From the desks of the Hotel News Now editorial staff:
- UK hotel investment in 2017 reached £5.4 billion
- US growth to be ‘far slower than … historical average’
- Euro Zone bullish, despite no government in Germany
- Slideshow goes inside renovations at four iconic hotels
- Possible post-Brexit VAT laws could add costs burden
U.K. hotel investment in 2017 reached £5.4 billion: In 2017 in the United Kingdom, £5.4 billion ($7.32 billion) was invested in the hotel sector, an increase of 32% from 2016, according to figures released by business advisory Savills. The 2017 number is 51% above the 10-year average of £3.6 billion ($4.88 billion).
Savills reports in a news release that overseas investors were the main instigators of the increase and that the “high level of individual transactions can be attributed to the break-up of larger portfolios that were bought in 2014 and 2015.” The advisory firm adds that 60% of the deals in 2017 concerned individual assets and the “average price per key has risen from £104,255 ($141,322.47) to £145,303 ($196,964.93) over the last 12 months as investment volumes have increased.”
U.S. growth to be ‘far slower than … historical average’: Economists gathered for the American Economic Association in Philadelphia over the weekend to discuss business investment and consumer spending in the U.S., and they will not be “budging much from their projections that output growth will remain far slower than its historical average in the years ahead,” reports The Wall Street Journal.
The economists’ projection is despite the U.S. economy growing at a 3.2% and 3.1% annual pace in the second and third quarters of 2017, “well above the post-recession pace of near 2%,” The Journal reports. They cite a downtrend in the labor force and productivity gains as two reasons for their bearish projections, although some added that recent tax code changes could help boost the economy.
Euro Zone bullish, despite no government in Germany: German economic research firm Sentix in its latest report states investors are feeling confident about performance in the Euro Zone, a feeling that also exists in its largest economy, Germany, which currently has no government.
Although Sentix warned about the region possibly being under threat from a “danger of overheating,” its confidence metric rose from 31.1% in December to 32.9% this month. The firm stated: “It is astonishing that both the situation and expectations improve slightly. Momentum remains positive. This also applies to Germany, where the situation values are again at an all-time high.”
Slideshow goes inside renovations at four iconic hotels: It could well be said that the hotel industry is in fine shape if its iconic hotels—iconic due to age, history, location, legend or all of the above—are continuing to be renovated and capture guest attention and bookings.
Hotel News Now’s Dana Miller has uncovered four such properties on three continents given supreme makeovers in the last couple of years—InterContinental Hong Kong; The Ritz Paris; The Watergate Hotel, in Washington, D.C., and The Alder Hotel in New Orleans—for a slideshow that showcases the architects, hoteliers and investors behind the new leases on life of these grand dames.
Possible post-Brexit VAT laws could add costs burden: There is fear in the U.K. that proposed post-Brexit rules regarding value-added/sales tax could increase pressure on companies, according to the BBC, which reports that legislation “could force tens of thousands of firms to pay VAT upfront in cash to (Her Majesty Revenue & Customs).”
Currently, no VAT is paid until products have been sold to the final customer and paid for, but the BBC reports that “unless the U.K. remains in the Customs Union, goods from the (European Union) will have to be treated like all other imports after Brexit and will attract VAT by the 15th day of the following month.” Chair of the U.K. government’s treasury committee, Nicky Morgan, has written to HMRC to clarify the current position and said she would contact Members of Parliament to further investigate the matter.
Compiled by Terence Baker.