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Taking Stock of Hotel Investment & Development in German-Speaking Markets segments. From January 2016 until June 2016, hotels in Germany gener- ated average room occupancy of 69 percent (+1.7 percent) and increased revenue per available room (RevPAR) by 5.2 percent to €63 compared to the same period in the previous year. The average net room rate (without VAT and breakfast) was €92 euros (+3.4 percent). For the eleven months until the end of November (figures for the whole year 2016 were not yet available), the Federal Statistical Office reported an increase of 3 percent concerning overnight stays of guests in Germany, with a total of 420.2 million overnight stays. For the entire year, however, the agency forecasts a new record of about 448 million overnight stays. RADIANT SUNSHINE OVER RESORT HOTELS It is not surprising that 2016 also became the “year of the resort hotels” for investments and finances. At Expo Real, in Munich, in October, statements showed that an increasing number of banks are willing to finance these projects. Otmar Michaeler is CEO of Vienna-based developer Falkensteiner Michaeler Tourism Group (FMTG), which has changed its entire strategy from business to resort hotels. “For a start, rates of return are decreasing in the other non-hotel asset classes. As a consequence, the demand for the hotel industry and the factors in A and even B locations increased to incredible heights in some places. Therefore, more and more investor types, amongst others, institutional investors, have now identified the resort hotel industry as an alterna- tive. Resort hotels are still 1-percent point above the yields of hotels in the German-speaking metropolitan areas,” Michaeler said. So far, mostly family offices had been active in this segment, which was also the case with the sale of the Falkensteiner hotel portfolio that the group sold to a high-net-worth individual as a sale and leaseback in 2016. “But these times are over, where the resort hotel industry only works as an owner-operator model or can be rejected as a hobby,” Michaeler said. Other signals for the boom in the German-speaking resort segment are new and pure resort brand concepts, such as Arborea, with a concept very close to nature, or the continuous expansion of Explorer Hotels, which only focuses on hotels in the Alps. In the world of giants, TUI Hotels Group kindled new interest: the group no longer wants market and manage hotels only; it wants to purchase premises and properties actively and operate them itself. OUTLOOK FOR GERMANY Alexander Trobitz, Head of Hotel Services at BNP Paribas Real Estate GmbH, regards 2017 with some reserve. “After the phenomenal end-of-year spurt and the record result, a forecast for the current year is increasingly difficult,” he said. “Basically, there is an exception- ally high demand among investors, both among specialized investors as well as for risk diversification, so that hotels have already advanced to the top three among the asset classes. However, the supply side is insufficient despite a high number of ongoing constructions. And the current annual result is also owed to many large sales in the individual segment and portfolio segment. But this accumulation can probably not be repeated every year. However, reach- ing €4 billion should be the goal for 2017 again; one year ago, only very few would have bet on surpassing the €4-billion threshold and never on exceeding €5 billion.” AUSTRIA AND SWITZERLAND: CORNERSTONES OF THE GERMAN-SPEAKING REGION Austria and Switzerland are, too, attracting hotel investment and development. “The German-speaking market remains exciting; the demand among financially powerful investors (also from abroad) remains high,” said Rezidor CEO Wolfgang M. Neumann, stressing the importance of the German-speaking region. Rezidor is establishing new brands in the region, including Radisson RED and prizeotel, the first of which has been signed in Switzerland and slated to open in Bern by the end of 2019 with 188 rooms. 9 2016 The “year of the resort hotels” HOSPITALITY INSIDE | IHIFPDF Image | Burgenstock Taking Stock of Hotel Investment
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