Asia's hotel investment transactions up 218% in 2013
Asia's hotel investment transactions soared 218 percent year-on-year to US$7.5 billion (S$9.5 billion) in 2013, surpassing industry expectations, according to the latest figures from JLL's Hotels & Hospitality Group.
This makes 2013 the strongest year after the global financial crisis in 2007.
The region's growth was led by Singapore, Japan and mainland China, with Japan topping overall investment volumes at US$2.7 billion (S$3.4 billion). Singapore saw transaction volumes grow by more than ten times to US$2.0 billion (S$2.5 billion), while China accounted for 13 percent of total investment activity at US$1.1 billion (S$1.4 billion).
Other markets that witnessed robust growth due to the improved connectivity and burgeoning outbound travel from mainland China, include Hong Kong, Thailand and the Maldives, with transaction volumes at US$486.7 million (S$617.1 million), US$337.0 million (S$427.3 million) and US$267.6 million (S$339.3 million), respectively.
Mike Batchelor, Managing Director Investment Sales, Hotels & Hospitality at JLL said: "Strong investor sentiment and, importantly, the availability of quality hotel assets were key reasons behind Asia's impressive sales volume in 2013 which was hindered only by the availability of additional stock as many owners increasingly hold off selling assets in anticipation of further market growth."
"Mature hotel markets such as Singapore continue to be governed by well capitalised, inter-generational investors and as stock becomes increasingly limited, investors are now starting to look further afield once again at new and emerging markets in the region in the search for greater yield and capital growth opportunities," he added.
Moving forward, JLL also expects 2014 to be a stand-out year, although transaction volumes are expected to fall on the back of limited supply, despite strong demand.
Majority of the transaction volumes in 2014 will likely be accounted for by Japan, Indochina and the Indian Ocean, said Frank Sorgiovanni, Vice President, Research & Strategic Advisory, Hotels & Hospitality, JLL.
Nikki De Guzman, Junior Journalist at PropertyGuru, wrote this story. To contact her about this and other stories, email nikki@propertyguru.com.sg.
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