Tuesday, August 19, 2023
Scottish hotel market continues to trade well
According to a report by global property consultancy, Knight Frank, the Scottish hotel market is continuing to experience relatively healthy trading conditions and reasonable transactional activity is still occurring, particularly with properties in the £1m to £20m lot size bracket.
The UK Hotel Review, which investigates the UK's hotel sector, highlights that the Scottish hotel market is remaining relatively buoyant despite the effect of difficult economic conditions on other sectors. It states that the biggest benefactors of these conditions in Scotland have been properties which can offer a change of use such as townhouse hotels which are proving popular in many Scottish cities, including Edinburgh and Aberdeen.
Hotels such as the Number Ten Hotel, (incorporating The Christopher North House Hotel) in Edinburgh are attracting new investors who are realising the security of having a long term product and flexible business model. Knight Frank is currently marketing the Number Ten Hotel and with profits recorded at well over £500,000 this company sale is already attracting interest from a variety of purchasers.
The report also highlights that the Aberdeen hotel market is being driven by the city's booming oil industry and has typically shown stronger than average room and utilisation rates throughout the year. The city's hotel sector has seen several transactions throughout 2007 during which Knight Frank acquired the 50 bedroom Simpson's Hotel in Aberdeen on behalf of Manorisms LLP at a price in excess of £10m.
By contrast, Edinburgh has benefited from the fringe festival and business travel, whilst cities like Inverness remain buoyant tourist destinations. Glasgow's hotel performance is boosted by its importance as a conference destination and among the noteworthy single transactions of 2007 was the purchase in January of the 250 bedroom 5 star Glasgow Radison SAS hotel by Edinburgh based Strategic Investment Management for a reported £68 million.
David Reid, partner, Knight Frank said: "As Knight Frank's Hotel Review highlights, small boutique hotels in Scotland are attracting a lot of interest at present due to their lower operating costs and change of use potential. Cities such as Edinburgh have really exploited this with many townhouse properties now marketing their potential as both a hotel business and residential use. Scotland's hotel sector is still very active and there are many investors with cash reserves who are looking to capitalise on these opportunities."
The UK Hotel Review, which investigates the UK's hotel sector, highlights that the Scottish hotel market is remaining relatively buoyant despite the effect of difficult economic conditions on other sectors. It states that the biggest benefactors of these conditions in Scotland have been properties which can offer a change of use such as townhouse hotels which are proving popular in many Scottish cities, including Edinburgh and Aberdeen.
Hotels such as the Number Ten Hotel, (incorporating The Christopher North House Hotel) in Edinburgh are attracting new investors who are realising the security of having a long term product and flexible business model. Knight Frank is currently marketing the Number Ten Hotel and with profits recorded at well over £500,000 this company sale is already attracting interest from a variety of purchasers.
The report also highlights that the Aberdeen hotel market is being driven by the city's booming oil industry and has typically shown stronger than average room and utilisation rates throughout the year. The city's hotel sector has seen several transactions throughout 2007 during which Knight Frank acquired the 50 bedroom Simpson's Hotel in Aberdeen on behalf of Manorisms LLP at a price in excess of £10m.
By contrast, Edinburgh has benefited from the fringe festival and business travel, whilst cities like Inverness remain buoyant tourist destinations. Glasgow's hotel performance is boosted by its importance as a conference destination and among the noteworthy single transactions of 2007 was the purchase in January of the 250 bedroom 5 star Glasgow Radison SAS hotel by Edinburgh based Strategic Investment Management for a reported £68 million.
David Reid, partner, Knight Frank said: "As Knight Frank's Hotel Review highlights, small boutique hotels in Scotland are attracting a lot of interest at present due to their lower operating costs and change of use potential. Cities such as Edinburgh have really exploited this with many townhouse properties now marketing their potential as both a hotel business and residential use. Scotland's hotel sector is still very active and there are many investors with cash reserves who are looking to capitalise on these opportunities."
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