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  • Writer's pictureChristiane Wolf

The gastro real estate market after Covid-19


Hotel real estate has become a trend asset class over the past few years. Before Corona, you were just as popular with investors as residential real estate. The demand for the latter was unbroken during the Corona period - and it is until now. But what about gastronomy real estate? Are their operators and owners just as battered by the shutdown as the retail trade?

Hotel Gastronomie Immobilie verkaufen
Recently another top asset class: hotel real estate

Gastronomy real estate and especially hotels have developed into a popular asset class and have established themselves as a permanent fixture in the portfolios of large investors. According to CBRE, hotels for less than a billion euros were still being traded in Germany in 2019. Nine years later, the volume was already around five billion euros. Can the corona crisis stop these rapid price developments? It is not possible to make reliable predictions for the future after such a short period of time. In the short term, however, the picture is clear.

Are the prices still rising?

Corona has hit restaurateurs and hoteliers just as hard as it does retailers. Due to the lack of income, catering property owners have to accept deferred rents and possibly further financial losses. The tenants or lessees of the restaurants, hotels, guest houses and cafes were or are simply not able to generate the required income.

Gastronomie Hotel Immobilie zu kaufen
The hotels remained empty during the shutdown. The costs continued.
10 billion sales losses

According to estimates by the German Hotel and Restaurant Association (Dehoga), the total of 223,000 businesses in Germany had to cope with a loss of around ten billion euros in sales by the end of April alone. Around 70,000 companies are now even threatened with bankruptcy.

The situation is therefore explosive for gastronomy real estate investors. The hotel industry was booming until recently. According to CBRE, the transaction volume from January to March rose by 31 percent to a whopping 925 million euros compared to the same quarter of the previous year. The exuberant market sentiment before the pandemic can be seen in the high transaction volume.

Bad mood

The outlook for hotel investors is now all the more bleak. Many financial experts and brokers for gastronomy real estate are reckoning with strong effects on the real estate market in the short and medium term. This is also indicated by some industry studies. For example, the property climate index bulwiengesa for the hotel sector fell by 57 percent in April (compared to the beginning of the year). The company Colliers International carried out an investor survey and received clear feedback: It is assumed that rents and purchase prices for hotels will fall. More than 90 percent of the investors surveyed said this.

The prospects on the real estate market are currently less global.

Prices for hotels

A survey by Intreal paints a similar picture: 35 fund managers were interviewed. The evaluations show that the fund industry generally assumes a temporary effect for real estate. However, the prognoses are very different within the types of use. While they factor in fewer negative effects, especially in the case of residential properties, more than 50 percent of managers assume that prices will drop the most in hotels. One can only hope that Covid-19 cannot overthrow the upscale hotel asset class.

The owners of catering properties are often institutional investors and funds. You now have to deal with rent deferrals, which hopefully can be paid back. The industry also fears rent losses that result from bankruptcies.

No value correction yet

It can be viewed positively that real estate experts have not yet made any declines in values. - Maybe because the long-term effects cannot yet be foreseen.

But the current situation also offers many opportunities. Many hospitality property owners are now choosing to sell their property now. Often these hotels, restaurants, guest houses and pubs do not even officially come onto the market, but are only offered for sale or purchase by real estate agents for catering properties. It is therefore worth consulting a well-networked catering real estate broker if you are interested in a high-quality catering property.


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