Hospitality industry investment in Asia-Pacific bounces back to pre-Covid levels, according to JLL Hotels & Hospitality Group’s data and analysis. Investment volumes in the region in the first half of 2022 totaled USD6.8 billion, representing 33.0% growth year-on-year and an 11.9% increase when compared with 2019. “This demonstrates a return to pre-pandemic levels of capital deployment into the Asia Pacific hotels sector,” the report reads.
A total of 19,822 rooms were transacted in 1H2022, a 29.9% y-o-y increase from 1H2021and a 9.4% increase from 1H2019. The increase in deal activity was influenced by a spike in portfolio transactions as institutional investors sitting on dry powder seek to deploy their capital more efficiently. When it comes to investment volume, countries which received the most capital include Japan (USD1.8 billion), Korea (USD1.7 billion), and Greater China, including Hong Kong (USD1.6 billion). Singapore (USD899.7 million), Maldives (USD205.5 million), and Indonesia (USD159.6 million) continued to recover strongly.
“Many developers (opted) to divest their non-core hotel assets in an attempt to ease their financial distress, hence attracting a large number of high net-worth investors actively seeking opportunities in quality hotel assets at discounted pricing,” said Zhou Tao, Managing Director of Hotels & Hospitality Group, JLL Greater China.
Activity in Australia (USD145.5 million) and Thailand (USD37.7 million) was more subdued but JLL believes these countries will see a boost in H2 2022 as “numerous marque deals” close. “There are numerous private equity funds and family offices currently active in the Thailand hotel market and JLL is seeing an increase in foreign interest with the lifting of travel restrictions,” the report says. Despite the rise in deal activity, JLL expects ongoing momentum to see some challenges amid growing macroeconomic and geopolitical headwinds in the second half of 2022.
NYSE-listed JLL is a leading professional services firm specialising in real estate and investment management.