Cardiff has been revealed as the number one hotspot in the inaugural UK Hotels Market Index from Colliers International.

Hotels Director Simon Wells said: “Cardiff has reached the top of the index table - mainly due to its low active pipeline, low build costs and strong hotel performance over the last three years.

“This performance can be attributed at least partly to the city’s hosting of the Rugby World Cup in 2015. Cardiff also saw the biggest Compounded Annual Growth Rate (GAGR) over the reviewed period (2012 to 2015) with good growth reported year on year.”

The UK Hotels Market Index offers a unique analysis of 36 locations across the UK, ranked to determine the ‘hot spots’ for hotel development and acquisition across the country.

The 36 locations analysed in the report offer a current supply of 286,966 hotel rooms. London accounts for the majority of these rooms taking a 47 per cent share.
Simon Wells said: “This report underlines the fact that development has returned to the regions with the usual march of the budget brands, particularly Premiere Inn and Travelodge, but also upscale hotels.”

The Colliers UK Hotel Market Index is a new and unique way of looking at the hotel market, and uses nine Key Performance Indicators (KPIs), including; land value, room occupancy rates and construction costs to give each of the 36 locations a score from one to five (one being the lowest and five being the highest). These scores are then consolidated into a single figure and ranked to show which markets are hot and which are not in terms of a desirable location for investors to acquire an existing hotel or develop a new one. 

Marc Finney, Head of Hotels & Resorts Consulting said: “High land prices in London are causing investors to look outside of the Capital for opportunities to spend their cash.

“As such, we are increasingly being asked by our hotel investor and operator clients which UK regional cities offer the best development opportunities. As regional experts who know the local UK markets exceptionally well, our Hotel Market Index gives us something more than anecdotal evidence through which to advise our clients.

“With the Index we are able to couple our on the ground expertise with a more scientific formula to demonstrate the key performance indicators which should be influencing an investor’s decision making process and rank the opportunities according to their own investment criteria.”
Top Ten UK Hot Spots for Hotel Investment:
Ranking City
1. Cardiff
2. Manchester
3. Leeds
4. Chester
5. Liverpool
6. York
7. London
8. Edinburgh
9. Brighton
10. Bath

View the UK Hotels Market Index here