New hotel development in the capital is drifting away from the centre and becoming concentrated in south and east London, according to estate agent Knight Frank.
A heat map produced by the firm shows the greatest concentration of future development taking place in Lambeth, particularly on the South Bank. The area around Shoreditch and Spitalfields has the next greatest concentration.
Knight Frank said that South Bank growth was driven by the price of land, which is less expensive than in central London but still provides strong expected cashflow. Cultural attractions including the Tate Modern, Globe Theatre and Southbank Centre provide strong tourist as well as corporate demand, while the South Bank's own business community is a short walk from the square mile.
One Blackfriars, which will house a 161-bedroom hotel, is currently under construction on the South Bank. The Vauxhall Cross development, which moots a 181-bedroom hotel, will also provide future supply, according to the firm. Meanwhile a 494-room Park Plaza is set to open this summer by Waterloo station.
The estate agent noted that the opening of the US Embassy at Nine Elms in 2017 would add to growth prospects for the hotel sector south of the river.
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