The hotel sector is benefitting from activity fuelled, in part, by the availability of finance and a surge of investors, many from outside the UK, looking for good opportunities and strong returns. This comes from the Business Outlook 2018 report, from Christie & Co.

The continued uncertainty surrounding Brexit has made its impact across all sectors, but the UK has also welcomed a spike in tourism and a surge of foreign capital into the UK market. Asian investors particularly view the UK as an attractive investment opportunity thanks to the country’s stability and relatively low value of the Pound.

The report expects further consolidation as pressures on costs continue, but this will prompt a shift towards embracing change, as technology and innovation evolve alongside the UK’s strengthening economy.

Average prices remained economically positive throughout 2017 across almost every sector in which Christie & Co specialises, including Hotels, which saw a rise of 5.8%.

Barrie Williams, Managing Director – Hospitality at Christie & Co, commented, “The hotel market is one of the only sectors to fully benefit from Brexit, welcoming a 20% increase of tourists in 2017 from the previous year. Driven mainly by leisure travel, RevPAR growth is expected to increase 2.4% in London and 2.3% in the regions throughout the upcoming year. The weak pound and favourable exchange rates have boosted inbound tourism and staycations, but any further currency movement could impact the market.

“An increasing proportion of single-asset hotels have an overseas connection, typically with equity coming from the Far East and while investment in the UK hotel market remains strong, the hotel market will not be without its challenges in 2018. Due to rising operational costs combined with increased pressure to find talent, hotels can expect a shift towards technology, changing the way in which customers interact with hotels.”

Chris Day, Global Managing Director at Christie & Co, commented, “We are seeing the signs of increasing confidence and economic positivity in almost every sector in which we operate and pipelines continue to grow by double digits as we enter 2018.

“Whilst higher inflation and sluggish wage growth are squeezing consumer spending and acting as a drag on the speed of UK growth, and a lack of clarity around Brexit is hampering some investment, but there are positives. Unemployment is at its lowest rate since 1975, inflation remains low, interest rates are stable and manufacturing growth is strengthening. In short, the economy is recovering and there is still plenty of room for growth.

“Within Christie & Co, we are embracing change and bolstering our team at home and internationally to capitalise on our expertise to attract and support both new and well-established clients who need help navigating the market, and who want to ensure a high-performing business.”