AN anticipated shortage of quality pubs and hotels coming on to the market in 2018 will lead to positive price movements in the year ahead, property firm Christie & Co has said.
Presenting its Business Outlook 2018 report in Glasgow recently, Christie & Co’s George Ranachan said pubs and hotels have continued to show signs of positive, stable growth despite “headwinds” in the sectors.
An anticipated increase in demand from private equity and trade buyers is expected to have a positive effect on pub values, said Christie & Co, which reported that average pub prices across the UK rose 3.8% in 2017.
Furthermore, the property firm stated 85% of pubs sold via Christie & Co remained trading as pubs.
Innovation is currently high in the sector, said Christie & Co, which added that it has observed a rise in the number of smaller, independent multiple operators (those owning three or more venues) who are “delivering better management and improved customer experience”.
Average hotel prices in the UK are said to have increased 5.8% last year; and, having seen a 38% increase in offers on hotels in 2017, Christie & Co said it expects transactional levels “to grow steadily in 2018”, with international demand for UK hotel assets “[showing] no signs of abating”.
The property firm forecasts hotels throughout the UK will maintain Revenue Per Available Room (RevPAR) in 2018 due to exchange rate benefits and ‘staycations’.
Restaurants, however, are “currently a victim of their own success”, according to the property firm, with the average price of UK restaurant businesses down 3.4% last year, from 14.1% growth in 2016.
Ranachan said the firm anticipates ‘brand fatigue’ to cause consumers to move away from restaurant chains, which he said “will create some notable casualties in 2018”.
“The [restaurant] sector does have a bright future, but operators need to meet the demands of their customers,” said Ranachan.