Hotel investments in Asia are at their highest level since the global financial crisis in 2008, a new report from Jones Lang LaSalle (JLL) has revealed.
The company’s hospitality division revealed that hotel transaction volumes in Asia reached US$1.3 billion in the first half of 2013, marking an impressive 85% jump compared the same period in 2012, and the strongest first half of a year since H1 2008.
JLL said that strong investment into the established tourism markets of Singapore, Hong Kong and Tokyo, coupled with “opportunistic deals in emerging markets such as Thailand and the Maldives” were the main factors behind the rise. And according to Mike Batchelor, JLL’s managing director of investment sales for hotels & hospitality, this level of investment is set to rise even higher.
“Throughout Asia, we are also aware of circa US$400 million in hotel transaction volumes to be confirmed soon and a further US$1bn in due diligence,” said Batchelor.
Japan’s saw the highest level of investment in the first half of the year, accounting for 37% of total regional investment, closely followed by Singapore (34%) which was boosted by the sale of Park Hotel Clarke Quay for US$238m.
Thailand also saw strong movement, despite what JLL called a “somewhat unpredictable investment environment”, driven by the sale of the Laguna Beach Resort in Phuket.
“During the first half of 2013, we have seen a growing number of transactions, including those at the portfolio level, and improved investor sentiment translate to increased sales. The divergence between vendor and purchaser expectations that served to restrict investment activity in 2012, has improved this year leading to a number of landmark transactions in the first half,” Batchelor added.
Moving forward, JLL said Asian hotel investments would the driven by the “availability of investment grade assets in key cities and the growing insistence of sellers to close deals through transparent processes”
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