Going For Gold: London Hotel Investment

London Property InvestmentWith the schedule of events announced for the 2012 Games, Olympic fever is hotting up in the host city of London. But it’s not only the competing athletes going for gold; the race is on to invest in London’s booming hotel market.

As TRI Hospitality Consulting reported, London’s hotel market is going from “strength to strength”, currently outperforming most other European cities including failed 2012 Olympic Games bid city Paris, Madrid, Rome, Berlin and Amsterdam.

In line with wider economic recovery, the UK is now entering a new hotel cycle with demand for upscale hotels increasing and room rates rising. According to the world class corporate travel services company, Hogg Robinson Group, London room rates increased by 3% in 2010 and Deloitte predicts a 2.2% increase in revPAR (revenue per available room) in 2011.

With over 500,000 visitors expected at the 2012 Games demand for hotel accommodation in the Capital will be massive. Current stocks are unable to meet this demand and therefore leading global hotel brands such as Intercontinental Hotels Group (IHG) which owns 5% of the world’s hotel rooms, are actively expanding their London portfolios.

Capitalising on the demand for luxury accommodation in London (PwC predicts a 27% increase in luxury hotel rooms between now and the Olympic Games), work has already commenced on IHG’s flagship Docklands hotel – the 4* Holiday Inn West India Dock Road.

As an official Olympic partner, Holiday Inn West India Dock Road will be a feeder hotel for the much anticipated games affording a prime strategic location adjacent to Westferry DLR station and only 15 minutes to the Olympic Park at Stratford.

Steven Worboys, MD of Experience International based in Central London who are marketing the hotel, comments,

“IHG, owners of the Holiday Inn brand, are confident of high occupancy levels at West India Dock Road forecasting 70% occupancy in year 1 rising to 80% from year 2 onwards which will in turn deliver double-digit yields of 10.7% in year 5 and thereafter. Construction has already commenced at the Docklands site with completion due Q1 2012, months before the start of the Games.”

Hotel rooms in phase 1 sold within weeks of launch to buyers from all over the world including the Far East, and now in response to demand a limited number of hotel suites have now been released including some on the sought-after upper floors.

The 4* luxury rooms will include high specification en-suite bathrooms, bespoke Holiday Inn bed and bed linen, built in MP3 docking point, LCD TV, WiFi and flexible zoned areas to work and relax in.

Fully managed and operated by Holiday Inn, executive rooms are available at 19% below official RICS valuation at £189,000 however with non-status finance available a deposit (secured by insurance bond) of just £65,000 is required.

For more information about investing in London’s booming hotel market or indeed the limited number of new luxury hotel suites at Holiday Inn West India Dock Road contact the experts at Experience International on +44 (0) 207 321 5858 or visit www.experience-international.com.

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