Luxury segment in key gateway cities attracts investment
Speakers on a panel at Deloitte’s recent European Hotel Investment Conference say that despite the fears of a second global recession money is still flowing into the luxury segment. “It has just become more discreet,” says Liam Lambert, COO of Corinthia Hotels & Resorts. The performance of luxury hotels in gateway cities such as New York, London, Paris, Hong Kong and Shanghai, where average rates have risen in recent years, has been especially encouraging. Money from China and Asia is being invested in Europe in this regard.
The reason for the growth? “There’s a very sophisticated consumer. People still desire that experience,” says Roy Paul, chief development officer at Orient-Express Hotels Limited.
However, new development activity in the luxury segment is limited. And there are certain cities for developers to avoid due to over-capacity in the segment, such as Prague, St Petersburg and Budapest.
[pictured: InterContinental Paris – Le Grand; courtesy IHG]