real estate Archives - HPG Advisory Services I Hospitality Leadership Advisory

Briefing: Healthcare, student housing, and hospitality

Posted on September 22, 2015February 21, 2019 by Guy Lean

Hospitality properties are performing well this year, but outside of our industry, what other asset classes do investors have their eyes on?

There was 2.1% capital growth in UK healthcare property in 2014, and £4.2 billion invested in UK student housing in the first 5 months of 2015. Both sectors have had an increase in demand, with 16,800 more students in 2014 than 2013, and 11.4 million people currently aged 65 or over in the UK.

In this briefing three experts discuss healthcare and student housing and how it relates to hospitality:

According to the IPD UK Annual Health Property Index, healthcare property returned 9% in 2014. The Index also shows that in December 2014 there were a total of 1,073 Healthcare properties in the UK, with £3,957 million Capital value, and 41 funds.

Last year the Financial Times reported that there had been a particular rise in investment in the ‘UK’s £15.1bn-a-year care home market’. As discussed in the above video, there has been increased need for this type of property due to the increased aged population. According to the latest statistics from Age UK, there are now 3 million people are aged 80 or over in the UK. The number of people aged 60 or over is expected to pass the 20 million mark by 2030.

According to Savills, investment into student housing increased 23% 2013-2014, and increased 70% again in just the first 5 months of 2015. With a 3.4% increase in the number of applications for the current academic year, there looks to be a continued demand for this accommodation. The report suggests that the increase in purpose built student accommodation could help free up much needed residential properties.

As two examples of high performing sectors, both healthcare and student accommodation were discussed at the Hotel Alternatives Event this year.

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Video clips produced by ybc.tv for the Hospitality Channel, including interview from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.

Briefing: The real estate perspective

Posted on September 1, 2015February 21, 2019 by Guy Lean

A survey by Berwin Leighton Paisner earlier this year found that, 70% of hotel professionals believe hotels will continue to outperform “traditional” commercial property investments.

A separate survey by PwC ranked hotels number 6 for investment prospects in a list of 20 real estate sectors. 62% of respondents to the survey said hotels had either good or very good prospects. Serviced Apartments came at number 9 with 59% of respondents saying the prospects were good.

This briefing features professionals from the hospitality industry whose focus is on investment and ownership:

The Emerging Trends in Real Estate Report from PwC showed that London was the most active European real estate market in 2014. A global ranking showed New York was the top city for commercial property investment in 2014 with a sales volume of $57,012, and London was second with $42,889.

The report also highlighted issues and concerns in the real estate industry. 47% of property professionals said a ‘shortage of suitable assets to acquire’ was a significant issue impacting real estate business. 78% of European respondents and 80% of US respondents said ‘demographics and social change’ would have an impact on business decisions in the coming years.

In the US, real estate business prospects for multifamily developers were rated as good (3.9 out of 5). Business prospects for real estate brokers where rated at 3.91 out of 5, and private local real estate owners had prospects of 3.86 out of 5. Prospects across all business sectors listed showed an improvement on the previous year.

Within the hospitality industry, BLP’s European Hotel Market Survey 2015, found that; 80% of hotel professionals say hotels are becoming more of a valued asset class for investors, but are still perceived by many as risky. In the survey, 89% of respondents foresaw increased competition from the residential market with short term lets.

If you’ve been sent to this page and you’re not yet on the circulation list to receive these regular briefings and you would like to sign up, you can do so here. It’s free.

Video clips produced by yBC for the Hospitality Channel, including interview from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.

Briefing: Serviced apartment sector is mature and growing

Posted on April 2, 2015February 21, 2019 by Guy Lean

A new report from Travel Intelligence Network (TIN) shows that there has been a 14% growth in the serviced apartment supply chain globally since last year. The report, commissioned by The Apartment Service, found that there are almost 750,000 serviced apartments worldwide. It shows that serviced apartments are increasingly used by businesses for project work. And, like the rest of the hospitality industry, this sector has not gone unaffected by changes in distribution with 75% of operators receiving bookings from OTAs.

As serviced apartments gain prominence in the hospitality industry, four experts discuss the unique benefits and challenges of business and investment in the sector:

According to The Apartment Service: ‘The report highlights that the serviced apartment industry has reached a level of maturity that is showing future growth of supply.’ Deals are being done across the industry. At the end of 2014 there were approximately 1.700 units in the development pipeline in London according to the UK Serviced Apartment Report – Q4 2014 by Savills. There is also strong industry growth in Scotland with RevPAA up 16.2% year on year.

A recent merger between SACO and Oaktree Capital Management, announced on the 2^nd March 2015, has resulted in the formation of a £60m hospitality company. The combined company has an inventory of 1645 apartments and is launching a new brand – Beyonder ApartHotels, which will focus on millennial travellers and will open its first ApartHotel in December 2015.

Frasers Hospitality announced the development of a new property in Hamburg recently (20^th March 2015) which is the 50^th city the company has entered.

Dublin based serviced apartment company StayCity has 1000 apartments across Europe and is due to open properties in Birmingham, Lyon and London in 2015.

And an industry leader BridgeStreet Global Hospitality, which rebranded last year, is going strong with 50,000 apartments in 60 countries and a collection of awards.

If you’ve been sent to this page and you’re not yet on the circulation list to receive these regular briefings and you would like to sign up, you can do see here. It’s free.

Video clips produced by yBC for the Hospitality Channel, including interview from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.

Briefing: ingredients for deal making

Posted on August 1, 2013February 21, 2019 by HPG Advisory

Many components of what makes a great deal in hospitality haven’t changed in many, many years, however, there is an a continual evolvement of how deals can be struck and what is need to get that agreement over the final few hurdles.

Understanding the risk and what to consider when investing in new areas is key and many believe the emphasis towards long-term contracts is very real with investors wanting to ensure steady returns rather than immediate gain.

Experts discussing deal-making this week include:

David Thomson, COO of JA Resorts & Hotels on the importance of a partnership

Christian Mole, Executive Director – Transaction Advisory Services of Ernst & Young LLP on the long-term trend

Rob Seabrook, Head of Hotel Transactions for Savills on the need for good cash flow

And Gaël Le Lay of Head of Hotel Investment, AXA Real Estate on what they look for in a good deal

If you’ve been sent to this page but you’re not yet on the circulation list to receive these regular briefings and you would like to sign up, you can do so here. It’s free.

Video clips produced by ybc.hpgcms.wpengine.com for the Hospitality Channel, including interviews from industry conferences such as the most recent IHIF conference as well as specific Hospitality Channel shoots.