IHIF delegates content with overall industry direction

For perspective on the direction of the global hospitality industry, Hotel Management went directly to delegates attending this year’s International Hotel Investment Forum in Berlin.

Hoteliers were asked how 2015 is expected to shape up in regard to hotel performance, transaction activity and development. One, Bettina Bülte, manager at PwC, is optimistic. “In terms of transaction activity, we would expect a good year as financing is readily available and investor appetite is still strong,” she said.

Bülte also expects the main hubs for development, namely London and Paris, to constitute a large portion of this activity, while Dubai is expected to lead growth in the Middle East through 2020. “Political instability in some middle Eastern countries will continuously disrupt the industry performance,” Bülte said.

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Karl Bieberach, VP of feasibility and investment analysis for Starwood Hotels & Resorts Worldwide, said hotel performance should improve in some areas while abate in others. He noted that performance is flat to declining in France, Germany, Belgium and Turkey, but he expects performance to be stable to improving in the UK, Spain, Netherlands and Austria, and peaking in Italy.

“Globally, transactions will be stable to increasing in 2015 but mostly due to tailwind from 2014,” Bieberach said. “Hotel development will be stable first part of the year, but declining in latter part of the year. The peak has passed.”


Ascan Kokai, director, fund management, hotels for Invesco Real Estate, was more optimistic about impending transaction volume and its sources. “In light of strong travel and tourism fundamentals, there will be some growth in performance [in 2015],” Kokai said. “Transaction activity, helped by low interest rates and limited returns in other asset classes, is likely to be strong again while development will stay moderate.”

Federico Ochoa, senior manager of business analysis at Marriott International, said he expects to see increased deal volume, especially in the U.S. Ochoa said that Europe will also see an increase in deal volume thanks to a boost from a weaker euro, while Chris Day, managing director at Christie + Co., said he expects continued revenue per available room growth throughout the UK during 2015. Day expects slow but positive recovery to continue throughout continental Western Europe, but said political conflicts have the potential to negatively affect recovery in Eastern Europe.

Tea Ros, managing director at Strategic Hotel Consulting, said, “Although hotel market statistics are indicating toward a positive year of growth, the underlying economic challenges could make it a bumpy ride for some.”

Nick Smart, VP of development in north and west Europe for Hilton Worldwide, said, “Interest in new-build projects is back as there are much fewer opportunities to acquire hotel assets at less than replacement cost.”


The devitalized euro continues to plague the European Union, and its influence on the hotel industry and tourism is palpable. Opinions on the subject are varied, and few in the survey could agree on whether or not the strength of the euro will make business easier or harder for hotels.

“As long as political stability in Europe is maintained, travel will grow and hospitality will reap the benefit,” said Lionel Benjamin, director of hotels for Topland.

James Devitt, MD with Herald Hotels, said he does not expect to see prolonged movements in euro or dollar exchange rates, and doesn’t perceive this as a key aspect of hotel trading performance throughout Europe. “Most hotels trade predominantly with euro-denominated customers and will not be seriously impacted by exchange rate movements except in key global cities, where hoteliers will have to be alive to the need to switch their source market focus with this trend in mind,” Devitt said.

Others disagree. “It will certainly impact the travel behavior of guests, with opportunities to travel across European countries,” said Gesa Rohwedder, head of hospitality for Drees & Sommer.

Alex Andjel, VP of development for Yotel, said the weak euro is bad for companies, but good for international travelers, especially in the U.S. market. “Expect this not to impact RevPAR negatively,” Andjel said.

Derek Cheung, CEO of New Century Asset Management, said a weaker euro will benefit the hotel industry by creating stronger demand from non-European business, though a weaker European economic performance will negatively affect the European hotel market. “Overall performance should remain stable,” Cheung said.


Respondents were also asked what they believed a show like IHIF brings to the global hotel community, as well as what they wanted to get out of the conference. Hugo McNestry, CFO of CL Serviced Apartments, was excited to forge relationships, describing the show as “a chance to educate people, particularly lenders/investors on new trends, products and brands.”

Joao Pinto Coelho, board member for Pestana Hotels & Resorts, said, “IHIF plays a major role gathering investors and worldwide hotel managers, being an excellent opportunity to catch up and to discuss deals.”

Emanuel Berger, president of the international advisory board for Ecole hôtelière de Lausanne, said IHIF is a chance to refresh existing contacts, meet new people and be the first to digest the latest information in the industry, worldwide. “There is no opportunity other than at IHIF and ITB to meet the entire world within three days,” he said.

Hotel Management and IHIF are both operated by Questex.


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