The pace of hotel development is expected to pick up as the cost of buying existing hotels is likely to continue to pull ahead of new builds, according to property real estate company Colliers International in its trends forecasts for 2017.
Marc Finney, head of hotels and resorts consulting at Colliers International, said that the tipping point for hotel development had been well and truly breached.
"Until relatively recently it was cheaper to buy an existing hotel than to build a new one. This is now very much in the past and we would expect to see a pick up in the pace of new hotel development throughout the UK," he added.
Meanwhile, the performance of the UK hotel market is expected to be closely linked to the overall general economy next year.
Julian Troup, head of UK hotels agency at Colliers International, explained: "With a few new supply-driven exceptions, the UK regional market will be supported by low interest rates, solid UK trading, acquisitive domestic buyers and an increasing flow of international capital attracted, in part, by cheap sterling."
Overall, the team at Colliers predicts a somewhat uncertain 2017 for the UK property market, with European political instability and the fallout from the US presidential elections expected to have an impact. However, such uncertainty could bring opportunity.
Tony Horrell, chief executive UK & Ireland, Colliers International, added: "The UK remains one of the most transparent and active places to do business, and currency arbitrage by international investors is opening up opportunities for new and greater investment which will no doubt help to drive the UK real estate market in 2017."