, existing hotel owners feel confident to bring their assets to market, despite current short-term hurdles, knowing that they will achieve fair value for their property.

“From a debt perspective, traditional national banks continue to lend into the hotel market, albeit at potentially lower LVRs, but there is also a range of non-bank lenders ready to step in, as they recognize that the sector is likely to rebound. back quickly.

From an equity perspective, most recent hotel deals have been with domestic investors, but in many cases these domestic funds can source capital from overseas, Moors adds.

Despite the border closures, offshore capital continues to invest, but mainly indirectly.

“We are currently marketing a number of assets that offer potential for repositioning or redeveloping the hotel, and we are seeing very strong interest from developers. They tend to look in terms of cycles and therefore focus beyond the current cycle into the future, brighter perspectives, ”says Moors.

Peter M. Doran