Private overseas investors and a weak sterling against the dollar has helped keep the luxury hotel market in the UK buoyant over the past 12 months, according to new research.
Private wealth law firm Boodle Hatfield said that 50 new luxury and premium hotels opened in 2018/19, a 1.5% rise over 2017/18, up to 3,380 hotels across the UK. Meanwhile the number of three-star and lower hotels dropped by just under 1% to 4,120 during the same period.
A strong market in London has helped drive the luxury market with new openings this year, including the Biltmore Mayfair (pictured), the first hotel from Hilton’s new luxury brand LXR Hotels & Resorts, and the Standard at King’s Cross.
Private investors from the Middle East and Asia have helped drive the growth of London’s luxury hotel sector. Recent acquisitions include the 603-bedroom Kensington Hilton - sold to Kurdish investor Bakir Cola for £260m, while Queensgate Investments bought a portfolio of four London properties from Grange Hotels for £1 billion.
The sector has also been boosted by a fall in the value of sterling against the dollar, which has helped drive international tourists to the UK, with VisitBritain forecasting a record spend of £24.5b from overseas visitors during 2019, up from £22.9b last year.
Adam Chamberlain, partner in the real estate team at Boodle Hatfield, said: “The luxury hotel market outside of London has showed some signs of cooling off, but the opportunity to invest in a landmark London hotel is still one that attracts wealthy individuals and families the world over.”
“Ultra-high net-worth individuals from the Gulf and Asia have long found luxury London hotels to be attractive assets, both as major trophy properties and income investments. That shows no signs of changing.”
Research by Boodle Hatfield revealed that 210 new hotels are currently under development in London.