According to Wall Street's Gordon Gekko, 'money never sleeps'. But London’s wealthy visitors do, and they’re checking into the city’s luxury hotels in their thousands.
London has long been a destination for those seeking luxury and there is a plethora of stunning establishments to choose from, from the Grand Dames of Mayfair to the quirky boutiques of Soho and the soaring glass towers to the city's east. There are 17,793 five-star bedrooms in London according to AMPM Hotels, more than the rest of the UK and Ireland combined, and another 3,323 in the pipeline.
2017, and the year-to-date 2018, has seen strong growth in the average daily rate for London’s top class hotels, buoyed by currency fluctuations and constantly upgraded stock. Occupancy has been more muted, although still in line with long-term trends.
Owning a central London hotel is rarely about short-term investment returns. There is great pride in being the proprietor of such trophy assets and buyers tend to be long-term holders – for example, the Barclay Brothers at The Ritz London, ADIA at The Lanesborough London, the Brunei Investment Authority at The Dorchester and Kingdom Hotel Investments at The Savoy.
As such, there are rarely 'for sale' boards outside the capital’s top hotels. However, one recent sale which has sparked significant interest is that of The Beaumont Hotel in Mayfair. The 73-bedroom hotel, which is being offered on a 125-year lease, was originally brought to the market earlier this year for £80 million. However, recent reports show it may change hands for closer to £130 million, a whopping £1.8 million per bedroom.
Three miles to the east, in London’s ever-so-trendy Shoreditch, the Reuben Brothers have just snapped up The Curtain Hotel. Developed by NYC’s Gaansevoort Group and boasting a members’ club, Red Rooster Harlem restaurant and rooftop pool, the hotel is thought to have been sold for approaching £100 million.
The luxury developments keep on coming and the American invasion continues. The 266-bedroom Standard Hotel King’s Cross will open in early 2019 and NYC’s NoMad (Sydell Group) will launch its first London property by 2020 (following its successful opening of The Ned hotel in the City). They will be joining a market which will include Qatari Diar’s 137-suite Rosewood London (at the former US Embassy) and Prime Investors’ new Waldorf Astoria within Piccadilly Circus’s Admiralty Arch. All will ensure that London remains one of the best choices for luxury stays in the world.
And how do these hotels ensure success? A winning location, a classy fit out and dynamic marketing are of course key, but it is the high levels of service which are essential to set them apart from the crowd. With the UK’s departure from the EU looming, recruitment and retention of staff are challenges faced by operators across the hospitality industry and this issue will be at the top of operators’ priority lists going into 2019.
Further information
Search for a commercial property
.jpg)
.jpg)