international investing in mediterranean resort and hotel ... repor… · 4 international investing...

www.tranio.com + www.mrandh.com

2018

International investing in Mediterranean resort and hotel real estate A joint survey by Tranio and The Mediterranean Resort & Hotel Real Estate Forum (MR&H)

3A joint survey by Tranio and MR&H

International investing in Mediterranean resort and hotel real estate is on the rise. This is evidenced by the results of an online survey conducted jointly by Tranio and MR&H in 2018. The majority of respondents (86%) note that the activity of international investors is increasing.

International investing in Mediterranean resort and hotel real estate

It is at the same level

It is decreasing

It is increasing

Figure 1. How would you rate the pace of international investing in Mediterranean resort and hotel real estate?Respondents, %

12%

86%

2%

4 International investing in Mediterranean resort and hotel real estate

More than half of the respondents surveyed by MR&H (57%) believe that resort and hotel real estate is the most popular, or one of the most popular, categories of investment properties in the Mediterranean region. At the same time, only 34% of Tranio’s respondents share this opinion, and about half of the respondents indicate that interest in resort and hotel real estate is at an average level versus other types of income property. In both cases, only a small proportion of those surveyed consider this category unpopular.

52%

34%

14%

39%

57%

4%

MR&H respondentsTranio respondents

Figure 2. How popular is resort and hotel real estate in the Mediterranean for international investors versus other types of income property?Respondents, %

At an average level

Less popular

Very popular


36%

59%

23%

50%

85%

20%


Figure 3. Which countries in the Mediterranean are most attractive to international investors in resort and hotel real estate?Respondents, %

Italy

Greece

23% 10%France

10%

Spain

Spain

Portugal

Italy

Cyprus

Greece

�e survey result exceeds 100% because respondents could name more than one country.

Spain, Greece and Italy top the ranking as the most attractive countries for investors, although their positions are evaluated differently by respondents of Tranio and MR&H:


The factors which make a country popular among investors are a stable economy and low bank charges (Spain, Italy, France), the residence permit for investment programmes (Spain, Portugal, Cyprus), and a growing market with high yield prospects (Greece).

According to some respondents, investor interest in Spain temporarily stopped increasing after real estate prices hit rock bottom and bank charges began to rise.

And if we take Greece’s case, one of the respondents noted that “investors in Greece are buying up distressed assets for redevelopment or conversion, but shy away from any greenfields. The investment environment is complicated by protracted judicial procedures. Nevertheless, if the whole bureaucratic climate improves, so will investment.”

As to the locations popular among investors in Greece, 55% of the respondents named the Cyclades Islands, namely Tyrа (Santorini), Mykonos and Paros. Many also consider Athens (36%) and Crete (27%) promising, while some respondents mention Rhodes and Halkidiki.

In Spain, 39% of the respondents believe that the Costa del Sol and other locations on the Andalusian coastline (Malaga, Marbella, Benalmadena, Torremolinos, Fuengirola) are particularly attractive. Barcelona is preferred by 22% of those surveyed, and the Balearic Islands (primarily Ibiza) and Costa Brava are among the other locations mentioned.

Finally, Rome, Milan and Puglia were each named by 18% of the respondents as preferred destinations.


Answering the question of who are the top nationalities investing in Mediterranean resort and hotel real estate, respondents said that nationals from Russia, the United States, China and the Arab countries, and other countries of the former Soviet Union, top the list. However, both Tranio and MR&H respondents differ in their views as to the ranking of the investors regarding their nationality.

According to the respondents, in Greece, real estate funds from the United States, as well as British private equities, stand out among investors.

41%

65%

29%

35%

47%

29%


Figure 4. What are the top nationalities investing in Mediterranean resort and hotel real estate?Respondents, %

USA

China

29% 29%Arab countries

24%

24%

UK

Germany

18%Switzerland

18%UK

18%Turkey

29%

Russia

Israel

China

Arab countries

Russia

USA

�e survey result exceeds 100% because respondents could name more than one country.


The most popular types of resort and hotel real estate are 3/4star hotels and resorts. Hotels top the list of Tranio respondents (33% of the votes), while resorts lead the MR&H rating (38% of the respondents’ votes).

One of the respondents said that “the concept of vacations has completely changed over the last few years. Tourists are searching for new destinations in the Mediterranean peninsula, looking for a more authentic and "local" experience. So, traditional "big" hotels are facing a challenge whereas the new type of hotels like serviced apartments, which offer a more authentic experience most of the time, are gaining ground. It is worth mentioning that a number of traditional hotels have changed into serviced apartments.”

Resorts

Luxury hotels (5-star)

Mid-scale hotels (3/4-star)

Figure 5. Which type of resort and hotel real estate in the Mediterranean is most promising for international investments?Respondents, %

27%

29%

25%

Serviced apartments, Extended stay

Budget hotels

15%

4%


Almost half of the respondents (46%) believe that the main reason for buying resort and hotel real estate in the Mediterranean is a desire to have their own housing where they can take a vacation. However, almost the same number of the survey participants (41%) think that investors are buying such properties to diversify their portfolios.

Portfolio diversi�cation

EU residency

Holiday, second-homes

Figure 6. What is the main reason for international investors to buy Mediterranean resort and hotel real estate?Respondents, %

41%

46%

37%

High yields

Tax optimisation

35%

2%

�e survey result exceeds 100% because respondents could choose up to 2 answer options.


Poor location choice

Overhead operating costs

Ine�ective management

Figure 7. In cases when an investment made in Mediterranean resort and hotel real estate becomes unpro�table, what is the main cause?Respondents, %

39%

72%

28%

Political or economic instability

Terrorism threats

20%

9%

Low occupancy 4%

�e survey result exceeds 100% because respondents could choose up to 2 answer options.

Sometimes an investment can become unprofitable, and 72% of the respondents believe that the main reason behind the failure is the ineffective management of the investment asset. Other answers lag way behind.

©2018 Tranio LLC

Moscow

Ul. Timura Frunze, 20, str. 3Moscow, Russia, 119034+7 495 54547[email protected]

Barcelona

Carrer d’Aragó, 366,08009 Barcelona, Spain+34 932 202 [email protected]

Munich

CentaHerkerBogen 8280797 Munich, Germany+49 711 [email protected]

Berlin

Potsdamer Str. 9210785 Berlin, Germany +49 711 [email protected]

Torrevieja

Calle del Palangre, 1403183 Torrevieja,Alicante, Spain+34 932 202 [email protected]

Athens

Vissarionos 4106 72 AthensGreece+30 211 198 60 [email protected]

About TranioTranio.com is an international real estate platform with a network of 700 partners worldwide and a catalogue of more than 90,000 listings in 53 countries. The company publishes daily news, high quality analysis on foreign realty, expert advice, and notes on laws and procedures related to buying and leasing properties abroad so that readers can make their property decisions with confidence.

international investing in mediterranean resort and hotel ... repor… · 4 international investing...

Documents