Largely unscathed by the shock of the Brexit vote, the North West of England remains a buoyant regional marketplace for hotels. If anything, there have been positive repercussions for the area over the past few months.
As far as where buyers are looking to acquire, Manchester City Centre and Greater Manchester remain prime targets, along with honeypot locations such as Cheshire and the Lake District. Supply in these areas also remains consistent with the majority of sellers undeterred by the political and economic uncertainty rippling through the rest of the UK.
Buyers are likewise still active, with the most common parties looking to acquire ranging from experienced single-site hoteliers, multiple operators with portfolios consisting of three to 10 hotels and larger investors who look for assets where they can put management in place.
There is a wide range of businesses on the market to cater for purchasers’ needs. Smaller B&Bs outside of the main cities and other key locations are less in demand but we regularly hear from aspiring lifestyle business owners and first-time buyers who prefer these types of assets meaning there is always interest out there.
The decision to leave the EU has attracted foreign buyers into the region who are looking to capitalise on the better exchange rates as well as booming domestic and overseas tourism, making the hotel market particularly strong in the UK right now. Particular areas which are taking a keen interest in the UK – and the North West in particular – since the Brexit vote are India and the UAE; potential purchasers from these localities are generally looking for higher class assets of which the North West has plenty in both urban and rural locations.
AM:PM data for the North West this month shows that UK budget brands still dominate the market with Premier Inn taking the majority of the market share. This looks set to stay the same with a further 978 rooms in the pipeline for these brands, whereas midmarket brands such as Holiday Inn and Best Western have no planned developments. InterContinental Hotels accounts for the only pipeline project for the upmarket sector, looking set to bring in 210 rooms to the North West which shows there is demand for higher quality accommodation for visitors to the region.
This is great news for the market and the influx of foreign interest and capital will reap huge benefits for the North West in the medium to long term. Currently, the future looks bright for hotel owners’ bottom lines and higher demand will continue to drive prices up meaning it’s a good time to both buy and sell.