Skift Travel News Blog

Overseas buyers have made up nearly half of the recent investment in Japanese hotels because of the yen’s relative weakness to other currencies, Japan’s lower interest rates compared to rates in many other major countries, and a rebound in international tourism.

Bloomberg News reported the following striking statement:

“Overseas buyers were responsible for 47% of the 494.3 billion yen ($3.7 billion) invested in hotel deals that closed in the past 12 months — the highest proportion since 2014, according to data at the end of March from research firm MSCI Real Assets.”

Savills recently issued a report predicting low upcoming hotel supply, which will help hotels sustain pricing power. On the demand side, the country is making a concerted effort to reach record levels of inbound tourism, perhaps with a 60 million a year target for 2025.

While 2022 was a post-pandemic boom year for hotel demand in much of the world, total global hotel investment volume decelerated slightly to $71.9 billion, a decline of 2 percent relative to 2021. The relative lack of outbound Chinese hotel investment, the Russian war in Ukraine, and recessionary pressures in several markets tamped down the pace of growth.

That’s according to a Global Hotel Investment Outlook report released on Monday by JLL Hotels & Hospitality — an investment advisory firm that helps manage more than $6.8 billion in hotel assets.

A few charts from JLL’s report stand out.

In 2022, global portfolio transactions dropped 27 percent year-over-year, but small trades spiked. The total number of trades reached an all-time high, meaning that the market had a lot of smaller players and a lot of smaller assets being traded, compared with years with large assets and large portfolios shifted hands. CLICK TO ENLARGE.

There’s been much less ross-border investment in hotels than one might expect for quite some time. The five years before the pandemic, 2015 to 2019), saw cross-border hotel investments account for an average of 17 percent of total global hotel investment volume. Yet in that period, the investment declined as a global total year after year. CLICK TO ENLARGE.

Two of the most eye-catching data points from the report are the growing demand for hotel investment from high-net-worth individuals and the growing presence of these individuals in Singapore.

In fact, 16 percent of the year’s global investment volume was generated by first-time hotel buyers, predominantly comprised of family offices and high net-worth individuals. In Singapore, there are now an estimated 700 family offices, more than double the amount pre-pandemic. Expect this trend to continue in 2023 and beyond as lodging demand accelerates.

—Global Hotel Investment Outlook report released on Monday by JLL Hotels & Hospitality 

UPDATE: JLL released the report on Tuesday in sync with the Americas Lodging Investment Summit (ALIS) in Los Angeles.

The Government of Singapore Investment Corporation has acquired a majority stake in Sani/Ikos Group, a luxury beach resort group in the Mediterranean, for an undisclosed amount.

The transaction that is expected to close in the fourth quarter of 2022, subject to regulatory approval, values the Mediterranean-based luxury resort operator at $2.27 billion.

U.S.-based Oaktree Capital Management, Goldman Sachs Asset Management and Moonstone Investments, French private equity fund Florac and UK-based Hermes Global Private Equity, will be selling their stakes to the Singapore sovereign wealth fund as part of this transaction.

Andreas Andreadis and Mathieu Guillemin will continue to manage the luxury beach resort group as CEOs and co-managing partners, while Stavros Andreadis, who was earlier the managing director of the hotel group, will become honorary chairman, according to a Sani/Ikos statement.

 The three came on board first when Greece-based Sani Resort and Ikos Resorts merged in January 2016.

Speaking about as the hotel group’s efforts to strengthen its brand and expand presence in Europe, Lee Kok Sun, chief investment officer of real estate of the soverign welath fund, said, “We believe this investment will generate resilient returns and is testament to our confidence in the Greek and wider European tourism sector over the long term.”

Sani/Ikos Group develops, owns and operates 10 resorts in Halkidiki, Corfu and Kos islands in Greece, and in Marbella and Estepona in the Iberian Peninsula.