At €57.5bn, the investable hotel market in Germany reached a new record level in 2018. According to the latest analysis carried out by Union Investment and bulwiengesa, the market increased in value by approximately 9.5% compared to 2017 (€52.6bn).
The continued strong growth (prior year: +5.1%) is due to the sustained high level of new-build activity in the hotel sector and increasing asset values, reflecting a further improvement in the economic situation of many hotels in 2018.
Dierk Freitag, departmental head and partner at bulwiengesa, said: “Market conditions for hotels in Germany remain good. Overnight stays experienced stronger growth in 2018 than at any time in the last ten years, rising by 4% compared to 2017, and for approximately 80% of top hotels, revenues increased compared to the previous year. In terms of value growth, our forecast from the previous year was exceeded by 4.5 percentage points.”
Gains were particularly notable in the upscale segment, which saw good performance in 2018 with RevPar (revenue per available room) at around €91. From the 396,400 rooms across Germany that are categorised as investable by Union Investment and bulwiengesa, nearly 44% can be attributed to the upscale hotel segment, the report added.