In terms of market share, the South West accounted for 10% of total UK hotel transactions says Savills. The market was predominantly driven by portfolio deals, which accounted for £366 million (59%) of the total invested in the region. Individual transaction volumes reached £254 million (41% of the total) with an average transaction size of £6 million.
The firm notes domestic investors accounted for the lion’s share of investment into South West hotels at £420 million (68%) followed by Israeli investors with £73 million (12%) and French investors with £46 million (7%). Volumes were dominated by branded hotels which attracted £145 million (57% of the total), despite accounting for only 21% of individual asset deal count (44 in total).
Key deals in the region included the sale of the Premier Inn Custom House in Cardiff for £34 million and sale of the County Hotel in Bath which achieved a price per key of £165,000. The average price per key for hotels transacted in the South West was £106,000 notes Savills.
James Greenslade, associate in the hotels team at Savills Exeter, comments: “Last year was another extremely strong year for the South West hotel market, with a number of portfolio transactions helping transaction values to exceed 2017 volumes. Demand for the region’s hotels has been diverse with both strong domestic and overseas demand, underscoring the attractiveness of the sector and its strong underlying fundamentals despite some general economic uncertainty.”