European Hotels Maintain Their Value with Slow Development
Bloomberg reports: European hotels have managed to hold their value reasonably well during the downturn, catching the eyes of investors, according to a Bloomberg report.
In 2009, hotel values fell further in the US than in Europe as new buildings added to the number of properties on the market (and in distress), according to Real Capital Analytics, publishers of Global Capital Trends. At the same time, occupancy and room rates in Europe increased at a faster pace than in the US, fueled by hotels in France and Germany.
Prices per room dropped by 24% in Europe last year to $223,475, while the US saw a larger decline of 35% to $105,151, Real Capital Analytics said. In 2008, European values increased 29%, compared with only 20% in the U.S.
Many US hotels acquired during the peak years of 2006 and 2007 were financed with a high percentage of debt, putting additional pressure on values. Over the first half of 2010, US hotel assets falling into distress totaled $8.0 billion, including $1.9 billion taken back as REO.
View the full article on Bloomberg: European Hotels Maintain Their Value with Slow Development
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Posted by: Matthew Stone