We are delighted to share our latest insights with you on London’s hotel and extended stay market. This is truly one of the world’s most rewarding cities for hospitality, development and investment.
The past few years have presented extraordinary challenges - a global pandemic, political and economic turbulence both at home and abroad, steeply rising construction costs and fundamental shifts in how people travel, work and engage with their living space. Fortunately, London remains exceptionally well-positioned for long-term success, with an enviably high RevPAR and continues to outperform many of its global counterparts as one the leading hotel markets in the world.
The post-pandemic rebound in ADR has been remarkable. Investor confidence has also returned strongly, with 2024 recording the highest volume of UK hotel transactions since 2018, overwhelmingly led by international capital seeking exposure to the sector at scale. Vacant possession as trading entities sales have also picked up, with major transactions kicked off by the Edwardian sale in early 2024 and large single asset sales including The Standard and Six Senses. The asset repricing that occurred across all commercial property sectors is now largely behind us, hotel yields are stabilising and total returns turned positive late-2024. As a case in point, we advised Whitbread on its stimulus package in 2024, achieving one of the strongest post-‘mini budget’ yields in the market, setting market pricing to enable forward funding developments.
