The City of Bath has been listed among the Top Ten UK hotspots for hotel investment according to the inaugural UK Hotel Market Index from Colliers International.
Hotels Director Simon Wells said: “Bath boasts an enviable concentration of fine hotels which make an ideal base for tourists keen to explore the Georgian city.
“Over the last couple of seasons occupancy levels have been rising, reaching 81 per cent in 2015.”
Bath makes the Top Ten together with major cities including Manchester, Liverpool and Edinburgh.
The Colliers International UK Hotel 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.
Bath also came fourth in terms of occupancy in 2015, and third in terms of Average Daily Rate at £119.
Simon Wells said: “This report underlines the fact that development has returned to the regions with the usual march of the budget brands, particularly Premier Inn and Travelodge, but also upscale hotels such as The Gainsborough in Bath.”
He added that recent hotel activity in Bath included the owners of the Abbey Hotel purchasing the Carfax on Great Pulteney Street with the intention of refurbishing the 39 letting bedrooms and creating a cocktail bar for a “bit more than a Bed and Breakfast” experience.
“Colliers valued their two existing hotels and the Carfax for Barclays Bank to facilitate the deal.”
The Colliers International report 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.”