Investors are interested in the Austrian hotel business
Austria is one of the market leaders in Europe in terms of hotel infrastructure. The country provides all the conditions for recreation and a great time at its many resorts. All this makes the local hotel business a profitable option for investment.
The first half of 2022 was highly successful for the commercial real estate market. During this period, deals worth 230 million euros were made in Austria. By the end of the year, this figure reached 400 million euros – a record for the sector over the past few years.
The hospitality sector has aroused the most significant interest among investors. Many large hotels have changed owners. Demand has also grown in the hospitality industry, which provides recreational services in addition to accommodation. For example, deals were made with the Das Sonnreich thermal spa complex and the Grand Prix hotel in Spielberg.
Two years of lull associated with the pandemic have changed the behavior and type of buyers. The number of prominent business people from Germany and Israel has increased. Institutional investors are interested in large hotel complexes for accommodation and leisure. Private buyers are willing to shell out significant sums for real estate in Austria.
As for the forecasts for 2023, there are a lot of questions about the specifics of financing from the banks. For several months the conditions have been changing regularly, which brings uncertainty to the further development of the hotel market. Despite this, large investors are willing to consider buying Austrian hotels, especially since the volume of foreign tourism in Austria has already recovered to the level of 2019.
When choosing objects for investment, pay attention to luxury properties with higher yields. The fact is that such hotels are more in demand even in the low season. While tourists with average income visit other countries an average of 3 times a year, wealthy travelers go on vacation at least five times. And the latter spend time in resorts regardless of the season, and their lifestyle is less affected by economic downturns. For example, in Austria, occupancy in luxury hotels is 1.5 times higher than in three-star hotels. In hostels and two-star complexes, this figure is even lower.
Hotels in areas remote from popular tourist centers are becoming increasingly popular among vacationers. The demand for luxury chalets in the mountains is growing.