Publication

Spotlight: European Extended Stay Market

Prospects for stock expansion and investment in the sector have improved

Summary

■ Evolving consumer preferences, primarily amongst millennial business travellers, is set to be a key driver of demand for extended stay product.

■ The acceleration in the rollout of extended stay concepts by a number of global hotel operators reflects a growing awareness of the potential scale of extended stay demand in Europe.

■ Examination of underlying fundamentals related to supply and demand across 35 European cities identified a number of 'opportunity' markets for expansion. The top five cities included Amsterdam, Barcelona, Berlin, Dublin and Stockholm.

■ European transaction volumes were up 32.9% in 2015 on the previous year. With an annual volume of €416.5m, however, it remains a relatively 'niche' sector albeit this reflects lack of built institutional grade stock rather than lack of investor appetite.

■ Some operators are moving into PRS with a 'hybrid' model. This has the potential to drive additional investment into the sector in general and plus improve the yield profile over a traditional PRS operation.

Articles within this publication

1 article(s) in this publication