The effects of Covid-19 on the hotel industry and the hotel real estate sector cannot be denied. “Particularly in the first half of 2020, there was a deep uncertainty on the market and among investors,” says Simon Kronberger,
Director Austria & CEE at Christie & Co. Since April, only a few transactions have been recorded, and especially transactions in city locations have failed to be closed. On the other hand, smaller cities and holiday destinations, which are generally less affected by the crisis, have been able to score. “In addition, some confidence in the asset class returned in the second half of the year, which is why the final result of EUR 280 million is conciliatory and not the worst since the records of Christie & Co.”
It is worth having a look at the year in review, to understand where and which hotels traded. In the first quarter of 2020, there were two notable transactions of city hotels. In February, the 117-room Pentahotel Vienna was sold as part of a larger portfolio. The buyer was the Luxembourg-German company Aroundtown. Shortly afterwards, the H+ Hotel at Salzburg's main train station changed hands in March. The real estate developer Rhomberg Bau sold the hotel to the subsidiary of Deka, WestInvest. After the first brief shock in the second quarter, hotel transactions picked up again in summer. The first major “post-Covid” transaction to attract attention was the sale of the 5-star hotel “The Ring” to the Viennese real estate and garage dynasty Breiteneder in September. Towards the end of the year, a mixed-use property in Eisenstadt, which also houses the Hotel Burgenland, was sold by UNIQA insurance to a Viennese real estate company. Shortly before the new year started, Christie & Co was able to sell the renowned Hotel Schloss Pichlarn near Schladming to the Austrian hotelier Georg Imlauer.
clearly sees the opportunities of the coming year: “Of course, the industry has suffered a fundamental setback. However, tourism is one of the main economic drivers in Austria and the desire to travel will return as the pandemic curve flattens out. The market adjustment will create opportunities to serve new niches and make investments. On the one hand there will be opportunities for developers to convert, renovate or reposition hotels, on the other hand remaining hotels can plan for the future with a consolidated market position. In any case, there will be numerous transactions in the near future from which the overall market can benefit.”
Christie & Co currently markets around 20 hotels in Austria and more than 300 across Europe on behalf of the owners. For further information, please check the Christie & Co Austria website at: at.christie.com