That was the message of yesterday's discussion panel 'Post-Brexit British market opportunities' at the International Hotel Investment Forum (IHIF) in Berlin.
"There are clouds over the UK in terms of its safe haven status for us as investors," said Martin Bruehl, chief investment officer at Union Investment Real Estate.
"We are continuing to invest in the UK but it's getting more challenging for us to underwrite," he said, adding that his company is being more cautious about UK investment.
Keith Evans, vice-president - hotel acquisitions at Starwood Capital Group, agreed, and said that a lot of domestic investors in the UK had either put their transactions on pause around Brexit or were looking at smaller transactions.
However, he also said that he felt there are still good growth opportunities in both London and the regions. "We are believers in the UK," he said, adding that although the uncertainty surrounding Brexit had made large investment decisions more complicated, Starwood is focusing on "driving its assets forward" in the UK.
British Hospitality Association chief executive Ufi Ibrahim addressed the uncertainties in terms of worker concerns - she quoted statistics that there are approximately 700,000 EU workers in hospitality in the UK, 97,000 of which would be unable to stay under proposed immigration restrictions. She said that the industry could be looking to replace 50-75,000 people every year "just to stand still", and described immigration policy as "the single biggest threat to our business in the UK" and reiterated the association's call for a cut on VAT.
Bruehl said that operators need to be active in demonstrating they are robust enough for investor interest, and quoted recent inbound tourism statistics that suggest a drop in business travellers, adding that the industry may need to adapt to more leisure travellers than business guests.
UKinbound chief executive Deirdre Wells emphasised that there is definitely still demand for investment and tourism in the UK, adding: "if we don't invest in our assets then we will be overtaken by other markets."
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