Hospitality sector specialists at Colliers International are predicting that in 2017 the UK regional hotels market will be supported by low interest rates and cheap sterling, solid UK trading, acquisitive domestic buyers and an increasing flow of international capital.
The Cotswolds will benefit from these national and international factors – and also from its heritage and location, according to a hospitality expert at sector specialist Colliers International, who last year was involved in brokering 11 sales totalling over £11m in the Cotswolds.
Hotels director Peter Brunt is predicting that the market will remain robust and is anticipating further high levels of activity in 2017.
He said: “The Cotswolds are ‘classic England’ as far as visitors are concerned and with its pretty villages and easy accessibility from the capital it is always a considerable draw.
“Operators are already feeling the increased demand from overseas visitors and this is one of the reasons fuelling a strong demand for hospitality businesses in the region.
“The last quarter of 2016 saw a noticeable uptick of enquiries from buyers seeking a business in the region including a number of overseas high net worth individuals or corporations seeking investments in Britain.”
Julian Troup, head of UK Hotels Agency at Colliers International, added: “The UK hotel market is a consumer-driven real estate sector so its performance is closely linked to the overall general economy.
“With a few new supply-driven exceptions, the UK regional market will be supported by low interest rates, solid UK trading, acquisitive domestic buyers and an increasing flow of international capital attracted, in part, by cheap sterling.”
Mr Brunt pointed out that low interest rates and poorly performing savings accounts, ISAs and pension schemes could persuade more people to think of buying into the hospitality sector whether it be hotel, pub or Bed & Breakfast.
He said that a Bed and Breakfast hotel could make an ideal choice for both hospitality newcomers and investors – and could also provide an ideal home life for new owners coming in to the business.
“With high occupancies, smart and stylish guest houses are increasingly being seen as great value for money, with particular appeal to pension potters looking for an investment opportunity before taking full-time retirement – as well as a change of lifestyle,” he said.
“If our inquiry levels are any indicator of the market, it seems more people than ever are seeking to use their pension pot to build a new lifestyle business.
“Poor investor returns as a result of ultra-low interest rates are encouraging more people to search for alternative investment opportunities. Buyer numbers are rising commensurately.
“With improving access to finance we are seeing more competitive bidding for opportunities than seen at any time since 2007.
“UK hospitality and manufacturing exports have done particularly well on the back of Brexit. Almost all our client feedback reflects rising revenue, as the low pound encourages foreign tourism.”
Mr Brunt continued that an additional attraction for investors was the growing trend for Staycation breaks in the UK, as a result of prospective holidaymakers deciding against booking trips abroad because of the weakness of the pound.
He added that the number of people holidaying in the UK is being further boosted by foreign visitors attracted by being able to obtain more for their dollars, Euros and yen.
“For me, the Great British Staycation has never quite lived up to its billing – largely due to indifferent summer weather in the UK,” he said.
“But with the pound hitting low levels against a basket of foreign currencies, we believe the Staycation might finally be here to stay.”