The trend for UK ‘staycation’ breaks has resulted in a spike in trade in hotels located in popular tourist destinations, according to Colliers International.
The company spoke of “impressive trading figures and forecasts” as a result of the summer season.
Julian Troup, head of UK hotels agency at Colliers International, said: “A significant spike in trade in hotels located in areas popular for ‘staycations’ has been observed by our teams throughout the UK, in most popular tourist destinations throughout the UK.
“All the signs are that this trend is set to continue, and that hotels in locations which benefit from ‘staycation’ holidays will attract a healthy level of interest in the months to come.
“These hotels offer buyers a great place to live, work and make profit. They should attract more funding support and, based on the impressive trading figures and forecasts we have seen, in most cases will provide buyers with a solid return on investment.”
Troup said that while lockdown had inevitably impacted upon the market, Colliers International had recently seen an increase in general enquiries, with an over 200% uplift in formal viewings in July when compared with the previous month.
He added that three distinct types of would-be buyers had been getting in touch: investors, developers and lifestylers. While investors were being attracted by the strong fundamentals of the ‘staycation’ market; developers were interested in the opportunities offered by well-located hotels which could be changed to residential use, subject to planning permission. Meanwhile, lifestylers were seeking an escape route from the ‘rat race’.
Troup said: “An increasing flow of opportunistic investment buyers have been contacting us, presumably attracted by anticipated pricing adjustments taking place among hotels with a greater reliance upon corporate and events trade. There are still numerous well-heeled cash buyers out there, as well as plenty of overseas buyers and investors in waiting.
“We have also been receiving a noticeable increase in alternative use enquiries from developers and other types of operator. If planning rules are relaxed, we expect to see certain hotels also attracting interest for alternative use
“There has always been a steady stream of lifestyle purchasers. However, all the signs are that more people will decide they want to consider a complete lifestyle change, cannot face returning to work, and want to have an opportunity to control their own destinies.
“With many wishing to leave living and working in cities, buying a hospitality business in a location of their choice is a real alternative, particularly where the move is enforced in the event of redundancy or having to downsize. In the last recession we saw many examples of new to the industry buyers who took advantage of being able to invest redundancy monies as well as releasing equity from their house sale.”