The biggest transactions regarded trophy assets, accounting for 74% of volume.
Over the past decade, performance by the hotel investment market in Italy has in part reflected that of the real estate market in general: the euphoria of the 2005-2007 period was followed by years of downturn due to the international recession.
After the threshold of one billion euros, exceeded by investments in 2007, subsequent years in fact showed a market characterised by cautious deals, most of them stipula- ted by real estate funds and private individuals in major cities and guaranteed by leasehold contracts with leading hotel operators.
However, 2012 showed the first signs of improvement with an overall volume of investments up by 190% on 2011, even if it must be remembered that the biggest transaction was represented by the sale of a trophy asset: the Costa Smeralda portfolio acquired by Qatar Holding for
almost 600 million euros. Concentration of attention from international investors in Italy, precisely on trophy assets is an issue that deserves reflection when discussing this sector’s prospective development.
The trend in 2013-2015
The years 2013-2015 also happily confirmed this upward trend, always however characterised by a lot of trophy asset deals.
Compared to the previous twelve months, 2013 showed a further 9% increase in several important sales, including the Hotel Eden in Rome, purchased by the Dorchester Collection Group, the San Clemente in Venice and the Four Seasons in Florence. 2014 confirmed the previous year’s volume, with the largest transaction being the acquisition of the real estate component of Forte Village by Esmeralda S.r.l., the group that already managed this tourist resort.
Meanwhile, 2015 saw inve-
stments worth 682 million euros, up by about 33% on the year before, confirming renewed interest by national and international investors. The main transactions included acquisitions of a portfolio of hotels ( Westin Venezia, Westin Milano and Sheraton Roma) by a pool of international investors, for a sum equal to about 150 million euros and the sales of several prestige assets including the Westin Excelsior in Rome, sold to the Katara Hospitality group for 222 million and Gritti Palace in Venice, bought for approximately 105 million by the Al Jaidah Group (Qatar). It must also be remembered that an operation started up by an Italian owner, albeit abroad, led to the Romeo Group acquiring, for an undisclosed amount, an important, historic property in the centre of London, at 7 Old Park Lane, between Mayfair and Belgravia.
While all this attention to trophy assets is cause for reflection, traditionally they have represented 74% of total hotel investments in Italy and, while the logics of these investments are often linked to achievement of specific financial performances, it must be recognised as a positive factor that Italy is once again a market of interest.
Furthermore, much is still expected from the refurbiShment of hotels in the quality segment and redevelopment of further assets.
It would therefore seem reasonable to expect a more dynamic market over the next few years, favoured by the end of the international recession, an increase in incoming tourists and the positive effects of depreciation of the euro against the American dollar.