Hotel real estate in Eastern Europe in terms of investment
The European real estate market is one of the traditional options for investing money, which is guaranteed to provide high income. However, over the past few years in the EU countries, property values have been growing steadily and demand is often limited. Therefore, investors are looking for different ways to benefit, and are increasingly paying attention to the Eastern European countries. Hotel real estate in this region shows good results, relatively quickly pays off with a small investment, compared to the popular metropolitan areas.
According to the segment analysis, yields in Prague and in some areas of Warsaw have fallen to the popular German cities. Therefore, developers are increasingly interested in Romania, Serbia, Hungary, as well as large cities in Poland. Many businessmen are ready to invest in local hotel complexes, and their number is growing with enviable consistency.
According to the data of Cushman & Wakefield, in the period of 5 years at the market of Eastern Europe six major regions are distinguished, where in the segment of hotel real estate deals were made in the amount of 4.6 billion dollars, with 30% of this figure falls on last year.
There is an active construction of new hotel complexes in Bucharest and Budapest, as well as in various cities of Poland. The latter country has high potential for investment. Large deals have already been made here for the construction of hotels in Tricity. The region includes such cities as Gdansk, Sopot, Gdynia and is located on the Baltic Sea. According to the terms of the contract, 9 hotel complexes are to be built on this territory within 3 years, which in total are designed for 1900 rooms. It is expected that the new facilities will increase the local budget by 30%. Bialystok is also interesting in terms of investment. In Budapest in 2021 it is planned to put into operation a number of facilities, which will have 3 thousand rooms.
However, it is too early to discard Prague and Warsaw. They are still popular for investing money, as evidenced by the activities of various investors in the markets of megacities. The level of profitability in these countries wins over, especially if you compare them with Western Europe. In addition, Poland and the Czech Republic show excellent rates of economic growth and consumer spending. The opening of new projects in tourist regions remains relevant, one such large hotel complex will soon appear in Poland on the Baltic Sea coast. Experts predict high profitability for it. In Prague, they have invested in the construction of a multifunctional hotel on the territory of the former railway station.
According to analysts of the hotel real estate market, the most promising centers for investment are Poland and Romania. They show good results in terms of return on investment and profitability, and are pleased with the pricing policy.