Hotels spurring healthy appetite for investment

Extract from Commercial Report, Jim Dow, The Scotsman, 28 January 2003

Hotels are driving a lively investor market, according to Christie in its latest business outlook and review. It states that the greatest amount of investor activity in the past year has once again been in the hotel sector........

Christie states that....... “As long as interest rates remain low - and there is little sign of them increasing substantially - and the housing market in general remains robust buyers will still be keen to acquire hotels in 2003.”

Alex McGrehan, director in Edinburgh of Robert Barry, says there are plenty of good buyers looking at opportunities and there have been a number of very good sales....

.... According to McGrehan there are many people getting their foot on the first rung of the ladder of the hotel business. And while there are indigenous buyers there are still many from down south looking for a change of lifestyle.

After what had been a reasonable season and with interest rates still low the market was strong.

Gordon Mair, director of the Edinburgh licensed trade agents Bruce & Co, says there is a "tremendous amount” of people buying at the moment, with many first-time buyers taking advantage of the high value of their houses. The gap between the price of a house and the price of a business has closed, he states.

Most sought after are the small village inns from as little as £120,000 freehold up to £350,000 - £400,000, and 10 -15 bedroom hotels are in demand.

Mair states: “Most of the first-time buyers realise that it means hard work. They are not coming in with rose-tinted glasses - many are husband-and-wife teams who both work and don’t see much of each other but they can now work together.”