OVERSEAS buyers are investing heavily in Yorkshire hotels as the London market shows signs of overheating, according to a specialist firm of business agents.
David Lee, the northern regional director of Christie + Co, said the hotel market was buoyant in the North of England, and attracting interest from as far afield as Thailand and China
During a recent visit to Leeds, Jin Xu, a senior Chinese diplomat, said that the Chinese government was encouraging Chinese business people to “go global”, which suggests the hotel investments are part of a wider trend.
Mr Lee said: “During 2015 we have noticed a considerable upturn in demand for hotel stock from a variety of sources. A considerable amount of the demand is from investors and buyers from overseas, and also traditional hotel groups and buyers.”
In 2015, Christie + Co sold hotels in the North of England to investors from Thailand, India, China and Russia. Many of these overseas buyers already have hotel interests in their home country, and are looking to broaden their investment portfolio into the UK and Europe.
“These investors tend to look for generally commercial, profitable hotels which are good properties and offer a good return on initial investment,’’ said Mr Lee.
One of the attractions of investing into the UK is that it is seen as a relatively safe economy, according to Mr Lee.
He added: “Historically, overseas investors would look to focus on trophy assets in London, however that market is very popular and arguably overheated so the provinces of the UK including the North are becoming increasingly sought after. Hotels are perceived as a relatively safe investment because of the usually good-sized property element,’’ he said.
“The general UK economy is positive. Statistics show that tourist levels and hotel demand in the UK are improving.”
Hotel groups are also expanding quickly in the North of England because bank funding is more readily available, according to Christie & Co.
The locations of hotels which have been sold to buyers from overseas or to hotel groups or multiple hotel operators include: Chester, Blackpool, York, Darlington, Sedgefield, Wakefield, Grimsby, Grasmere, Halifax, Southport, Wrexham and Liverpool.
Mr Lee added: “Demand continues to increase and there are hotels which are currently under offer from overseas buyers or hotel groups in Middlesbrough, Cumbria, Liverpool, Greater Manchester, Wakefield and Darlington.
“We expect 2016 to actually be an even busier year for hotel transactions as demand continues to increase, and we expect to see a return of high net worth individuals looking to buy regional hotels again as the general economy continues to improve.”