French real estate investment trust Covivio says the tide is turning for its hotel business with the first signs of a recovery in the market.
While the market throughout Europe was severely restricted for the first part of the year, since May it has gradually re-opened in many countries.
Occupancy rates were around 54% in the United Kingdom, 40% in France and 30% in Germany, with regions generally performing better than capitals.
The volume of investments in hotel property amounted to €4.7 billion in the first half, down 18% year-on-year (the first quarter of 2020 had not yet been impacted by the health crisis) but up by 35% compared to the second half of 2020.
“Covivio’s hotel portfolio is well positioned to benefit from the recovery to come: variable revenues, concentrated in France and Germany, as well as revenues from the UK portfolio, are generated mainly by domestic or regional customers, who travel individually for leisure,” Covivio said in its half-year results report.
In the first half of 2021, revenue from Covivio’s European hotel portfolio fell 20.2% on a like-for-like basis.