HVS index shows Paris and London have highest value rooms
Paris and London have the highest value hotel rooms in Europe, according to the latest edition of HVS London's annual Hotel Valuation Index (VI).
The index reports that Europe's hotel sector saw a year of recovery in 2010 with average hotel values per room increasing by 1.5% to £184,073, following two consecutive years of double-digit percentage falls.
While Paris and London have the highest value rooms at £486,500 and £450,100 respectively, the star performers in 2010 were Frankfurt and Munich which recorded increased values per room of 19% and 15%.
Athens recorded one of the highest drops in value per room of 29%, due to Greece's recent economic turmoil.
Besides London, three other UK cities are included in the list. The value per room in Edinburgh during 2010 was £183,100, Manchester (£121,500) and Birmingham (£100,500).
For the first time, HVS has included a five-year forecast of values for each city which shows that 15 of the 33 cities analysed are expected to increase hotel values by 2015 to above the previous peak of 2006/2007.
HVS London director Tim Smith said that the importance of understanding the local dynamics of each city is more pronounced than ever.
"In prior years, there was a clear divide between eastern and western European markets with cities in the west clearly out performing those in the east," he said. "In 2010, that clear distinction blurred with some cities, such as Warsaw, showing growth beyond those in the west.
"Given the improving conditions in the majority of the countries analysed, the big question is whether the bottom has been reached?"
European hotel values slump by 25% in past two years >>
Hotels, restaurants and pubs rose around one-third of their peak values >>
Hotel investment strengthened in 2010 >>
By Janet Harmer
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