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Hotel investments in Asia Pacific declined by 18 percent from US$9.2 billion (S$12.78 billion) in 2013 to slightly above US$7.5 billion (S$10.42 billion) last year, translating to 34,000 rooms traded at an average price of US$221,000 (S$306,903), according to a JLL blog post.
“This decline in investment activity in Asia partly reflected a geographic shift of investment focus to recovering and emerging markets (such as the Americas and Western Europe) by Asian capital, rather than a diminishing interest in local hospitality assets,” wrote Frank Sorgiovanni, Research Head of JLL’s Hotels & Hospitality Group in Asia.
Specifically, investment activity in the region last year was led by Japan with US$2.3 billion (S$3.19 billion), followed by Australia at US$2.2 billion (S$3.06 billion) and Mainland China with US$1.4 billion (S$1.94 billion). Thailand and Malaysia clinched the fourth and fifth spots with US$338 million (S$469.38 million) and US$292 million (S$405.5 million) respectively.
“The most active market by number of properties sold was Japan with over 100 hotels trading, many as part of a portfolio deal,” he noted.
In comparison, hotel sales in Asia Pacific for 2H 2013 was dominated by Japan and Australia, each with US$1.5 billion (S$2.08 billion) worth of transactions, followed by Singapore at US$953 million (S$1.32 billion) and China with US$703 million (S$976.26 million). The first three countries mentioned also contributed the most large-scale asset sales in 2013.
Meanwhile, cross border investors purchased two-thirds of all hospitality properties above US$5 million (S$6.94 million). With 146 single-asset and portfolio deals across the globe last year – of which 94 took place in Asia – they also took the lion’s share of large transactions with a high average size of US$55 million (S$76.38 million).
Nikki De Guzman, Editor at CommercialGuru, edited this story. To contact her about this or other stories email nikki@propertyguru.com.sg.
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